President Biden's first term in office

[PointOfViewGun]

Do colleges raise prices because of federal aids or do they increase prices because federal aid expands reach for prospective students to colleges thus increasing demand?

[Lord Thesaurian]

If it were simply a matter of demand, we should expect to see costs at public and private colleges increase at the same rate. The far higher costs and levels of aid at private colleges are consistent with the above citation showing institutions that are most exposed to federal program maximums ahead of policy expansion experience disproportionate tuition increases. Even if it were the case that demand for private education is far higher than public, that’s all the more reason why the federal government should not be in the business of subsidizing and incentivizing elitism.

[PointOfViewGun]

The problem pretty much starts with considering going to a college as elitism... If more federal aid is directed at private colleges due to higher costs it also explains higher demand to them. Is the federal aid the cause or the attempted remedy?

[Lord Thesaurian]

Is the federal aid the cause or the attempted remedy.

Both, as per post 2172.

[sumskilz]

The entire EU has free universities.

No, they don't. You just pay for them through obscenely high tax rates, including on people so poor that they would have a zero or negative tax rate in the US.

Four year tuition and fees less the average aid package at US public colleges is about 300 dollars a year. Even as a conservative estimate, that’s on the lower end of what university costs in Europe. Students at private colleges receive far more federal aid and federal loans on average than public students, and costs at private colleges are 5 times higher, also increasing at a faster rate. This is because the federal government inflates the cost of college by expanding credit and aid access, which it justifies by the increased costs. This is the cycle that made college unaffordable in the US.

In parallel, the bureaucracy is expanding to meet the needs of the ever expanding bureaucracy:

The number of non-academic administrative and professional employees at U.S. colleges and universities has more than doubled in the last 25 years, vastly outpacing the growth in the number of students or faculty, according to an analysis of federal figures...

Universities have added these administrators and professional employees even as they’ve substantially shifted classroom teaching duties from full-time faculty to less-expensive part-time adjunct faculty and teaching assistants, the figures show...

Universities and university associations blame the increased hiring on such things as government regulations and demands from students and their families—including students who arrive unprepared for college-level work—for such services as remedial education, advising, and mental-health counseling.

“All of those things pile up, and contribute to this increase,” said Dan King, president of the American Association of University Administrators.

“I think there’s legitimate criticism” of the growth in hiring of administrators and other nonacademic employees, said King. “At the same time, you can’t lay all of the responsibility for that on the universities.”

There are “thousands” of regulations governing the distribution of financial aid alone, he said. “And probably every college or university that’s accredited, they’ve got at least one person with a major portion of their time dedicated to that, and in some cases whole office staffs. These aren’t bad things to do, but somebody’s got to do them.”

Since 1987, universities have also started or expanded departments devoted to marketing, diversity, disability, sustainability, security, environmental health, recruiting, technology, and fundraising, and added new majors and graduate and athletics programs, satellite campuses, and conference centers.

That's from the Huffington Post, so it's a rather charitable take. I suspect most Americans wouldn't be happy about subsidizing a lot of what is included within that last paragraph, if they knew the details.

[PointOfViewGun]

No, they don't. You just pay for them through obscenely high tax rates, including on people so poor that they would have a zero or negative tax rate in the US.

It's rather the opposite. The 10% income tax bracket in USA is actually 0% in Germany, for example. The difference starts appearing in favor of USA after that first bracket.

[sumskilz]

It's rather the opposite. The 10% income tax bracket in USA is actually 0% in Germany, for example. The difference starts appearing in favor of USA after that first bracket.

That's not really the case, because in the US you only pay on your adjusted gross income, which is your income after deductions. The standard deduction is $12,550 for a single person, $18,800 for a head of household, and $25,100 for married filing jointly, plus at least $3,000 for every child. Then there are tax credits that almost everyone low income qualifies for, which is money that the government gives you to pay your taxes, after which you can keep whatever is left over. Having a single child gets you up to $3,733. Having three children gets you up to $6,935.

[PointOfViewGun]

That's not really the case, because in the US you only pay on your adjusted gross income, which is your income after deductions. The standard deduction is $12,550 for a single person, $18,800 for a head of household, and $25,100 for married filing jointly, plus at least $3,000 for every child. Then there are tax credits that almost everyone low income qualifies for, which is money that the government gives you to pay your taxes, after which you can keep whatever is left over. Having a single child gets you up to $3,733. Having three children gets you up to $6,935.

You can deduct your expenses in Germany too. With no proof the number you can deduct is 1000 Euros but with proof you can deduct quite a lot. So that 0% taxation for the first bracket can extend into the second bracket as well.

[Cyclops]

Happy to pay obscenely high taxes because its my kink. I live in a country the size of the continental USA with a population smaller than Texas, leaving stuff like having enough people with a tertiary education or healthcover to "the market" , as well as it works in the US, doesnt fly here.

Like the US we have a Byzantine tax code that serves mostly to exempt the in crowd from oayjbg their share.

The immensely robust US system doesnt have to justify itself to me, nor to it.

[sumskilz]

You can deduct your expenses in Germany too. With no proof the number you can deduct is 1000 Euros but with proof you can deduct quite a lot. So that 0% taxation for the first bracket can extend into the second bracket as well.

Okay, but it’s not even close. Germany has 0% taxation below 9984 euros. Assuming you’re correct about being able to deduct 1000 without proof, that’s zero taxation below 10984. After that, it’s 14%. Currently a euro and a US dollar have the same value, but almost everything costs more in Germany, again this is partially due to heavy taxation. That means that in Germany, the purchasing power of a euro is only 0.74 dollars. So worse case scenario, meaning nothing special to deduct, a German pays 0% below $8128 PPP (10984 x 0.74) and starts paying 14% above that. Worse case scenario for an American, being single, having no dependents and no special deductions, is to pay 0% below $12950, and start paying 10% above that. However, that worse case scenario almost never happens, because if that single person worked to earn their money, they would receive an earned income credit of $560, meaning they would pay no taxes on the first $5600 above $12950.

In summary, worse case scenario for a working single person with no special deduction is as follows:

0% tax up to $18555 in the US, 10% on income starting above that.

0% tax up to $8128 in Germany, 14% on income starting above that.

In 2021, the average American single worker had a net tax rate of 22.6%

In 2021, the average German single worker had a net tax rate of 37.7%

Consider that in light of the fact that the median income in Germany is $16845 PPP compared to $19306 in the US, and Germany is one of the wealthiest European countries. There are others that are much worse in terms of both low incomes and high taxes.

Tying it back to the main point relevant to the thread, I'm an American and my university education was "free", meaning it was paid for by US federal Pell grants and scholarships, so I won't be benefitting from Biden's "relief". When people in the US borrow money to pay for their education, they do so either because they're under age 24 and their parents make too much money to qualify for assistance or because they don't want to work at all.

When Europeans say their university is "free", does that mean their governments are giving them $8000 to $23000 per year for living expenses above and beyond their direct university expenses? I ask, because that's most of what student loans are actually being used to pay for. At the university I went to, student loans cover $17664 a year above and beyond education expenses for a single student without dependents not living with their parents (more if they have dependents). That's well above the median income PPP in most European countries, so I doubt it.

If you like paying high taxes in your country in exchange for "free" higher education, that isn't really any more free than it is in the US, I don't care either way, but there are a lot of common misunderstandings about how things really work in the US compared to other countries. We don't need Biden's student loan debt forgiveness to achieve a typical EU standard of living, considering the median income PPP in like half (maybe most) of Europe is near or below what we consider poverty level in the US.

[PointOfViewGun]

Okay, but it’s not even close. Germany has 0% taxation below 9984 euros. Assuming you’re correct about being able to deduct 1000 without proof, that’s zero taxation below 10984. After that, it’s 14%. Currently a euro and a US dollar have the same value, but almost everything costs more in Germany, again this is partially due to heavy taxation. That means that in Germany, the purchasing power of a euro is only 0.74 dollars. So worse case scenario, meaning nothing special to deduct, a German pays 0% below $8128 PPP (10984 x 0.74) and starts paying 14% above that. Worse case scenario for an American, being single, having no dependents and no special deductions, is to pay 0% below $12950, and start paying 10% above that. However, that worse case scenario almost never happens, because if that single person worked to earn their money, they would receive an earned income credit of $560, meaning they would pay no taxes on the first $5600 above $12950.
In summary, worse case scenario for a working single person with no special deduction is as follows:
0% tax up to $18555 in the US, 10% on income starting above that.
0% tax up to $8128 in Germany, 14% on income starting above that.
In 2021, the average American single worker had a net tax rate of 22.6%
In 2021, the average German single worker had a net tax rate of 37.7%
Consider that in light of the fact that the median income in Germany is $16845 PPP compared to $19306 in the US, and Germany is one of the wealthiest European countries. There are others that are much worse in terms of both low incomes and high taxes.
Tying it back to the main point relevant to the thread, I'm an American and my university education was "free", meaning it was paid for by US federal Pell grants and scholarships, so I won't be benefitting from Biden's "relief". When people in the US borrow money to pay for their education, they do so either because they're under age 24 and their parents make too much money to qualify for assistance or because they don't want to work at all.
When Europeans say their university is "free", does that mean their governments are giving them $8000 to $23000 per year for living expenses above and beyond their direct university expenses? I ask, because that's most of what student loans are actually being used to pay for. At the university I went to, student loans cover $17664 a year above and beyond education expenses for a single student without dependents not living with their parents (more if they have dependents). That's well above the median income PPP in most European countries, so I doubt it.
If you like paying high taxes in your country in exchange for "free" higher education, that isn't really any more free than it is in the US, I don't care either way, but there are a lot of common misunderstandings about how things really work in the US compared to other countries. We don't need Biden's student loan debt forgiveness to achieve a typical EU standard of living, considering the median income PPP in like half (maybe most) of Europe is near or below what we consider poverty level in the US.

Things you can deduct from your income in Germany:

• costs of travelling to and from work
• business literature
• professional dues, and
• work equipment.

• Individual taxpayers may take deductions up to EUR 13,805 for the alimony paid to a divorced partner.
• Fulfilling certain requirements, a portion of the actual expenses for childcare can be deducted up to a maximum of EUR 4,000 per year/child for children younger than 14 years or for handicapped children.
• 30% of tuition fees (except for housing, care, and food) for qualifying dependent children is deductible if a recognised private school located in the EU/EEA countries or a German school is attended and if graduation is approved by the government. The special expenses that can be claimed are limited to EUR 5,000 per annum per child.
• Contributions to health insurance are completely tax deductible as far as these contributions are paid for primary basic healthcare. Contributions to long-term care insurance are also tax deductible under these circumstances.
• Contributions to old-age pension schemes are, in general, tax deductible up to an overall limit of EUR 25,639 (EUR 51,278 for married taxpayers filing jointly). However, for a transitional period (2005 to 2025) only a reduced amount can be deducted. In 2022, the tax deduction amounts to 94% of the actual contributions, at a maximum of 94% of EUR 25,639 (EUR 51,278), and increases by 2% in each of the subsequent years up to the year 2025. For employees contributing to the state pension scheme, the deductible amount will be reduced by contributions paid by the employer to the state pension scheme, as those contributions are already tax exempt under the income tax act.
• Mortgage interest is only deductible against income from the property (i.e. not deductible for privately used property).

That's quite a lot more than 1000 Euros for the average person and they're not really special deductions. When Europeans say their education free it means they're free from deciding whether they can afford their desired college or not. It makes the process merit based as well. Sure, they may pay more taxes buts your initial comparison that you asserted earlier is not valid.

[Lord Thesaurian]

The US has similar deductions to those you listed, so not sure what your point is, much less how it refutes the fact Germans face a higher tax burden on average than Americans.

[PointOfViewGun]

The US has similar deductions to those you listed, so not sure what your point is, much less how it refutes the fact Germans face a higher tax burden on average than Americans.

I take it you didn't pay attention to what sumskilz initially claimed. His claim was that people in EU countries with income so low that would generate zero or negative taxes in USA are paying high taxes in their own countries. That was just false.

[Heathen Hammer]

Student debt loan forgiveness should be done at the expense of educational institutions with artificially inflated tuition costs, since they are the root of the problem.

[Lord Thesaurian]

I take it you didn't pay attention to what sumskilz initially claimed. His claim was that people in EU countries with income so low that would generate zero or negative taxes in USA are paying high taxes in their own countries. That was just false.

The list of deductions you provided is irrelevant, both because it doesn’t refute what you say it does and because most or all of those are also deductible on top of the already much higher standard deduction in the US. As was explained, the net average tax rate, meaning taxes after deductions, credits etc, is far higher in Germany. The net average tax rate of the bottom 50% of incomes in the US is less than 5%, and for 98% of people earning 30,000 or less, it’s 0%. The same is true for 67% of people making 40-50,000, which is the average income in Germany. Are you seriously trying to argue that close to 70% of Germans earning the average income effectively pay no income tax? To be clear, 37.7% is higher than 0%. It’s the opposite of false.

https://www.statista.com/statistics/...-income-level/

[PointOfViewGun]

The list of deductions you provided is irrelevant, both because it doesn’t refute what you say it does and because most or all of those are also deductible on top of the already much higher standard deduction in the US. As was explained, the net average tax rate, meaning taxes after deductions, credits etc, is far higher in Germany. The net average tax rate of the bottom 50% of incomes in the US is less than 5%, and for 98% of people earning 30,000 or less, it’s 0%. The same is true for 67% of people making 40-50,000, which is the average income in Germany. Are you seriously trying to argue that close to 70% of Germans earning the average income effectively pay no income tax? To be clear, 37.7% is higher than 0%. It’s the opposite of false.

https://www.statista.com/statistics/...-income-level/

It is relevant to what I was responding to. It helps to pay attention to what people actually argue about. As you don't do that nothing you said there actually addresses what I pointed out.

[Lord Thesaurian]

Gainsaying isn’t an argument. German income so low that would generate zero or negative taxes for most American income at the same level is taxed at a far higher net average rate in Germany.

[PointOfViewGun]

Gainsaying isn’t an argument. German income so low that would generate zero or negative taxes for most American income at the same level is taxed at a far higher net average rate in Germany.

Let me know when you can counter the issue without changing it.

[alhoon]

OK, I will ask:

Can PoVG and Sumkiz give a short synopsis of the long and complex discussion about Germany and USA taxes? As in, in a TL;DR version?

[PointOfViewGun]

OK, I will ask:

Can PoVG and Sumkiz give a short synopsis of the long and complex discussion about Germany and USA taxes? As in, in a TL;DR version?

sumskilz claimed that really poor people in Germany are paying really high taxes where in USA they would have a zero or negative tax. I pointed out that the lowest income bracket in Germany does not pay taxes at all. Its rather simple but sumskilz tried to make it long and complex to make it a defensible position through dilution of the topic.