The taxman cometh, or What do you mean I'm supposed to live my principles?

We received our final Swiss tax bill for fiscal year 2004 the other day, and I’m just now getting over the shock of it. (Do I even go into an aside here about why it has taken until July of 2006 to get a final tax bill for fiscal 2004? No, it’s long and boring and utterly beside the point. But here’s an interesting little tidbit about Swiss taxes. There is no income tax withholding. No withholding at all. Nope. You get a big huge bill for all your taxes and you are supposed to be able to pay the damn thing all at once, because, you know, you set aside money to pay your taxes. Between this and the countless referendums* and initiatives on which the Swiss are expected to vote, I find that the government trusts the people to be rational entirely too much in this country.)

So. Swiss tax bill. Yes. Let’s just say Ouch. In keeping with Switzerland’s extreme federal system, we’re paying the overwhelming majority of our taxes to the Kanton (state) and the Gemeinde (locality) – and Small Village, where we lived until mid-2005, had a shockingly high tax rate – because the Kanton and the Gemeinde provide and pay for the vast majority of services: education, social welfare, refugee and asylum assistance are all provided at the state and local level. Looking at the raw numbers of what we paid, and what services we actually consumed, I’ve got to say: from a straight book-keeping what’s-in-it-for-me sense, we are not getting our money’s worth.

No, no we are not. Sure I walk safe and clean streets (but we do pay an additional garbage tax, plus the garbage stickers on every bag, plus I have to carry my recyling to the depot myself) and we use the Autobahn system (but of course we pay an additional 40 Francs a year for our Swiss Autobahn Vignette, which is required in order to drive legally on the Autobahn), and I ride safe, clean and reliable public transportation almost daily (but I paid for my annual pass, you know), but other than that…No, not really getting our money’s worth. The postal system is remarkably efficient, but fairly expensive. Switzerland does not have national health care. They do not have universal pre-school beginning at age three, as in France. Mandated maternity leave was only just approved in October 2004 (by a vote of the people), and compared to our Austrian neighbors, for example, it’s a cheap sort of leave. All in all, I’d have to say that Switzerland is an island of conservative capitalism in the European sea of social welfare and we are not. getting. our. money’s worth.

Except. Except that I’ve spent a life-time spouting off about social justice, and life in Switzerland more closely approximates justice than life in the US. Although Switzerland does not have national health care in the Scandinavian sense, nobody goes uninsured. Health insurance is required by law, and if you can’t afford to pay premiums, the government insures you (if you can afford them, you'll be paying some of the highest premiums in the world - and health insurance is almost never an employee benefit). R and I and our enormous tax bill, we help pay for those who can't afford insurance. And there is the Mütterberaterin. We pay for that, too (and use it, I must add). Although there is poverty in Switzerland – up to 284,000 working poor in a country of 7 million (link auf deutsch) – there is not the desperate grinding poverty of American inner-cities, the poverty that so shocks Europeans. The social safety net is hung at a much higher level than in the US, and R and I, we help pay for that too. The 2004 poverty line in Switzerland was defined at 4,603 Francs a month for a family of four, or 55,236 Francs a year, which translates to US$45,127 – more than twice the 2004 US equivalent of $19,157 for a family of four. $19,157 for a family of four. Think about that for a minute. Switzerland’s higher poverty line can in part be accounted for by a higher cost of living here, but it’s not twice as high; the rest of the difference is accounted for by the fact that the floor is higher here. Society is willing to pay to ensure that the floor is higher here, and it shows. In 2005, UNICEF reported that 6.8% of Swiss children lived in poverty (defined as less than half of the median country income) compared to 21.9% of US children. R and I pay for that difference, too. To be honest, I think not all of this is driven by pure social idealism, though the presence of a genuine Social Democratic party in Parliament certainly doesn’t hurt. I think that among other things, the Swiss crave stability and are perceptive enough to realize that a more just society will be more stable. Some of the social goodness of Swiss life is, I suspect, a by-product of good old Swiss pragmatism.

As a US-American who’s proud of who I am and where I come from, who thinks that these are the most important, perhaps the only truly important, words in the English language, it pains me to say that although life may be more free in an absolute sense in the US, life is demonstrably more just in Switzerland. R and I pay for more than we receive because we have more than we need and because the calculus of social justice requires that of us, and because the calculus of social justice is actually applied here. Society here is far from perfect, but it is more perfect than the one I left behind. It wounds me to say that, and it makes me feel disloyal, but it’s the truth. Social life here is more just, and the life of the poor is more dignified, and those sorts of things don’t happen by accident, and they don’t happen by spending a life-time spouting off about social justice. They happen by spending money.

Living here has forced me to put my money quite literally where my mouth is. I’ve always talked a good game about social justice; here I have no choice but to live up to it. And I know it's sort of a cheap way of living up to it, letting my tax bill do the talking rather than more proactive charitable giving (though we do that, too) or, more importantly, giving of my time, but it is living up to it. And really, government simply has to be a large part of the equation in promoting social justice - the collective action problem of individuals doing everything is simply too great. Private charitable giving, Warren Buffett notwithstanding, is never going to be sufficient unto the day; and as for volunteering, well, plenty of us are already burning the candle at both ends. Beyond the practicalities of the matter, there is a moral and philisophical question at stake: by what sort of social contract do we wish to be bound? What's the whole point of government anyway, if not to ensure some basic decency? I like that the Swiss system enforces a social contract that people might wish they would live up to themselves but, for the varied and complicated reasons of real life, don't. If the price of a more just and decent society is a little bit of money and a little bit of freedom, it's a price I'm glad to pay.

In the US we are fond of saying "freedom is never free." But you know, neither is justice.

The taxman cometh. Bring on the taxman.

* Yes, I know, the proper plural of referendum is referenda, but in political science, among people who study the referendum and the initiative, it is accepted usage to speak of referendums. Problem? Take it up with William Safire.