When making comparisons with Sweden or other countries the cost of healthcare, housing, food, and transportation should be taken into account. Healthcare and transportation costs are much higher in the U.S. I think too we also have a higher per capita income and I don't know how things balance out. One thing for sure though. I'd rather be poor in Sweden than in the U.S.
There is also the fact that many students who start a four year degree end up never graduating. At the college I teach at it is clear that we are marketing to students who should not be going to college and shouldn't realistically expect to get a degree. But we need the money due to lack of state support and as a result standards for passing have gone down. What we have now is a system that has the incentives in the wrong place and this will have bad societal consequences years from now.
Like almost everyone else who comments on this topic I have ideas on how to make things better and like almost everyone else those ideas are largely naive.
Why is the cost of living relevant when you’re talking about debt levels? The point is simply that our debt levels aren’t that unmanageable, and we could achieve something very close to the Swedish student loan system by simply automatically enrolling people in repayment plans we already have.
Moreover, American cost of living is the same in Sweden as in the US (the GDP per capita in nominal dollars is identical to the figure in purchasing-power-adjusted dollars). You may need a car, but housing is cheaper in most of the country.
As to healthcare, making comparisons is difficult. 2/3 of college graduates have employer subsidized healthcare. For those people, you need to look at the median employee premium portion, which is $2,200/year. (There are also out-of-pocket costs, mostly for drugs, but the US figure of about $1,000 is not much different than the Swedish figure of $800 on that front).
The employee premium paid by the typical college graduate is much less than the extra taxes that same person would pay in Sweden. The median college graduate earns $51,000 in the US to start. The median employee premium of $2,200 is 4.4% of that. The tax differential is almost certainly higher than that. (In Sweden, all of that is taxed at 30% county tax, no federal. In the US, the first $12,000 is tax free, and the rest is taxed at 10-12% federal, plus maybe 4-5% state and local, plus 7.65% FICA).
You wrote: The point is simply that our debt levels aren’t that unmanageable,...
The cost of living is important as this and income level determines the affordability of debt. Just comparing income level and debt level between the two countries is not a deep enough analysis in order to determine if your proposed fix would work.
You are also ignoring the fact that a large number of people who go to college never graduate. These people are completely absent from your analysis of the problem. You are focusing only on the set of college graduates of both countries. I suspect that the rate of college completion for those who enroll at least one semester is much higher in Sweden than in the U.S.
According to your post 1/3 of U.S. college graduates don't have employer subsidized healthcare. This is a huge percentage and you are ignoring them in your analysis of relative debt burden.
Taxes are higher as a percent in Sweden than in the U.S. but in the U.S. at a moment's notice you can get screwed financially really bad in ways that you can't in Sweden. An ambulance ride in the U.S. costs much more than in Sweden and yearly out of pocket expenses for healthcare is much higher. The necessity of a car causes most people in the U.S. to have auto loans and unplanned maintenance costs can send people over the financial precipice.
I suggest that merely looking at the numbers you have does not give a clear picture of the relative situation in both countries.
Why would transportation costs be higher in the US? Gasoline is two times cheaper in the US than in Sweden. Food is roughly the same price, depending of what you eat.
Public transportation is very bad in the U.S. Even in major cities. For the vast majority of people a car is a necessity in the U.S. Most Americans end up in debt to buy a car. Then there is insurance and the opportunity cost of the government having to spend a great deal of money on road maintenance that could otherwise be spent on things like education.
European cities have much higher population density, and the lower personal income (often via higher taxes and, ironically, worker protection laws) changes the tradeoff between driving and taking pub trans, so more people take the bus. The tradeoff is that a lot of people live in small boxes.
And european governments have plenty of bs job creation engines like roadwork, too.
Would be nice to have some data. One related observation, that seems less surprising the longer I live here, is that europe has no spacex, google, tesla, nasa, coherent mars rovers, the list goes on... if you give people stuff, they're mostly just afraid someone's going to take it away. But yeah, to echo someone else's comment, I'd rather be poor, or even average, in Europe. I guess being super wealthy here wouldn't be that bad either, since nobody's nipping at your heels.
> europe has no spacex, google, tesla, nasa, coherent mars rovers, the list goes on...
The European Space Agency, Airbus, a huge number of car manufacturer, ...
It's not surprising that the #1 economy in the world has more big company than the #3 one (when they decide to group). A lot can be said also about the American culture and politics when it comes to entrepreneurship. But presenting Europe like its devoid of any important industry is also outright false :) .
On that second point, a perspective note for non-US people who don't realize: Sweden has about the same geographic area as just California. Only covers about 5% of the whole contiguous US.
Transportation costs for most individuals are related to density at a city level, not a nation level, so I don’t see the relevance of comparing density of a nation.
>At the college I teach at it is clear that we are marketing to students who should not be going to college and shouldn't realistically expect to get a degree.
It seems like almost all 4yr colleges do this to some extent nowadays. Freshman lecture halls with 500+ students and one adjunct faculty ratio are a money maker. Capstone classes with 40 students and one tenured professor are a money loser. You'd have to hire really bad bean counters to miss the obvious way to exploit that situation for monetary gain.
That may be so, but doesn't necessarily imply that health care is more expensive in the US. It's possible that in the US they simply spend more money on useless things, or do more screenings with better technology, for example.
> It's possible that in the US they simply spend more money on useless things, or do more screenings with better technology
These are both components to saying that the health care system is more expensive in the US.
> a rich country could spend more money on health care and still have worse average health than poorer countries
Yes. I think that multiple people on this thread would argue that this is the case with the US.
> many health outcomes may also depend on wealth - for example over-consumption leading to obesity, which might affect health more than spending on health care can compensate.
This implies that differences in social services and urban design have an impact on healthcare spending. This is relevant to /u/sykick's statements "the cost of healthcare, housing, food, and transportation should be taken into account." and "I'd rather be poor in Sweden than in the U.S."
"> It's possible that in the US they simply spend more money on useless things, or do more screenings with better technology
These are both components to saying that the health care system is more expensive in the US."
Sorry, but that doesn't make sense. If the service is better, the higher price is justified. Presumably you can always choose to not use the better technology to save money.
"This implies that differences in social services and urban design have an impact on healthcare spending."
How does it imply that? More social services would stop people from overeating? Do you have a citation for that?
In Sweden, you pay taxes for healthcare and everyone receives healthcare.
In the USA, you pay taxes for healthcare, but only the old and the poor receive that tax funded healthcare. So the average taxpayer has to buy their own health insurance in addition.
The linked chart also shows a clear correlation with Purchasing Power Parity, which also should be accounted for.
Also government employees, and those under the care of the VA.
> Purchasing Power Parity, which also should be accounted for.
Yes, I agree.
To illustrate with a simplified example:
Imagine nation A has median wage of $20k and nation B has median wage of $40k. Also imagine that their income distribution is the same. Then, if healthcare costs in nation B are twice as high, healthcare is equally as affordable.
" So the average taxpayer has to buy their own health insurance in addition."
How the money is collected is pretty irrelevant (indirectly via taxes or directly by the insurance company or physician). What matters is the overall cost.
It is relevant due to the complexity and uncertainty imposed. When I lived in the US, I didn't have a way of learning how much an interaction with a medical system would cost me. Now that I live in the UK, I do.
It could be that richer countries simply have more money to spend on health care, so why wouldn't they spend it.
On the other hand many health outcomes may also depend on wealth - for example over-consumption leading to obesity, which might affect health more than spending on health care can compensate.
In that example, a rich country could spend more money on health care and still have worse average health than poorer countries.
Not saying that is exactly what is going on, just that it makes sense to be careful with judging.
Another question perhaps is who pays taxes - another source I found said 2/3rds of voters in Sweden get their money from the state, either because they are government employees or recipients of welfare.
So an average tax rate might also be misleading, if many don't pay taxes at all.
There is also the fact that many students who start a four year degree end up never graduating. At the college I teach at it is clear that we are marketing to students who should not be going to college and shouldn't realistically expect to get a degree. But we need the money due to lack of state support and as a result standards for passing have gone down. What we have now is a system that has the incentives in the wrong place and this will have bad societal consequences years from now.
Like almost everyone else who comments on this topic I have ideas on how to make things better and like almost everyone else those ideas are largely naive.