Health care isn't really free anywhere. In Canada we pay for it through out taxes, mostly the more you make the more you pay into this. In America you get most of your health care paid for by your employer. This allows lower tax but since the cost of health care for each person doesn't care how much you make it's essentially the same cost no matter how much you make this means lower paid workers are costing their employer as much for health care as high paid workers. This effectively makes poor people pay a greater share of the health care cost. Good for France that they actually break this number out so people can see how much they are paying.
Canada is going to a $10/day subsidized system. Not everyone is buying into it and it does limit choice for parents but I know people that have spent more for daycare than I do for my mortgage. It starts to make sense for (mostly women) to put careers on hold because they can't make enough to pay for childcare. It does make sense to subsidize daycare for low income people. The other option when everyone stops having babies is to prop up population with immigration.
All pensions and investments are a ponzi scheme. As long as we have a growing population of people wealthy enough to buy in prices will go up but if population declines and or wealth of younger people declines then there will be no one to keep pushing prices up. Your 401K isn't safe from this. Canada's previous conservative government pushed our retirement age up to 67 from 65 and then when a liberal government replaced them they brought it back to 65. The liberals have played with it too, giving older retirees more money while excluding the younger ones from it, clearly stretching the budget to motivate voters. I don't see how American Social Security is free from political interference or needing future generations to pay into it. Let's see what happens with Trump and Musk deciding.
It's a bit hypocritical to complain about French off the books labour when America counts on so much undocumented immigrant labour to do the work no one else does. No place is perfect but Canada has been better shielded from undocumented immigration. Geographically we are harder to get to and it's cold but we also don't have a big culture of hiring people to work for cash. The odd business with do a small job for a friend in cash but it's rare that someone can make a living without having a work permit or citizenship.
The assumptions are (1) I thought healthcare was « free » anywhere (duh it’s not) (2) Not including American illegal immigration (there’s literally a word limit on most published commentary pieces) (3) I think American SS is free from govt interference
Thanks, you did have several point to discuss, maybe not? I'll just dig back into one. You were critical of "off books employment" without a comparison to what is happening in America does seem hypocritical. You were limited by word count so you left this out?
Hello? I most certainly do understand the law of supply and demand. How does that relate to anything I said? And how have I turned into some sort of reference for idiocy on your post? Ordinarily I’m not touchy but you’re pushing it.
I appreciate this post. I was just trying to understand the social charges on my tax bill from last year. Seems reasonable to me that I chip in for services benefiting all - especially the least fortunate - and I benefit from living in a country where all lives are still considered worth something & the race to earn more euros doesn’t crowd out the rest of life.
Thanks for this detail, very interesting. Can you estimate the overall tax rates in France including social charges if one earns the French equivalent of a low six figure income -- say between $120k and $200k?
As you probably know in the US for that salary range we pay roughly 35% in local, state, federal, ss and medicare taxes, health insurance equivalent of another ~10% of income and in NY or CA 8% sales tax. That's around 50% of income going to taxes and health insurance, we aren't covered if we lose our jobs, and we get no other benefits like child care.
1.) Begin with the fact that France’s salaries are about *half of America’s. *According to Forbes “ A quarter earn less than $1,832 (€1,670) and almost a quarter earn more than $3,291 (€3,000). The top 10% of high earners earn $4,575 (€4,170), and to be in the top 1% you need to be earning at least $11,000 (€10,000) per month after tax.”
2. Social charges are *on top* of taxes.
3. There are not the same tax deductions like mortgage interest rate.
4. Here is France’s tax brackets. This does not include investment taxes.
Thanks! So it looks like for the range I was asking about income tax is 41-45% plus the social charges and VAT @ varying rates from 5.5-20%. Altogether comes to somewhere roughly between 55-60% it seems. Higher but it must be nice to live without fear of losing insurance or going bankrupt if you get sick.
It amazes me that a bit over 100 years ago there was no income tax at all in the US and now half our income goes to the govt and crap obamacare "insurance".
Yeah I get that. And the tax rate would be lower too. Tradeoffs everywhere but I think it'd be nice to live without so much desperation and precarity. Not to mention inflation in almost everything.
The way I see it UK/France/Germany/Italy/Scandos had a pretty good thing going before they opened their borders to tens of millions of immigrants they cannot afford. Most people didn't get rich but they have better quality food, less fear of losing everything and better job security.
The way things are in the US we can't rely on a job being around from year to year. I'd trade a lot for some stability.
I only just discovered this article, so am about 1,5 years late reading it and I am not French, nor have I lived in France, but have traveled there regularly and have many French friends who often complain about the system and also recognise the benefits of it. As a European, I would argue there is a number of things that the social charges contribute to and that you don't have in the US- 5 weeks of paid leave (I think in a weird way, Saturday is considered 'un jour ouvrable', so 30 days leave gives you 5 weeks (5x6).) In addition, you have paid sick leave (not sure about the number of days, and I do think the salary on those days is not 100% but maybe 90% or 80% ).
Also, in France, if you have a CDI, it is extremely difficult to get fired. Now as you say, there is a lot of stuff that happens outside this system as you say, people have undeclared cleaning staff, nannies etc and private business do things off the record which means their staff is not protected by the law but may get more 'cash' so there is instant gratification but not necessarily long term benefits.
I would take European social security systems over the American ones any day. I have American friends who would love to quit their job and do sth else, but stay because of the high salary and whatever health plan their fancy job offers- they are worried about how they will pay for that if they quit- so they are slaves of their jobs.
Sorry, this is a messy comment, but my point is, I think there are more benefits to European ways than the American ones.
Liza, the "worker protections" are costs passed onto employees and consumers; it is basic economics.
The issue is a *trade-off.* Some people value low salaries, low GDP, and stagnation in favor of time off and security. Others value growth potential, flexibility, and upward, and lateral mobility in a less stable and secure environment.
The downside of the CDI is also that… it is expensive to hire someone so there are less employment offers for them, which means salaries stay low. One may also argue that because there are less jobs, if you do achieve a CDI contract even if you hate your job you would stay because of the stability it provides. Keep in mind getting a rent contract, mortgage, bank account etc is very hard without one. I know at least two instances of couples who had broken up but were still living together because since one lacked a CDI, getting another lease was very difficult. I think at least the strong worker protections means that it is better to work a lower income job in Europe, but middle class or white color work is way better in the US. So to each his own, of course. But it makes sense why Europe is stagnating in some ways..
Yes, it is expensive to hire, keep, and fire someone. I value worker protections and think the US could use some more, but it is not without tradeoffs.
And yes, I sometimes here "It is better to be poor in Europe, but better to be upper middle class or wealth in America." and I think that statement is true (and sad on man y levels.)
Here in Germany, we have a model which combines private options, government-subsidized health care and socialized elements. It has its upsides and downsides like all models. But in the end all of these European systems cost money, a fact that's easily forgotten in sound bites on American media about "socialized medicine".
Diana, please clarify the statement, "I've never read an accurate American description of the facts surrounding European models and how differ from one another." I am American and wrote this.
Did you intend to include my publication in that or was it a more broad statement? If so, that is an insult.
It is surprising to hear this, “But in the end all of these European systems cost money, a fact that's easily forgotten in sound bites on American media about "socialized medicine".
I can list off my head many publications who clearly understand the cost of taxpayer-funded, government-managed healthcare.
What are you reading that doesn’t clearly explain this?
I've never read an accurate American description of the facts surrounding European models and how differ from one another. I think there are many reasons why Americans envisioned "socialized medicine" as a behemoth that offers no choices of care and has endless wait lists. No one understands the finding because funding models differ from country to country in Europe. The truth of these health care systems is nuanced and doesn't fit well with CNN or Fox news sound bites.
While publications like the Economist or the Atlantic might provide somewhat more in depth glances of generalized notions of the European model(s) there is certainly not general knowledge in the under informed, less critically thinking American public at large.
I've had many discussions over my last 30 expat years about this with Americans across the socioeconomic spectrum. To my knowledge there's not an exceptional degree of awareness about the realities of how these systems function ( or don't function)
As the health system in America continues to deteriorate for the majority of people, I'm sure the think tanks associated with election outcomes will try to parlay together parts of what we have. Without participation mandates nothing can really work. We saw that when they were gutted out of Obamacare.
"I've never read an accurate American description of the facts surrounding European models and how differ from one another. " Given that I'm American and wrote this, and it was reviewed by domestic policy experts before submitting for publication, this comes across as an insult. Is that your intent? If not, please clarify, thank you.
ETA: Think tanks are C3s and are legally prohibited from campaigning.
I'd recommend checking these out- all publications most of my peers read.
Let me start again on a different note. The reason I came and commented was because I really enjoyed your article and I learned things about the French social care system that I did not know. And it hit a note with me because, like you said, it's trade offs. Always trade offs.
The German system tends to get good press and it's OK. Except when it's not. It's made up of a network of regional private non profit providers that are government regulated and subsidized. You've inspired me to think about putting it on my post planner.
I lived in Italy for 10 years and that was another, completely different thing altogether.
All that to say - you're doing a great service by providing this information. I hope many people read and digest it.
France is in a bit of a bind. There is no incentive for higher salaries when you get the same benefits as everyone else, even after paying more taxes; the poor can't give up the benefits, and the rich are in Switzerland.
I agree. Something I do like in France about the system is that everyone, the Carrefour worker to a Renault exec has healthcare. And, if G-d forbid, an emergency happens they will get care.
But, everything is a tradeoff. And, France’s social programs face an uncertain future.
I’ve never lived in France so I have to stipulate that you know much more about this whole topic than I do, but honestly $1500 a month in “social charges” doesn’t sound like all that much to me. Before I aged into Medicare, I was paying $1300 a month just for my own individual health insurance premium, which bought me a policy that required me to pay 30% of covered charges up to an annual out of pocket limit of about $8000.
You always pay, for whatever it is. You pay with money or time or freedom or options or some externality you don't see. Nothing is free.
Correct
"So, why don’t the French invest in private retirement accounts?"
France is actually one of the countries in Europe with the highest savings rates.
The point, which was crystal clear, is that they largely depend on pensions funded by taxes. Americans tend to invest in 401ks by necessity.
ETA: there was also an assumption I observed among aime Americans where they assumed French are too dumb to save. That’s not the case.
Be well and happy new year.
Health care isn't really free anywhere. In Canada we pay for it through out taxes, mostly the more you make the more you pay into this. In America you get most of your health care paid for by your employer. This allows lower tax but since the cost of health care for each person doesn't care how much you make it's essentially the same cost no matter how much you make this means lower paid workers are costing their employer as much for health care as high paid workers. This effectively makes poor people pay a greater share of the health care cost. Good for France that they actually break this number out so people can see how much they are paying.
Canada is going to a $10/day subsidized system. Not everyone is buying into it and it does limit choice for parents but I know people that have spent more for daycare than I do for my mortgage. It starts to make sense for (mostly women) to put careers on hold because they can't make enough to pay for childcare. It does make sense to subsidize daycare for low income people. The other option when everyone stops having babies is to prop up population with immigration.
All pensions and investments are a ponzi scheme. As long as we have a growing population of people wealthy enough to buy in prices will go up but if population declines and or wealth of younger people declines then there will be no one to keep pushing prices up. Your 401K isn't safe from this. Canada's previous conservative government pushed our retirement age up to 67 from 65 and then when a liberal government replaced them they brought it back to 65. The liberals have played with it too, giving older retirees more money while excluding the younger ones from it, clearly stretching the budget to motivate voters. I don't see how American Social Security is free from political interference or needing future generations to pay into it. Let's see what happens with Trump and Musk deciding.
It's a bit hypocritical to complain about French off the books labour when America counts on so much undocumented immigrant labour to do the work no one else does. No place is perfect but Canada has been better shielded from undocumented immigration. Geographically we are harder to get to and it's cold but we also don't have a big culture of hiring people to work for cash. The odd business with do a small job for a friend in cash but it's rare that someone can make a living without having a work permit or citizenship.
Chris, are you ok? This comment is really long and makes a lot of assumptions about my beliefs.
I'm great, just commenting on what you've written. Is there a specific assumption you are concerned about?
Well, it’s unusual to write such a long comment.
The assumptions are (1) I thought healthcare was « free » anywhere (duh it’s not) (2) Not including American illegal immigration (there’s literally a word limit on most published commentary pieces) (3) I think American SS is free from govt interference
Happy New Year, Chris. Thanks for stopping by.
Thanks, you did have several point to discuss, maybe not? I'll just dig back into one. You were critical of "off books employment" without a comparison to what is happening in America does seem hypocritical. You were limited by word count so you left this out?
Happy New Year to you as well.
As you can see, the article is about France. It is not a comparative piece.
Typically op-eds are 400-1,200 words (max) and have 3 supporting points. You probably know this.
This piece follows a standard op-ed structure and is not a comparison (that part is clear).
As for attempting start an immigration fight…. no thanks.
Anyway, have a good day.
What do you know? The French legislature cannot, any more than any other legislature can, repeal the law of supply and demand in whole or in part.
It’s unclear that Sara understood that.
Hello? I most certainly do understand the law of supply and demand. How does that relate to anything I said? And how have I turned into some sort of reference for idiocy on your post? Ordinarily I’m not touchy but you’re pushing it.
I appreciate this post. I was just trying to understand the social charges on my tax bill from last year. Seems reasonable to me that I chip in for services benefiting all - especially the least fortunate - and I benefit from living in a country where all lives are still considered worth something & the race to earn more euros doesn’t crowd out the rest of life.
Thanks for stopping by. For help understanding your tax bill (we got ours months ago) I recommend engaging an accountant.
And I agree, all lives matter.
Good day.
I have one, thanks.
Great; that is the right resource for understanding one’s tax bill. It is odd you found this helpful for understanding your taxes.
Have a great holiday season, Sara.
Actually I procrastinated & didn’t ask them until today & after sending them a mail, I read your post. 🤪
Thanks for this detail, very interesting. Can you estimate the overall tax rates in France including social charges if one earns the French equivalent of a low six figure income -- say between $120k and $200k?
As you probably know in the US for that salary range we pay roughly 35% in local, state, federal, ss and medicare taxes, health insurance equivalent of another ~10% of income and in NY or CA 8% sales tax. That's around 50% of income going to taxes and health insurance, we aren't covered if we lose our jobs, and we get no other benefits like child care.
1.) Begin with the fact that France’s salaries are about *half of America’s. *According to Forbes “ A quarter earn less than $1,832 (€1,670) and almost a quarter earn more than $3,291 (€3,000). The top 10% of high earners earn $4,575 (€4,170), and to be in the top 1% you need to be earning at least $11,000 (€10,000) per month after tax.”
2. Social charges are *on top* of taxes.
3. There are not the same tax deductions like mortgage interest rate.
4. Here is France’s tax brackets. This does not include investment taxes.
https://entreprendre.service-public.fr/actualites/A17116?lang=en
Thanks! So it looks like for the range I was asking about income tax is 41-45% plus the social charges and VAT @ varying rates from 5.5-20%. Altogether comes to somewhere roughly between 55-60% it seems. Higher but it must be nice to live without fear of losing insurance or going bankrupt if you get sick.
It amazes me that a bit over 100 years ago there was no income tax at all in the US and now half our income goes to the govt and crap obamacare "insurance".
Right but if you were a French person on a French salary your salary would most likely be far less than your salary now.
So it’s a big trade off.
You can experience something similar by voluntarily taking a lower paying job and going on Obamacare.
Yeah I get that. And the tax rate would be lower too. Tradeoffs everywhere but I think it'd be nice to live without so much desperation and precarity. Not to mention inflation in almost everything.
The way I see it UK/France/Germany/Italy/Scandos had a pretty good thing going before they opened their borders to tens of millions of immigrants they cannot afford. Most people didn't get rich but they have better quality food, less fear of losing everything and better job security.
The way things are in the US we can't rely on a job being around from year to year. I'd trade a lot for some stability.
I only just discovered this article, so am about 1,5 years late reading it and I am not French, nor have I lived in France, but have traveled there regularly and have many French friends who often complain about the system and also recognise the benefits of it. As a European, I would argue there is a number of things that the social charges contribute to and that you don't have in the US- 5 weeks of paid leave (I think in a weird way, Saturday is considered 'un jour ouvrable', so 30 days leave gives you 5 weeks (5x6).) In addition, you have paid sick leave (not sure about the number of days, and I do think the salary on those days is not 100% but maybe 90% or 80% ).
Also, in France, if you have a CDI, it is extremely difficult to get fired. Now as you say, there is a lot of stuff that happens outside this system as you say, people have undeclared cleaning staff, nannies etc and private business do things off the record which means their staff is not protected by the law but may get more 'cash' so there is instant gratification but not necessarily long term benefits.
I would take European social security systems over the American ones any day. I have American friends who would love to quit their job and do sth else, but stay because of the high salary and whatever health plan their fancy job offers- they are worried about how they will pay for that if they quit- so they are slaves of their jobs.
Sorry, this is a messy comment, but my point is, I think there are more benefits to European ways than the American ones.
Liza, the "worker protections" are costs passed onto employees and consumers; it is basic economics.
The issue is a *trade-off.* Some people value low salaries, low GDP, and stagnation in favor of time off and security. Others value growth potential, flexibility, and upward, and lateral mobility in a less stable and secure environment.
The downside of the CDI is also that… it is expensive to hire someone so there are less employment offers for them, which means salaries stay low. One may also argue that because there are less jobs, if you do achieve a CDI contract even if you hate your job you would stay because of the stability it provides. Keep in mind getting a rent contract, mortgage, bank account etc is very hard without one. I know at least two instances of couples who had broken up but were still living together because since one lacked a CDI, getting another lease was very difficult. I think at least the strong worker protections means that it is better to work a lower income job in Europe, but middle class or white color work is way better in the US. So to each his own, of course. But it makes sense why Europe is stagnating in some ways..
Yes, it is expensive to hire, keep, and fire someone. I value worker protections and think the US could use some more, but it is not without tradeoffs.
And yes, I sometimes here "It is better to be poor in Europe, but better to be upper middle class or wealth in America." and I think that statement is true (and sad on man y levels.)
Here in Germany, we have a model which combines private options, government-subsidized health care and socialized elements. It has its upsides and downsides like all models. But in the end all of these European systems cost money, a fact that's easily forgotten in sound bites on American media about "socialized medicine".
I found your article very informative. I was not referring to it in any way.
Understood. Thank you for clarifying that part.
I do agree that in general, people are misinformed about other countries and their tradeoffs.
There is never a solution, only a tradeoff.
Thank you for the article links. I will read them.
I stand by my statement that I believe Americans to be vastly under informed on this topic.
I can't see how one can be insulted by an open, honest and friendly discussion.
I wish you all the best.
Diana, please clarify the statement, "I've never read an accurate American description of the facts surrounding European models and how differ from one another." I am American and wrote this.
Did you intend to include my publication in that or was it a more broad statement? If so, that is an insult.
It is surprising to hear this, “But in the end all of these European systems cost money, a fact that's easily forgotten in sound bites on American media about "socialized medicine".
I can list off my head many publications who clearly understand the cost of taxpayer-funded, government-managed healthcare.
What are you reading that doesn’t clearly explain this?
I've never read an accurate American description of the facts surrounding European models and how differ from one another. I think there are many reasons why Americans envisioned "socialized medicine" as a behemoth that offers no choices of care and has endless wait lists. No one understands the finding because funding models differ from country to country in Europe. The truth of these health care systems is nuanced and doesn't fit well with CNN or Fox news sound bites.
While publications like the Economist or the Atlantic might provide somewhat more in depth glances of generalized notions of the European model(s) there is certainly not general knowledge in the under informed, less critically thinking American public at large.
I've had many discussions over my last 30 expat years about this with Americans across the socioeconomic spectrum. To my knowledge there's not an exceptional degree of awareness about the realities of how these systems function ( or don't function)
As the health system in America continues to deteriorate for the majority of people, I'm sure the think tanks associated with election outcomes will try to parlay together parts of what we have. Without participation mandates nothing can really work. We saw that when they were gutted out of Obamacare.
A big subject! 🙂
"I've never read an accurate American description of the facts surrounding European models and how differ from one another. " Given that I'm American and wrote this, and it was reviewed by domestic policy experts before submitting for publication, this comes across as an insult. Is that your intent? If not, please clarify, thank you.
ETA: Think tanks are C3s and are legally prohibited from campaigning.
I'd recommend checking these out- all publications most of my peers read.
https://reason.com/tag/single-payer/
https://www.nationalaffairs.com/publications/detail/medicares-single-payer-experience
https://fee.org/articles/how-we-know-single-payer-wont-lower-health-care-costs/
Let me start again on a different note. The reason I came and commented was because I really enjoyed your article and I learned things about the French social care system that I did not know. And it hit a note with me because, like you said, it's trade offs. Always trade offs.
The German system tends to get good press and it's OK. Except when it's not. It's made up of a network of regional private non profit providers that are government regulated and subsidized. You've inspired me to think about putting it on my post planner.
I lived in Italy for 10 years and that was another, completely different thing altogether.
All that to say - you're doing a great service by providing this information. I hope many people read and digest it.
Happy holidays from the Black Forest.
France is in a bit of a bind. There is no incentive for higher salaries when you get the same benefits as everyone else, even after paying more taxes; the poor can't give up the benefits, and the rich are in Switzerland.
It will be interesting to see how things play out.
I agree. Something I do like in France about the system is that everyone, the Carrefour worker to a Renault exec has healthcare. And, if G-d forbid, an emergency happens they will get care.
But, everything is a tradeoff. And, France’s social programs face an uncertain future.
I’ve never lived in France so I have to stipulate that you know much more about this whole topic than I do, but honestly $1500 a month in “social charges” doesn’t sound like all that much to me. Before I aged into Medicare, I was paying $1300 a month just for my own individual health insurance premium, which bought me a policy that required me to pay 30% of covered charges up to an annual out of pocket limit of about $8000.
Hi Aunt Linda.
👋🏼👋🏼👋🏼👋🏼