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Good government requires adequate tax revenues. The United States needs “good government” as well as “life, liberty and the pursuit of happiness.” Why state the obvious? Because many seem to deny this reality!

State Sen. Llew Jones (Missoulian, Sept. 23) argues that the threat of an increased state deficit must be met by reducing spending. No tax increase allowed. President Trump “trumpets” a “massive” tax cut. We don’t yet know how massive — or implications for spending and deficits. Yet we know: 1. health outcomes in the U.S. are inferior to those elsewhere, 2. our infrastructure is crumbling, 3. public education results lag those of our competitors, 4. incarceration rates are high, 5. federal deficits are large and 6. Montana is cutting public spending.

Yes, spending is too high in some areas. Per capita private spending on health care in the U.S. is seven times that in other developed countries. Even as others rely heavily on public health care, U.S. per capita public spending is higher than in all but two countries (the Netherlands and Switzerland). Total health care spending in the U.S. is 17 percent of GDP – 5 to 6 percentage points more than in any other country, and with poorer outcomes.

Our per capita military spending is twice that of our NATO allies. Total U.S military spending, at 4 percent of GDP, is three times that of China and nine times that of Russia. Yet, we hear little about cutting our military budget – indeed, just the opposite.

And there is the cost of incarceration. U.S. incarceration rates (at 700 per 100,000) are 5 to 10 times that of other developed countries. Direct prison costs are $80 billion-$100 billion. Total costs, including those to family and the community, are in excess of $1 trillion, or 5 to 6 percent of GDP.

How do government revenues stack up against those in other civil societies? Total government revenue in the U.S. is 33.4 percent of GDP. Japan (35.9 percent) and the U.K. (38.5 percent) are slightly higher. Government revenues in the Netherlands (42.8 percent), Germany (44.5 percent) and France (53.1 percent) are a much larger share.

We have the worst of both worlds — much higher costs in several areas and much lower revenues. Restructuring health care, our military and our justice system could save Americans at least 6 percent of GDP, or $1 trillion-plus annually. Resources are limited. We need to reduce military spending, restructure health care and reduce incarceration. Without such action, education at all levels, along with basic and applied research, will be underfunded; infrastructure will further deteriorate; valued social and cultural needs will go wanting. Our quality of life will lag other countries.

Montana, and other states, must raise adequate tax revenue. Montana is not a high-tax state. We have no sales tax, and fuel taxes remain much lower per highway mile traveled than in the past. President Trump’s claim that massive tax cuts will result in a reduced deficit and a prosperous U.S. is pure nonsense. Supply-side economics was debunked long ago.

Until elected officials escape the clutches of special interests in such areas as health care, defense and prison systems, higher taxes are essential to support key services and to ensure that “good government” accompanies “life, liberty, and the pursuit of happiness.”

Roger S. Smith is a retired economist who has been a consultant to the Organisation for Economic Co-operation and Development, World Bank, USAID and worked for the International Monetary Fund. He has served as a business school dean and vice president at a major public university. He grew up in Missoula and now lives on Flathead Lake.

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