How would a communist USA pay for "free" health care and education?

In a time when all politicians are crying about too little money to pay for programs, and with an administration racking up the biggest deficits in history (even bigger than the Reagan deficits!), the problem of how to pay for social programs seems insurmountable.

However, there are large amounts of money available. One source would be to cut the military budget by half—still leaving us with the largest military budget of any country in the world (instead of as large as all other countries combined, as at present), and transferring the funds to social programs. That would amount to several hundred billion dollars per year. We could provide for all real defense needs if we weren’t maintaining hundreds of overseas bases, if we weren’t engaging in military adventurism to the tune of billions per year, if we didn’t run military construction on a “cost plus” basis to give super-profits to the military industrial complex.

If we returned the tax rates to the levels in the 1960s, with higher tax rates for the wealthy and corporations, that would raise additional hundreds of billions of dollars per year.

Such steps would be enough to pay for free health care and education for all, and for stepping up many other social programs, and for avoiding the manufactured “Social Security crisis” they keep trying to frighten us with.

None of these steps is revolutionary, just radical reformism—for example, returning to the tax rates of the 1960s wouldn’t cripple the capitalist system, capitalists made plenty of money in the 1960s, it was a boom period, so such tax rates aren’t “confiscatory.” But returning to those rates would solve the current massive budget deficits of the federal, state, and municipal governments.

If we go farther and take revolutionary steps, nationalizing the major industries and finance capital (banks, etc.), the profits, instead of enriching the wealthy, could be used to provide greatly increased benefits for the working class, the large majority of the population, those who in fact create all that wealth.

In other words, we favor progressive tax structures, favor increasing taxes on the wealthy, favor removing the cap on Social Security taxes (bringing in billions more every year and keeping that system financially solvent way past the baby boom retirement years by making the rich pay the same percentages as the rest of us). We oppose both flat rate taxes and sales taxes (except those on luxury goods), as falling heaviest on working families and the poor.

How would free education and free medical care be paid for? Right now, each year billions of dollars go into the pockets of already wealthy capitalists. That’s one source of money to pay for these changes. Right now much of our tax dollars go to making repayments on the national debt, billions of dollars a year, and this is another source of money—if the banks and other financial institutions are nationalized, then the democratic political structure can rationally decide on realistic repayment options and interest rates, freeing up much of this money for public benefits. Another source is that, contrary to the common claim that private business can do everything cheaper, many things can be done more cheaply by government, by pooling resources, by maximizing economies of scale, by eliminating unnecessary paperwork. Before you guffaw, since government right now causes much unnecessary paperwork, let me point to a program that works well. In Washington State, the state provides worker’s compensation benefits—provides the insurance for workplace injuries. Private insurance companies, on top of their profits, run about 20% administrative costs. Since they are banned from operating in the state (except for large employers who can set up their own programs under certain conditions), and the state thus covers everyone, they keep the administrative costs to about 2%! In years when the state’s investments are paying well, the program has actually returned money to the state treasury, since there are no profits and since administrative/paperwork costs are so low. No doubt many government programs don’t work this way, but it is possible, especially when they are not set up to provide profits to the private sector. This is another source of billions.

For another example, if we as a society continued to spend the same amount of money on health care each year, but had a single-payer nationalized health care system, we could cover everyone for the same amount we spend now. That’s right, for the same amount, everyone could be covered if we eliminated the profits and excessive administrative costs of the insurance companies, the for-profit health care chains, the pharmaceutical companies, and similar needless expenses.