Is It Biden's Influence? OECD Says Citizens of Member Countries Increasingly Prefer Big Government

President Joe Biden of the United States [Photo by Reuters-Yonhap News]

[Asia Economy Reporter Park Byung-hee] The Organisation for Economic Co-operation and Development (OECD) released a report on the 27th (local time) stating that preferences for a larger government have increased following the COVID-19 pandemic.

Bloomberg News, citing the OECD report, diagnosed that concerns about health and the economy have risen due to the COVID-19 pandemic, leading to increased demands for greater government spending in most wealthy countries worldwide. Bloomberg added that many people are calling for expanded government spending despite knowing that it means higher taxes.

The OECD conducted a survey of about 25,000 citizens aged 18 to 64 from 25 member countries.

As a result, 37% of respondents said that at least one family member lost their job due to COVID-19. Among those who reported having a family member who lost their job, 60% said they want the government to increase spending for a better employment market. Even among respondents without a family member who lost their job, 48% expressed a desire for expanded government spending.

Among all respondents, 22% said they would pay an additional 2% of their income in taxes to support employment systems. Furthermore, 45% said they would pay more taxes if it were to support healthcare systems.

The OECD analyzed in the report, "Many people are dissatisfied with the current government social protection measures," adding, "Most want a more costly and higher-quality social safety net and even believe they must pay more taxes."

The OECD also warned about the risks of entrenched economic insecurity. Among respondents with a family member who lost their job, 81% expressed concerns about whether they could be economically and socially happy in the next 1 to 2 years. Additionally, 60% said they feel anxious about needing skills to secure a safe job that lasts more than 10 years.

Therefore, the OECD diagnosed that without strong policy responses, citizens of OECD member countries may suffer economic hardships related to COVID-19 for several years to come.

Bloomberg analyzed that U.S. President Joe Biden might be increasing global preferences for a larger government.

This is because President Biden has pursued a large-scale government approach by rolling out trillion-dollar stimulus packages shortly after taking office. In March, Biden approved a $1.9 trillion stimulus bill and immediately proposed two bills under the name of infrastructure investment. Earlier, he proposed the $2.25 trillion "American Jobs Plan" bill and revealed details of the $1.8 trillion "American Families Plan" bill during a joint session of Congress on the 28th. The "American Families Plan" bill is a welfare policy that expands social safety nets such as education and childcare but is a long-term investment for America's future competitiveness. The total stimulus package, approaching $6 trillion, is nearly 30% of the U.S. Gross Domestic Product (GDP).

President Biden also plans to pursue tax increases to fund the large-scale fiscal spending. It is known that he is pushing to raise the corporate tax rate from 21% to 28%, and to increase the top income tax rate for those earning over $400,000 annually and the top capital gains tax rate for those earning over $1 million from the current 37% and 20%, respectively, to 39.6%.

This content was produced with the assistance of AI translation services.