Here in Spain we have the same system, PopsiclePete. We have lot's of taxes, about 40% of your earnings for a start, but we have free health, education, cheap university, you get some money when unemployed, pension...It work pretty well, with the normal flaws, but in my opinion this system has a consequence that must be taken into consideration. Most European countries (not the UK) don't have an army that deserves that name. As a result, the US usually bombs what needs to be bombed, like in Kosovo, and the EU pays the bill, reconstructing what the bombs destroy. Not being able to stop a genocide at the doorsteps of our territory is deeply embarrasing. We were unable even to reach consensus about what to do. Now that I think about it France also was against that action
Anyway, since then several governments in Europe (including the Spanish one) have started to build the EuroKorps, some kind of European Army. It has a looong way ahead, and not even the support of the big countries, but I think it is a necessity that we join our defense efforts to build a decent army that can be deployed anywhere in the world to do whatever needs to be done.
I think that's the problem that needs to be solved in Europe. This is probably not the case in Canada, PopsiclePete, as it is a bigger country. If our security could be kept by ourselves I think we would have a perfect system. But of course for a unified army we first need a unified foreign policy...and that sounds like Sci-Fi.
The day Morocco decides to invade our cities in the north of Africa we will see how far Europe's solidarity goes...