Their cost-of-living link just leads to OECD stats that are used as basis of computing PPP.
So the cato article makes 2 mistakes: applying the PPP normalization twice (once by using "PPP normalized income" and a second time in adding the ~30% from the "cost of living"), in addition to ignoring what you get in exchange for the taxes that lower your purchasing power.
So the cato article makes 2 mistakes: applying the PPP normalization twice (once by using "PPP normalized income" and a second time in adding the ~30% from the "cost of living"), in addition to ignoring what you get in exchange for the taxes that lower your purchasing power.