Regulation, taxes and
debt knock the U.S. out of the world's top 10.
by Terry Miller
World economic freedom
has reached record levels, according to the 2014 Index of Economic Freedom,
released Tuesday by the Heritage Foundation and The Wall Street Journal. But
after seven straight years of decline, the U.S. has dropped out of the top 10
most economically free countries.
For 20 years, the
index has measured a nation's commitment to free enterprise on a scale of 0 to
100 by evaluating 10 categories, including fiscal soundness, government size
and property rights. These commitments have powerful effects: Countries
achieving higher levels of economic freedom consistently and measurably outperform
others in economic growth, long-term prosperity and social progress. Botswana,
for example, has made gains through low tax rates and political stability.
Those losing freedom,
on the other hand, risk economic stagnation, high unemployment and deteriorating
social conditions. For instance, heavy-handed government intervention in
Brazil's economy continues to limit mobility and fuel a sense of injustice.
It's not hard to see
why the U.S. is losing ground. Even marginal tax rates exceeding 43% cannot
finance runaway government spending, which has caused the national debt to
skyrocket. The Obama administration continues to shackle entire sectors of the
economy with regulation, including health care, finance and energy. The
intervention impedes both personal freedom and national prosperity.
But as the U.S.
economy languishes, many countries are leaping ahead, thanks to policies that
enhance economic freedom—the same ones that made the U.S. economy the most
powerful in the world. Governments in 114 countries have taken steps in the
past year to increase the economic freedom of their citizens. Forty-three
countries, from every part of the world, have now reached their highest
economic freedom ranking in the index's history.
Hong Kong continues to
dominate the list, followed by Singapore, Australia, Switzerland, New Zealand
and Canada. These are the only countries to earn the index's "economically
free" designation. Mauritius earned top honors among African countries and
Chile excelled in Latin America. Despite the turmoil in the Middle East,
several Gulf states, led by Bahrain, earned designation as "mostly
free."
A realignment is under
way in Europe, according to the index's findings. Eighteen European nations,
including Germany, Sweden, Georgia and Poland, have reached new highs in
economic freedom. By contrast, five others—Greece, Italy, France, Cyprus and
the United Kingdom—registered scores lower than they received when the index
started two decades ago.
The most improved
players are in Eastern Europe, including Estonia, Lithuania and the Czech
Republic. These countries have gained the most economic freedom over the past
two decades. And it's no surprise: Those who have lived under communism have no
trouble recognizing the benefits of a free-market system. But countries that
have experimented with milder forms of socialism, such as Sweden, Denmark and
Canada, also have made impressive moves toward greater economic freedom, with
gains near 10 points or higher on the index scale. Sweden, for instance, is now
ranked 20th out of 178 countries, up from 34th out of 140 countries in 1996.
The U.S. and the U.K,
historically champions of free enterprise, have suffered the most pronounced
declines. Both countries now fall in the "mostly free" category. Some
of the worst performers are in Latin America, particularly Venezuela,
Argentina, Ecuador and Bolivia. All are governed by crony-populist regimes
pushing policies that have made property rights less secure, spending
unsustainable and inflation evermore threatening.
Despite financial
crises and recessions, the global economy has expanded by nearly 70% in 20
years, to $54 trillion in 2012 from $32 trillion in 1993. Hundreds of millions
of people have left grinding poverty behind as their economies have become
freer. But it is an appalling, avoidable human tragedy how many of the world's
peoples remain unfree—and poor.
The record of
increasing economic freedom elsewhere makes it inexcusable that a country like
the U.S. continues to pursue policies antithetical to its own growth, while
wielding its influence to encourage other countries to chart the same
disastrous course. The 2014 Index of Economic Freedom documents a world-wide
race to enhance economic opportunity through greater freedom—and this year's
index demonstrates that the U.S. needs a drastic change in direction.
Source:
Wall Street Journal By Terry Miller Jan. 13, 2014 8:05 p.m. EThttp://online.wsj.com/news/articles/SB10001424052702303848104579308811265028066?mg=reno64-wsj&url=http%3A%2F%2Fonline.wsj.com%2Farticle%2FSB10001424052702303848104579308811265028066.html
Comments:
The list of 178 countries plus 8 countries (unrated)
appear in the article. The table shows
the U.S. in 12th place, having fallen from 3rd place in
2001 according to Fraser Institute. http://www.freetheworld.com/countrydata.php?country=C135&x=75&y=18
Several organizations publish a “freedom index” Fraser
Institute at freetheworld.com shows the U.S. in 12th place on the
list, but mentions it in 17th place. Cato Institute ranks the U.S.
in 17th place, Heritage puts the U.S. in 12th place http://www.heritage.org/index/ranking each have their own criteria.
Norb Leahy Dunwoody GA Tea Party Leader
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