According to the newly released global Index of Economic Freedom, the United States is about to fall out of the Top Ten :
When institutions protect the liberty of individuals, greater prosperity results for all.
Economist Adam Smith formed this theory in his influential work, The Wealth of Nations, in 1776. In 2013, his theory is measured – and proven – in the Index of Economic Freedom, an annual guide published by The Wall Street Journal and The Heritage Foundation, Washington’s No. 1 think tank.
For over a decade, The Wall Street Journal and The Heritage Foundation, Washington’s preeminent think tank, have tracked the march of economic freedom around the world with the influential Index of Economic Freedom. Since 1995, the Index has brought Smith’s theories about liberty, prosperity and economic freedom to life by creating 10 benchmarks that gauge the economic success of 185 countries around the world. With its user-friendly format, readers can see how 18th century theories on prosperity and economic freedom are realities in the 21st century.
The Index covers 10 freedoms – from property rights to entrepreneurship – in 185 countries.
The index ranks countries on a scale of 1-100. A score of 80-100 defines a country as “Free.” Hong Kong, Singapore, New Zealand, Australia, and Switzerland are the only countries fitting that category, according to the index.
A score of 70-79.9 puts a nation in the “mostly free” category. Canada, Chile, Mauritius, and Denmark are followed by the good ol’ US of A. The United States scores a 76 — followed closely by Ireland at 75.7:
The United States, with an economic freedom score of 76, has lost ground again in the 2013 Index. Its score is 0.3 point lower than last year, with declines in monetary freedom, business freedom, labor freedom, and fiscal freedom. The U.S. is ranked 2nd out of three countries in the North America region, and its score remains well above the world and regional averages.
Registering a loss of economic freedom for the fifth consecutive year, the U.S. has recorded its lowest Index score since 2000. Dynamic entrepreneurial growth is stifled by ever-more-bloated government and a trend toward cronyism that erodes the rule of law. More than three years after the end of recession in June 2009, the U.S. continues to suffer from policy choices that have led to the slowest recovery in 70 years. Businesses remain in a holding pattern, and unemployment is close to 8 percent. Prospects for greater fiscal freedom are uncertain due to the scheduled expiration of previous cuts in income and payroll taxes and the imposition of new taxes associated with the 2010 health care law.
Restoring the U.S. to a place among the world’s “free” economies will require significant policy reforms, particularly in reducing the size of government, overhauling the tax system, transforming costly entitlement programs, and streamlining regulations.
Sounds like good advice there. How have our “leaders” — in both parties — responded to our economic challenges?
The U.S. economy, the world’s largest, has not recovered fully from the 2008 financial crisis and ensuing recession. Under Democratic President Barack Obama, the federal system of government, designed to reserve significant powers to the state and local levels, has been strained by the national government’s rapid expansion. Spending at the national level rose to over 25 percent of GDP in 2010, and gross public debt surpassed 100 percent of GDP in 2011. A 2010 health care bill greatly expanded the central government’s regulatory role, and the Dodd–Frank financial overhaul bill roiled credit markets. The election of a Republican Party majority in the House of Representatives in late 2010 slowed spending growth, but the divided government that has left economic policy in flux seemed likely to continue following the reelection of President Obama in 2012.
Just yesterday, our “leaders” in DC foresook the opportunity to cut taxes and spending and regulations to set aside even more money we don’t have to pay for MORE unemployment insurance. *Oh, THAT’LL surely pull our chestnuts out of the fire.*