For 20 years, the Wall Street Journal and the HeritageFoundation have scored and ranked the nations of the world according to economic freedom, using measurements of each nation’s commitment to the rule of law, property rights, open markets, and small government with minimal regulations, among other things. This yearly index has demonstrated clearlythat economic freedom is tied directly to prosperity and, conversely, to the lack of poverty and even environmental degradation.
It’s also abundantly clear the United States has much to worry about.
Of the 178 nations in the index, only the United States has suffered seven straight years of decline. The latest report, released this month, shows the United States has fallen from the top 10 freest nations, now ranking 12th with the designation of “mostly free.”
The reasons for this tend to be immediately swallowed up in partisan politics. Mention them and ideological walls are erected, ready made talking points emerge and opponents become caricatured and demonized. The organizations that sponsor the index are conservative in nature, so many immediately discount their findings. And yet the index’s results correlate nicely with global poverty rates, social unrest, environmental degradation and official corruption. Each of these increases as economic freedom decreases.
For much of the world, the news is good. The index’s overall global score is the highest it ever has been. Four nations — Colombia, Poland, United Arab Emirates and Indonesia — have made impressive gains, and their people are emerging with a sense of optimism and empowerment.
But in the United States, the Affordable Care Act has added new regulatory layers onto health care that makes it more difficult for businesses to prosper. Financial regulations have hampered investment. A backlog of bureaucratic rule-making arising out of new legislation has left businesses feeling uncertain and unwilling to spend. Partisan bickering shut down the government for a time recently. And even with the federal income tax taking 39.6 percent from the top earners, the nation is nowhere near meeting its burgeoning obligations.
With government increasing in size and intervention, increases in corruption, and in the perception of corruption, naturally follow.
Some may find it ironic, but the less a government interferes with personal economic freedom, the better its people become educated, and the more effective is its health care system. This also is documented by the index. As the editors wrote, “People crave liberation from poverty, and they hunger for the dignity of free will. By reducing barriers to these fundamentals, the forces of economic freedom create a framework in which people can fulfill their dreams of success.”
For many people of the world, those barriers are being lifted. The United States, historically the beacon of freedom, ought to be leading the way, not falling behind Chile, Mauritius and Estonia. It should at least be leading the North American region, not languishing far behind Canada, whose economy is ranked as solidly free.
Jim DeMint, president of The Heritage Foundation, wrote, “People will not fight for freedom unless they understand it, value it, and believe it is at risk.”
The Great Recession seems to have made many Americans unsure of their guiding principles. It’s time for that uncertainty to end.