The United States, once a beacon of economic freedom globally, has plummeted in the rankings of economic freedom over the years. “The U.S. once ranked No. 4 in the world, but we’ve been in decline. This year, we’re 25th,” says the Heritage Foundation.
In a bid to understand why, the Heritage Foundation’s Derrick Morgan says, “If you care about living a prosperous life, you should care about what government economic policies are.” In the pursuit of providing welfare to citizens, governments often declare a slew of promises such as free healthcare, childcare, and cellphones.
However, the delivery of these promises doesn’t come without a price, often infringing upon our freedoms and economic stability. Government, as it is, operates through force and every law it enacts tends to encroach upon our finances or our freedom, or even both.
The major reason for this decline is the rampant overspending by Congress, which far exceeds the revenue accrued from taxes. In a comment on policies offering free services, Morgan replies, “Sooner or later, you run out of other people’s money. More dollars chasing fewer goods leads to inflation,” which ultimately curtails financial freedom.
Politicians also limit our freedom by banning choices and implementing thousands of regulations, which constrain individual freedom. “Those are examples of our smothering government and why we keep dropping places,” adds Morgan.
The narrative is worse in countries with more oppressive governments such as India, Sudan, Venezuela, Cuba, and North Korea, where economic and political freedom are stifled. Conversely, economically free countries like Taiwan, Ireland, Switzerland, and Singapore are doing much better. “The freer a country is economically, the better off they are,” states Morgan.
However, economic freedom alone doesn’t guarantee overall liberty. The case of Singapore, where speech isn’t free and assembly needs police permits, is a stark reminder of this fact. Morgan acknowledges, “This isn’t a measure of freedom overall. It’s a measure of economic freedom. Other freedoms are important, religious freedom…First Amendment freedom.”
The Cato Institute’s Human Freedom Index, considering both economic and personal freedom, rates Switzerland, New Zealand, Estonia, and Denmark as the freest countries. America is 23rd, while Singapore is 44th. The emphasis lies in long-term observation of whether economic freedom results in a freer, more prosperous, healthier, and cleaner environment. Morgan concludes by cautioning citizens, “They’re going to offer you free stuff… but their policies are in all likelihood going to make things worse.”
