U.S. Economic Freedom Hits Historic Low
The United States is no longer among the world’s top 15 freest economies. In fact, according to an annual index released by the Heritage Foundation on Wednesday, the U.S. fell from being the sixth-freest economy in the world when President Barack Obama took office in 2009 to being the 17th freest economy in the world today.
The U.S. economic freedom score for 2017 was 75.1 out of 100. This means economic freedom in the U.S. has fallen to its lowest level since the Heritage Foundation started keeping track in 1995. America now ranks behind such nations as Chile, Estonia, Hong Kong, Singapore and the United Arab Emirates. Since the Heritage Foundation ranks countries with scores above 80 as economically “free,” it has only ranked the U.S. as “mostly free” since 2009.
The Heritage economic freedom index is calculated based on 12 factors of economic freedom, including property rights, government spending, freedom from corruption, fiscal freedom, monetary freedom, business freedom, labor freedom, trade freedom, investment freedom and financial freedom. The 2017 report lists large budget deficits, an enormous national debt, a substantial expansion of government bureaucracy and an increased tax burden as contributing factors to the decline in America’s economic freedom.
Another index of economic freedom, published by the Fraser Institute, shows that the U.S. fell from being second freest economy in 1980 to being the 16th freest economy in 2014. According to this assessment, U.S. economic freedom actually rose from 1980 to 2000 but has been in steady decline since the turn of the millennium.
The Fraser Institute reports that the U.S. economic freedom index fell from 8.07 to 7.75 between 1980 and 2014, while China’s economic freedom index rose from 3.64 to 6.45 during the same time period. As the U.S. turns its back on Adam Smith-style capitalism and China turns its back on Mao Zedong-style communism, both nations are adopting a mixed socialist market economy where property is privately owned but micromanaged by government bureaucrats.
Germany and most members of the European Union also have economic freedom scores in the “moderately free” zone, a category associated with mixed socialist market economies and authoritarian bureaucracies.
For the past two centuries, the form of government championed by Britain and America—a form of government that has at its heart some important biblical principles—has spread throughout the Western world. Yet, in recent years, nations around the globe have been turning their back on the Anglo-American methods of economic management.
Even many key American officials have adopted an approach similar to Barack Obama’s philosophy that nations should not debate the ideologies of capitalism and communism, but instead should pursue a mixed economy that uses bits of Communist theory and bits of capitalist theory.
To see where this dangerous decline in economic freedom is leading, please read “Democracy Is Dying.”