(Punditcy.com) – Of the many sacred liberties enjoyed by our great country, economic freedom has been in the forefront of everyone’s minds — in large part because of the federal overreach of President Obama’s signature healthcare legislation and proliferation of means tested government welfare. Economic freedom allows for individual trade with others as they see fit and in their best interest. It allow for sellers to create and offer products of their own design, and buyers then elect to purchase a product or not. The U.S. economy is the largest in the world due in no small part to the liberty and economic freedom we enjoy.
This specific freedom has been a beacon for many seeking a better life for over two hundred years. Despite the advantages of economic liberty, the progressive agenda continues to encroach on personal freedom.
The federal government has inserted itself into the free-market system in an attempt to correct what it has perceived as financial injustices instead of letting the market grow as dictated by the market and make necessary corrections. The result has been a marked decline in the economic freedoms previously enjoyed in the U.S. markets. The Heritage Foundation 2013 Index of Economic Freedom shows a continued decline in ranking of the U.S. for the fifth consecutive year, driven primarily by the massive increases in government spending and government regulation. Additionally, the report shows that the U.S. economy has not fully recovered from the recession of 2008. From the Heritage Report:
“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.”
- Rule of Law (property rights, freedom from corruption);
- Limited Government (fiscal freedom, government spending);
- Regulatory Efficiency (business freedom, labor freedom, monetary freedom); and
- Open Markets (trade freedom, investment freedom, financial freedom).
Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms. The U.S. overall index rating was 76 and ranked 10th with declines in monetary freedom, business freedom, labor freedom, and fiscal freedom.
Economic Freedom vs. Economic Growth
Economic growth, as the chart below indicates, is explicitly tied to the overall level of economic freedom available in a country. The more free an economy is the more growth it experiences. The economic policies employed since 2009 have made the U.S. less economically free which explains why the recovery from the 2008 recession has been the slowest recovery since the Great Depression.
To restore the U.S. to a place among the world’s “free” economies it will require significant policy reforms. According to the Heritage report, it will require reducing the size of government, overhauling the tax system, transforming costly entitlement programs, and streamlining regulations.
The federal government needs to get out-of-the-way of free enterprise so that a real economic recovery can be realized and stop playing politics with the lives of its citizens. When the government gets out-of-the-way, economically free nations prosper.
The above chart from the Fraser Institute Economic Freedom of the World report shows that the more free a nation is, the more robust their economy is. Additionally, a stronger and free economy benefits the poorer in that economy. The rhetoric that the poor are exploited by the wealthy is just that rhetoric. It is a political propaganda used by the progressive movement to incite class envy and further their agenda of establishing an all-powerful state. The below chart shows that in free economies, the poor are much better off. Economic Equality is not the right policy for the U.S.
In the end, these politics are not nearly as much about giving as it is about taking. Government should not be a tool for charity and a stifle for the economic machine. The government should not and cannot be a purveyor of charity because charity requires free will. Absent free will, charity becomes theft and gift becomes entitlement. It is true that economic freedom is not sufficient for building a just society, but believing that it is not necessary will be catastrophic to the U.S. economic future. The government’s proper role is to secure our freedom and to do no more.
U.S. Economic Freedom has has been time tested to be the most effective way to raise the economic status of all individuals, and the data proves it. Refusal of elected officials and government leaders to accept the historical data only proves that the push by the progressive left to move away from economic freedom is not based on fact and data, but on a deeply held ideology.