January 04, 2005

We're Number 11, We're Number 11!

No, not the Broncos who will have their hands full next week with Indianapolis's starters...

I'm discussing our nation's ranking as the eleventh freest nation in the Heritage Foundation/Wall Street Journal Index of Economic Freedom.

I quote this study all the time (including a sad Christmas exchange) because of the correlation. As Mary Anastasia O'Grady writes in OpinionJournal(free site)

Policy makers who pay lip service to fighting poverty would do well to grasp the link between economic freedom and prosperity. This year the Index finds that the freest economies have a per-capita income of $29,219, more than twice that of the "mostly free" at $12,839, and more than four times that of the "mostly unfree." Put simply, misery has a cure and its name is economic freedom.

This, friends, is my belief in a nutshell. "The affluence that our liberty has brought us" is a line I bore people with.

So, it is bittersweet to see the US ranked 11th, based on a high corporate tax burden and regulatory environment. I am glad to see freedom on the march (my beloved Ireland is kicking our ass at 5th...) but I don't plan to leave the US and hate to see the light of the world slide.

I read an article in The Economist that claims "A growing body of evidence suggests that the meritocratic ideal is in trouble in America." I did not share its pessimistic outlook. The main focus is on "income inequality" which to me is a sign of meritocracy, not a warning sign. The dynastic/not dynamic look at the political class was more worrisome -- the blood of our candidates does run pretty blue, but I don't think that is on the rise.

Before discarding the whole article, some points are well worth considering. Some of the "stickiness" impeding social mobility is the product of hyper-successful upward mobility in the 20th Century. Those people now naturally seek to entrench themselves and their children, drawing the gates behind them on some level.

My conclusion? Mirabile dictu, it's partisan! It is too easy to believe in our freedom and its concomitant prosperity. Yet each new tax and regulation draws us more toward France than Hong Kong. The GOP has been maligned as a vehicle for the religious right, but I say this study proves the real and more-present danger is a slow, eroding socialism as Democrats tax, regulate, control, and coerce a little more every Congress. Time to turn the State back.

Posted by jk at January 4, 2005 10:26 AM

Umm, 12? Tied with Switzerland? 11 is Chile. Yes, ahead of us on the economic freedom scale.

I offer some further observations:

At 14, Sweden is just behind us. This is a possible explanation for Jan Egelund's rebuke that America is "too stingy." He's just trying to get his welfare state ranked ahead of the worldwide icon of economic freedom - USA.

We're six nations behind the UK in economic freedom? Look how far we've slipped from the fresh faced idealists who threw off the chains of mother England for: economic freedom. (Remember that tea party in John Kerry's hometown?)

Don't fret about Hong Kong being ranked no. 1. That won't last long now that they're the lead ox of economic power for that "capitalist paradise" in country no. 112.

Posted by: johngalt at January 4, 2005 01:15 PM

And I also intended to mention, "nice post JK."

Posted by: johngalt at January 4, 2005 01:16 PM

We should follow Chile's lead in Social Security privatization, but yes, it is sad to follow them on this list.

Thanks for the kind words. I thought that I took "11" from the O'Grady article but it looks like I must roast alone. Yes, tied for twelfth anyway you view it.

Jingo fever has attacked me since I posted this. It's hard to call any of the nations ranked above us "more free." You can't defend your home in the UK, Ireland has (bad) public health care and a irreversible safety net. Denmark? Something smells rotten...Hong Kong has given up on press freedoms after a few years of 112's rule, hard to think more encroachment is not on the way.

The basic truth holds that free nations are wealthy nations. I guess I will have to splurge the $24.95 to buy it. I have quoted it enough times, I figure I owe them a sale.

Posted by: jk at January 4, 2005 02:14 PM
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