Economic Freedom Index Top 10 Countries – US Did Not Make The List
The Economic Freedom Index is a joint publication by the Wall Street Journal and the Heritage Foundation. Ten distinct set of criteria are used to measure a nation’s economic health. The measurements are based upon fiscal freedom, government spending, trade freedom, and corruption, among other statistics.The United States economic freedom ranking has been on a downward spiral over the past five years, according to the report. Ranking number 12 on the list means that America is now just “mostly free” economically. The decline is reportedly based upon “poor showings” in the business freedom, fiscal freedom, and property rights categories.
America’s longstanding world power designation was at least partly established due to a thriving and robust economy. The United States is now ranked behind China, Hong Kong, Estonia, Singapore, and several other nations. When President Barack Obama took office America ranked sixth on the annual list. When informed about the ranking of the United States on the 20th annual list, former US Senator and Heritage Foundation President Jim DeMint called it an “Unfortunate but foreseeable slide. It should stun everyone.”
America scored 75.5 points on the scale based on 100 overall possible points. Under the Rule of Law category the United States slipped down to 80 points in the property rights sections and went up to 72 points in the freedom from corruption section. Details about the Rule of Law ranking state that an “expansive use of government regulatory agencies to manage economic activity” played a huge role in the low score, which would essentially be a C average.
Under the Limited Government category, the USA scored 48.1 points in the government spending section and 65.8 points in the fiscal freedom section. In the Regulatory Efficiency category America dropped down to 89.2 points in the business freedom section, 97.2 points in the labor freedom section, and 75.4 points in the monetary freedom section. In the Open Markets category the US earned 86.8 points in the trade freedom section, and 70 points in both the financial freedom and investment freedom sections.
An excerpt from the Economic Freedom Index report reads:
“The US is ranked 2nd out of three countries in the North America region, and although its score remains well above the world and regional averages, it is no longer one of the top 10 freest economies. Over the 20-year history of the Index, the U.S.’s economic freedom has fluctuated significantly. During the first 10 years, its score rose gradually, and it joined the ranks of the economically “free” in 2006. Since then, it has suffered a dramatic decline of almost 6 points, with particularly large losses in property rights, freedom from corruption, and control of government spending. The US is the only country to have recorded a loss of economic freedom each of the past seven years. The overall U.S. score decline from 1995 to 2014 is 1.2 points, the fourth worst drop among advanced economies.”
The report went on to state that significant expansion in both the scope and size of government, through recently passed and expensive regulations in areas such as health care and finance contributed “significantly to the erosion of US economic freedom. The growth of government has been accompanied by increasing cronyism that has undermined the rule of law and perceptions of fairness.”
Countries which joined the United States of America in the “mostly free” category include: Bahrain,Lithuania, Chile, Czech Republic, Taiwan, Luxembourg, South Korea, Qatar, Macau, Colombia,and Bostwana. Nations which were included in the top 10 or “free” category also in numerical order include: Hong Kong, Singapore, Australia, Switzerland, New Zealand, and Canada. Chile, Mauritius, Ireland, Denmark, and Estonia all ranked ahead of America. France and South Africa landed in the “moderately free” category with Slovenia, Panama, and Portugal. Brazil, Sierra Leone, Kenya, and Vietnam were listed among the countries in the “mostly unfree” section of the annual Economic Freedom Index.
Countries on the “repressed” list include the Ukraine, Haiti, Argentina, Iran, Venezuela, and Cuba and North Korea in the lowest two spots. A total of eight countries were not ranked and included the Sudan, Syria, Libya, Kosovo, Afghanistan, and Iraq.
[Image Via: Shutterstock.com]
