American Elephants


U.S. Has Dropped to 17th in Economic Freedom! by The Elephant's Child

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The Fraser Institute, a British Columbia think tank in Vancouver, studies economic freedom in the world, and regularly ranks countries in order of the economic freedom they grant. Between 1980 and 2000, the United States has ranked third behind the two city states of Hong Kong and Singapore.

In the latest survey, the United States has fallen to 17th out of the 152 countries the Fraser Institute has surveyed. Seventeenth! The survey’s authors suggest the legal system of the U.S., protection of property rights, freedom of international trade and increasing regulations are stifling economic freedom in the United States.  Worse, the US has tied Venezuela (which comes in dead last —152nd — for the largest reduction in economic freedom ratings.

The Fraser Institute study said “Unless policies undermining economic freedom are reversed, the future annual growth of the US economy will be half its historic average of 3%.”

The Top Ten Economically Free Countries Are:

  1. Hong Kong
  2. Singapore
  3. New Zealand
  4. Switzerland
  5. United Arab Emirates
  6. Mauritius
  7. Finland
  8. Bahrain
  9. Canada
  10. Australia

Belgium, France, Germany, Greece, Italy, Luxembourg, the Netherlands, Portugal, and Spain have tumbled down the rankings over the past thirty years. Switzerland fell to 4th from 2nd, but the U.S. decline from 3rd to 17th was one of the largest — except for Greece which fell from 33rd to 78th, Italy fell from 49th to 70th, and Luxembourg fell from 6th to 25th.

Denmark, Finland, Iceland, New Zealand, Poland, Sweden and the United Kingdom (from 17th up to 9th), have all markedly improved.

The Bottom Ten

  1. Algeria
  2. Democratic Republic of the Congo
  3. Burundi
  4. Central African Republic
  5. Angola
  6. Chad
  7. Zimbabwe
  8. Republic of Congo
  9. Myanmar
  10. Venezuela

Countries formerly colonized by the United Kingdom have done better than countries colonized by other European colonial powers, which the authors attributed to the English common law system left behind by colonial administrators.

The English common law system provides for greater stability and protection under the law than French civil law. Under English common law legal changes occur as a result of precedents derived from judicial decisions rendered by judges. This leads to more gradual changes and greater constraint on the ability of political decision-makers to alter the law. No such check is present under civil law. Former English colonies had a higher mean per-capita income of $4,415 compared to others $3,725.

The object of the Left is always more control of the economy. And they just controlled us into the biggest drop, a tie with Venezuela, in the entire study. President Obama frequently remarks that excessive regulation has nothing to do with business. Nothing to see here, just move along. Of course over-regulation puts a damper on business, and on entrepreneurship. Who wants to start a new business when they don’t know what might be regulated next? There is a reason why so many businesses are sitting on hoards of cash. Business keeps telling the administration, and the administration keeps ignoring the problem. That’s what they are talking about when they speak of “the business climate.” High taxes and over-regulation adds up to a bad business climate.


3 Comments so far
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Their is little real economic freedom in US. The megabanks and megacorps control everything and right to vote is mere illusion of democracy. The ability to become an entrepreneur of any sort is severely limited.

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Comment by Carl D'Agostino

Big corporations are not bothered by small entrepreneurs, but by medium-sized companies who are becoming competitors. Surprisingly one of the big problems for people who want to start a small business are regulations promoted by trade groups (cosmetologists have managed to get regulations that require a license for anybody who touches hair, which can only be granted by graduating from cosmetology school —but requiring that for hair-braiders in the black community is absurd. They do amazing and beautiful work which the graduates of cosmetology school probably couldn’t do anyway). The decorators have tried several times to keep people who do not have CID or ASID certification from using the term designer or decorator on the state ballot. A newer version of the medieval craftsman/trade wars. But for many, these are individual crafts and the trade groups are trying to prevent competition, which hits poorer individuals.
I think we underestimate the role of regulation and red-tape on business. Michelle’s bright idea about improving the American diet by demanding ingredients and calorie counts on those restaurant signs where you order your Pizza are a huge deal (list the ingredients in your favorite kind of pizza and then count up how many kinds the restaurant has). Heritage has done a good job of summarizing the regulations and red-tape this administration has imposed on business. Go to their website and enter either regulation or red tape in the search bar.

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Comment by The Elephant's Child

ooops – correct their to there

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Comment by Carl D'Agostino




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