America’s Economic Freedom Has Rapidly Declined Under Obama

Heritage Foundation ^ | February 1, 2016 | Anthony B. Kim

[1rudeboy]

Millions of people around the world are emerging from poverty thanks to rising economic freedom. But by sharp contrast, America's economic freedom has been on a declining path over the past decade.

America's declining score in the index is closely related to rapidly rising government spending, subsidies, and bailouts.

According to the 2016 Index of Economic Freedom, an annual publication by The Heritage Foundation, America's economic freedom has tumbled. With losses of economic freedom in eight of the past nine years, the U.S. has tied its worst score ever, wiping out a decade of progress.

The U.S. has fallen from the 6th freest economy in the world, when President Barack Obama took office, to 11th place in 2016. America's declining score in the index is closely related to rapidly rising government spending, subsidies, and bailouts.

Since early 2009:

• Government spending has exploded, amounting to $29,867 per household in 2015.
• The national debt has risen to $125,000 for every tax-filing household in America--a total over $18 trillion.
• The government takeover of health care is raising prices and disrupting markets.
• Bailouts and new government regulations have increased uncertainty, stifling investment and job creation.

This is not something to take lightly. Economic freedom is the foundation of U.S. economic strength, and economic strength is the foundation of America's high living standards, military power, and status as a world leader. The perils of losing economic freedom are not fictional.

It is painfully clear that our economy has been performing far below its potential, with individuals, families, and entrepreneurs being squeezed by the proliferation of big-government bureaucracy and regulations.

As documented by the index, and by other scholars, America's economic freedom has been declining at an alarming pace.

Indeed, as The Wall Street Journal recently summed it up succinctly, Obama is "a champion when it comes to limiting economic freedom, and American workers have the slow growth in jobs and wages to prove it."

Not surprisingly, our economic dynamism and innovative capacity have been measurably reduced.

Not surprisingly, our economic dynamism and innovative capacity have been measurably reduced. Self-inflicted wounds include:

• The U.S. has the highest corporate tax rate in the developed world. This has driven new jobs to other, more competitive nations and has meant fewer jobs and lower wages for Americans.
• The overall annual cost of meeting regulatory requirements has increased by over $80 billion since 2009, with more than 180 new regulations in place. In terms of ease of starting a new business, analyzed by a recently published World Bank report, the U.S. is ranked shockingly low at 49th, trailing countries such as Canada, Georgia, Ireland, Lithuania, and Malaysia.

No wonder the labor force participation rate has remained at near record lows after more than five years of steady decline.

Worse, vibrant entrepreneurial growth has been stymied by greater policy uncertainty and mounting debt. And a disturbing trend toward cronyism has gravely eroded the rule of law and distorted our free-market system.

House Ways and Means Committee Chairman Kevin Brady, R-Texas, keynote speaker of the official release of the 2016 Index, recently stated:

It's been almost seven years since the Obama "recovery" began, and our economy is barely out of neutral. Why does America have to settle for this?

Restoring economic freedom is prerequisite to revitalizing and brightening America's future. 2016 is the year to reaffirm the principles of limited government, free enterprise, and rule of law so that we can reconstitute an America where freedom, opportunity, and prosperity flourish.

The time to act is now.

[uncitizen]

What do they want us to do? Elect a RINO? No thanks. No Rubio. No more RINOS!

[datricker]

Just like everything else save government intrusion

[Slyfox]

[unixfox]

America's Economic Freedom Has Rapidly Declined Under Obama

EXACTLY what he wanted.

[1rudeboy]

In other countries that FReepers follow closely:

• Canada is ranked 6,
  
• United Kingdom is ranked 10,
  
• Germany is ranked 17,
  
• France is ranked 75, and
  
• Russia is ranked 153.

[kindred]

I have no doubt all of Americans freedoms and liberties are under attack by the DC hellions and their evil subordinate would be dictator minions.

[kindred]

Sounds like everything the Marxist postus and his minions do.

[Slyfox]

Hitlary worked from the same list in her time as president.

What saved us from her evil work at the time was the 1994 Congress.

[Mase]

Had no idea the damage was so significant. You know it's bad when Canada and the UK beat you. I'm sure, to many, the protection offered by the populists running for POTUS and congress is exactly what this country needs.

With their vision, maybe we can challenge France in the near future.

[DannyTN]

1. Trump will bring down government spending. He is frugal in his own affairs. He is used to managing a large organization and will select leaders who will bring a business sense to the various government agencies. What's more he knows how to measure progress and will be quick to change leaders and/or methods if progress isn't being made.
2. Trump has long complained against the size of the debt. He will bring it down by getting the American economy going again. Which will generate tax revenues without rate increases and decrease safety net payments.
3. Trump will restore market place initiatives for health care. He has indeed been against Obamacare from the start.
4. Trump is likely to reduce regulation. He will support bailouts if it's critical to our economy. But if he restores the tariffs, the need for bailouts will be sharply reduced.
5. Trump has plans to restore jobs and wages. He will restore the import tariffs and/or negotiate balanced trade deals instead of deals where they sell into our markets but don't buy anything but our debt and equities in return. He will also rebuild and repair our infrastructure. And he is a builder. He won't be channeling the funds to his "bundlers" like Obama did. He will be building infrastructure and the wall and anything else we actually need.
6. restoring manufacturing will improve our "economic dynamism and innovative capacity"
7. Trump wants to lower corporate taxes...tariffs and income taxes from people returning to work would give him the means to do that and lower individual taxes as well.
8. Trump is a businessman, he is more likely to remove red tape on starting a business than others.
9. Trump will restore the rule of law and work with congress when laws need to change.

[Vaduz]

94 million unemployed people agree.

[lentulusgracchus]

[Article, quoting WSJ] American workers have the slow growth in jobs and wages to prove it [that it's all Obama's fault] ."

Of course, that slow wage growth wouldn't be a function of the huge and accelerating growth of L-1 and H-1B and now H-2B (unskilled) labor immigration shoving American workers aside in favor of lower-paid Asians, and the uncontrolled flood of unskilled and semi-skilled labor across the southern border.

Until 9/11 forced them to stuff a sock in it, the WSJ was constantly pounding the table for uncontrolled immigration. At one point, a WSJ editorial demanded that the Constitution be amended to read, "There shall be open borders", quote unquote.

[lentulusgracchus]

... I'm sure, to many, the protection offered by the populists running for POTUS and congress is exactly what this country needs.

Historically, Democrats in the 19th century were the free traders, constantly fighting off the tariffs proposed by the Federalists and Whigs.

Whigs and Republicans have always been the protectionists.

[lentulusgracchus]

Is your list from the economic freedom index, or the World Bank's index of ease of starting a new business?

[1rudeboy]

That is from Heritage’s Index.

[Mase]

The 16th Amendment that gave us a federal income tax came from Republicans supporting the tax in return for democrat support of a tariff (Payne-Aldrich). The stupid party was alive and well even back then.

Since the end of WWII, however, most republicans and democrats have supported free trade because they understood the many benefits. That appears to be changing with the rising tide of populism. If so, we'll get what we deserve.

[lentulusgracchus]

If so, we'll get what we deserve.

As opposed to just taking what the mercantilist nations have been dishing out?

"Fair trade" can be free trade if the counterparties will agree to it and stick with their undertakings. Otherwise, our workers just get screwed by offshoring.

[Mase]

If these other nations want to hurt themselves why should we interfere?

Fair trade only exists when there is free trade. Otherwise, fair trade means government determines winners and losers. History shows us how that works out. Workers don't need government to protect them. They need government to get the hell out of the way.

[lentulusgracchus]

They need government to get the hell out of the way.

That would be all governments.

As long as socialist states like India and Mexico are grossly subsidizing their societies' staples, housing, and fuel costs (like gasoline in Mexico), their workers can and do afford to accept much lower top-line comp. Our guys are competing with wage offers in Chittagong and Calcutta and Guadalajara, but the other side is subsidized.

American employers who offshore or import H-1/H-2/L-1 green-card foreign workers are effectively arbitraging top-line wages. It's a financial game set up by foreign societies' leaderships, and we need to break it up so our people can compete properly, on a level playing field.