US ranks only eighth in the world in "Economic Freedom"

Great Debates
1

And this is according to the Heritage Foundation, a right-wing think tank (oxymoron, anyone?). The have devised a scale of Economic Freedom, which they define thusly:

So, after all the data is tabulated, the US has fallen to eighth in the world.

Ouch! How could this have happened?

Here is the kicker: Of the seven countries deemed more economically free than the US, six of them have universal health care!

Australia, Hong Kong, Singapore, New Zealand, Ireland and Canada all rank higher by the Heritage Foundation as more “economically free” than the United States, yet they all have universal health care. Switzerland has private health insurance, but it is mandatory, and those who cannot afford it can buy insurance from the government (can you say “public option”?)

So there you have it; the most conservative think tank in the country has compiled the data, and all we have to do is read it.

What more will it take to convince conservatives that universal health care will make them more economically free, not less?

2

Nothing short of LSD therapy, I’m afraid.

3

I’m sort of quasi-for the whole health care reform thingy, but surly you don’t believe that UHC is the only factor in determining how economically free (or not) a country is…do you? Or that, by getting UHC in the US (not that this is likely to happen anytime soon) this will magically catapult the US into the number one position…do you?

BTW, what are you basing your assertion that the Heritage Foundation is the ‘most conservative think tank in the country’ on? Just curious, as I’m only vaguely aware of them, in general.

-XT

4

I do not. But it is clear from this ranking that universal health care will not make the country less economically free. These countries have decades of experience with universal health care, and nothing like what the chicken littles on the right have predicted ever came to pass.

It certainly won’t stand in the way, as has been claimed by the right.

Based on their previous positions on the issues, as well as their mission statement:

Of course, it is a subjective judgement. If you have a nominee for a think tank that is more conservative, I’m all ears.

5

The Heritage Foundation also supported Obamacare before they were against it :

http://thinkprogress.org/2010/04/10/heritage-romneycare/

6

:stuck_out_tongue: No, I don’t. I don’t actually read, follow or even know many conservative think tanks at all…that’s why I asked. You obviously do.

Well, that’s hard to say, really. I don’t THINK it will, but then, it really depends on how it’s implemented, how it’s run, and how much it costs. There at too many variables to really determine how it might work out, especially since that isn’t what we ARE getting.

Well, it might. Depends on how they calculated their tables. If it was only a small part of what constituted the various freedoms they are talking about, then even if it was a negative, it might have been outweighed by other factors that those other countries have and we don’t.

-XT

7

Yay, Canada! True North, strong and free! Suck it, yanks!

8

You’re little aside about the oxymoron was not only unnecessary but indicates that you’re not really interested in discussing the topic with anyone who might be right wing.

9

Certainly not with conservatives who search for excuses to avoid confronting the truth.

10

Something tells me they don’t conceive of ‘the right to control his or her own labor’ quite like I do …

11

I’m sorry, I can’t hear what they’re saying over the clanking of our gold medals. :smiley:

12

This is not a logical conclusion. It could be that those countries have much more economically free policies in other areas, and UHC reduces their freedom yet not enough to rank them below us. You cannot infer that the presence of UHC is a causitive factor in their greater economic freedom anymore than you could say they all use smaller cars or drink more alcohol than us, therefore using smaller cars or drinking more will make us more economically free.

You could use this as evidence against the idea that having UHC will turn us into the Soviet Union (and this is obvious to anyone with even a tenth of a brain), but not the point you’re trying to make.

13

I really can’t take the Heritage foundation seriously.

If you look at their definition of trade freedom it includes things like

“safety and industrial standards regulations; packaging, labeling, and trademark regulations; advertising and media regulations.”

Which when you look at all the tainted products coming out of China, I don’t consider ‘safety and industrial regulations’ a bad thing.

Then they criticize “national taxes and social insurance” which doesn’t make sense to me. Social insurance can increase economic freedom. Pensions for the elderly encourage less productive workers with higher health and disability costs to retire and allow younger, more energetic, healthier workers to enter the laborforce. UHC prevents joblock (which is a huge problem in the US). Unemployment insurance can prevent people from working at jobs far far below their talent and productivity levels while also preventing the kind of spending collapse (where everyone starts hoarding money) that helped collapse the economy.

If it weren’t for social security, imagine how many people would be working in their 70s, which would prevent people in their 20s from being able to take over those jobs. Social security was actually started in part with that in mind, to allow people to retire which would increase the productivity of the labor force and lower unemployment.
There are no truly good arguments against UHC from a business perspective IMO. The only ones are based on ideological opposition to government intervention in people’s lives. Every country with UHC spends 50% less than we do, is free of job lock, and many are able to spread health care costs more evenly across society (rather than dumping huge amounts on employers and workers).

If we could have a system like Canada, Germany, France, etc where we only spend 11% of GDP on health care, and where job lock is not a problem, our economy would be much better off. With the money we save (roughly 1 trillion a year in lower health care costs for the same quality of care) we could fund all public and private expenses of our entire educational system (k-12 & tertiary).

So basically we can have our health care system, or a system like France or Germany with less job lock and a 100% free education system (which we could fund with the savings).

14

It’s the heritage Foundation, come on, they’re the crankiest of the cranky, they’re famous for still defending the notion that tax cuts increase revenues in the face of all the evidence. I would have put my house on the fact that the US would drop a few places in their economic freedom index once Obama took office. If the guy responsible for manufacturing this index every years hadn’t dropped the US a few places this year he would have been David Frumed.

15

focusonzed will be shocked.

16

Well, maybe that electricity can be harnessed and reduce the U.S. dependency on foreign energy.

17

Fear itself, Is this a joke? Did you even read the article or the summary you cited? UHC has nothing to do with it. According to your link the US had one of the greatest one year decrease from 2009 in all the countries ranked.

18

Hong Kong is a joke unless you consider legal cartels combined with an unholy alliance between the government and property developers to be cornerstones of a free economy

19

I did a little analysis on the data. Pulled it into Excel (note it was a quick job, my numbers may be off by one or two).

13th in Business freedom Which is:

Starting a business—procedures (number)
Starting a business—time (days)
Starting a business—cost (% of income per capita)
Starting a business—minimum capital (% of income per capita)
Obtaining a license—procedures (number)
Obtaining a license—time (days)
Obtaining a license—cost (% of income per capita)
Closing a business—time (years)
Closing a business—cost (% of estate)
Closing a business—recovery rate (cents on the dollar)

So it costs some to open a business here. Less than most but not the best.

38th in Trade freedom which is:
Trade freedom is a composite measure of the absence of tariff and non-tariff barriers that affect imports and exports of goods and services. The trade freedom score is based on two inputs:

The trade-weighted average tariff rate and

Non-tariff barriers (NTBs).

So we charge a bit more for other countries to do business here.
**138th in Fiscal Freedom which is: **

The top tax rate on individual income,
The top tax rate on corporate income, and
Total tax revenue as a percentage of GDP.

We have a large % of tax revenue compared to GDP.

129th in Government spending which is:
This component considers the level of government expenditures as a percentage of GDP. Government expenditures, including consumption and transfers, account for the entire score.

We spend a lot compared to GDP. (Note, some of these are a little skewed because a some countries are not ranked in every category)
**30th in Monetary Freedom which is: **

Monetary freedom combines a measure of price stability with an assessment of price controls. Both inflation and price controls distort market activity. Price stability without microeconomic intervention is the ideal state for the free market.

The score for the monetary freedom factor is based on two factors:
The weighted average inflation rate for the most recent three years and
Price controls.

Not too bad. Worse than I expected though.

32nd in Investment Freedom which is:
In an economically free country, there would be no constraints on the flow of investment capital. Individuals and firms would be allowed to move their resources into and out of specific activities both internally and across the country’s borders without restriction. Such an ideal country would receive a score of 100 on the investment freedom component of the Index of Economic Freedom.

I imagine our score on this one will go down.

26th in Financial Freedom which is:

Financial freedom is a measure of banking security as well as a measure of independence from government control. State ownership of banks and other financial institutions such as insurers and capital markets reduces competition and generally lowers the level of available services.

20th in Property Freedom which is:

The property rights component is an assessment of the ability of individuals to accumulate private property, secured by clear laws that are fully enforced by the state. It measures the degree to which a country’s laws protect private property rights and the degree to which its government enforces those laws.

18th in Freedom from Corruption which is:

Corruption erodes economic freedom by introducing insecurity and uncertainty into economic relationships. The score for this component is derived primarily from Transparency International’s Corruption Perceptions Index (CPI) for 2008, which measures the level of corruption in 180 countries.

4th in Labor Freedom which is:

The labor freedom component is a quantitative measure that looks into various aspects of the legal and regulatory framework of a country’s labor market. It provides cross-country data on regulations concerning minimum wages; laws inhibiting layoffs; severance requirements; and measurable regulatory burdens on hiring, hours, and so on.

Care to guess which numbers bring down our average the most? And do you think that providing UHC is going to raise those numbers? I don’t. Our numbers are way low on the Fiscal and Governmental aspects of this index. Adding more bills to the pile and raising taxes certainly isn’t going to raise those numbers.

I don’t think this study says what you think it does.

Slee

20

I’m sure that if the Heritage Foundation’s index of economic freedom is useless when it comes determining country’s economic performance, you will have no problem in spending five minutes in Excel and showing us the negative correlation you found between this index and country’s GDP/capita or positive correlation with inflation and unemployment?

Or is your whole post just based on your opinions that are completely unsupported by data and things like business freedom and financial freedom as defined by them might actually good for country’s economy and worth investigating?