By Robert Sanchez, JMI Policy Director
In “Big Yellow Taxi,” folksinger Joni Mitchell lamented public indifference toward shrinkage of the natural environment. Her famous lyrics, “Don’t it always seem to go that you don’t know what you’ve got ‘til it’s gone; they paved paradise and put up a parking lot,” still resonate.Now the same kind of lament could apply to a troubling trend toward less freedom in America’s economy, as reflected in a new report from the Heritage Foundation and The Wall Street Journal.Heritage’s announcement summarizes the bad news: “For the second year in a row, America’s economy has grown less free, according to a new analysis from The Heritage Foundation. The 2011 Index of Economic Freedom finds that America’s economy is now the ninth-freest, behind countries such as Australia, Canada, and Denmark.”Why the decline? The authors explain: “The government’s recent spending spree has led to fragile business confidence and crushing public debt. Interventionist responses to the economic slowdown have eroded economic freedom and long-term competitiveness. Drastic legislative changes in health care and financial regulations have retarded job creation and injected substantial uncertainty into business investment planning.”This is but one of several different indices of economic freedom. Comparing the economic freedom in different countries is especially useful at a time when economists increasingly speak of “a global economy” – and also useful as a warning of danger ahead when the various indices all conclude that the U.S. economy is becoming less free. Incidentally, the idea for a free-market oriented index of economic freedom is widely credited to the late Milton Friedman and was carried out by pioneering Florida State University economist James Gwartney, a member of JMI’s Research Advisory Council. Dr. Gwartney, working with economist Robert Lawson and others, also devised a classic definition of economic freedom:“Individuals have economic freedom when property they acquire without the use of force, fraud, or theft is protected from physical invasions by others, and they are free to use, exchange, or give their property as long as their actions do not violate the identical rights of others. An index of economic freedom should measure the extent to which rightly acquired property is protected, and individuals are engaged in voluntary transactions.”The Gwartney/Lawson report, Economic Freedom of the World, “uses 42 distinct pieces of data to measure economic freedom in 141 nations.” In it, as well as in the just-released Heritage/Wall Street Journal report, the United States is losing ground. That ought to worry Americans because, to paraphrase Joni Mitchell, “You don’t always miss the freedom you’ve got ‘til it’s gone.”
2011
