At its pinnacle in 2000, the United States ranked second in the world for economic freedom. In the latest report on world economic freedom from the Fraser Institute, the U.S. has now dropped all the way down to 18th, falling behind countries like Bahrain, the United Arab Emirates, Estonia, Taiwan and Qatar.
The decline did not happen overnight. “This entire decade we’ve been sliding towards this 18th ranking,” report author Joshua Hall explained to The Daily Caller News Foundation.
By 2005, the United States had already dropped to eighth in economic freedom. In 2009, the U.S. fell behind welfare state countries like Denmark, Finland and Canada.
“When people think of Canada, they think of socialized medicine, but in many facets of life, Canada is a lot more economically free than the United States,” said Hall.
The annual report uses 42 different variables that can be categorized into five distinct categories: size of government, legal system and property rights, sound money, freedom of trade internationally and regulation.
The growth of government and less secure property rights have the most to do with the United States’ drop.
“I think we think of the underlying causes of our decline in legal system and property rights, the Supreme Court’s Kelo decision [over eminent domain], the war on terror, and things related to the rule of law, things like TARP and the bail outs, have all contributed to the decline of scores in areas one and two,” Hall explained.
