A new report prepared by the Cato Institute and the Fraser Institute reviews economic freedom around the globe. According to Economic Freedom of the World: 2014 Annual Report, the Unites States no longer ranks in the top 10 internationally. According to Cato’s Ian Vásquez:
The United States is the 12th freest economy in the world. …The U.S. ranking is part of a worrisome decline in economic freedom that began more than a decade ago. For decades, the United States ranked in second or third place on the index. In 2000 it was #2, yet by 2005 it ranked 8 and it continued its precipitous fall until recently. On a 0-10 scale, the U.S. rating is now 7.81 compared to 7.74 last year, a slight improvement. The level of economic freedom in the United States is lower today than it was in 1980. Since 2005, Canada has ranked higher than the United States.
The report ranks countries according to five factors: the size of government; legal system and property rights; sound money; freedom to trade; and regulation. While the Unites States has slipped across-the-board, Vásquez notes that we’ve really declined in terms of the rule of law, which:
… is a result of “increased use of eminent domain to transfer property to powerful political interests, the ramifications of the wars on terrorism and drugs,” and other property rights violations. Because the rule of law is of course a cornerstone not just of economic freedom but of all freedoms, and because there is a strong relationship between economic freedom and other liberties (civil and political), all Americans should be concerned with the findings of the report.
The countries that rank ahead of the United States are (see p. 8):
1. Hong Kong
3. New Zealand
6. United Arab Emirates
10. Chile & Finland (tied)