The World’s Economic Freedom Stats for 2012 – America’s slide continues

George Rebane

On our way to a socialist state we are leaving stark signposts of economic decline.  Among the most important is our relative ratings and rankings over the years.  Such data explain away why jobs are leaving these shores, and why they will not come back.

In the meanwhile, we are proud to announce that on 1 January 2012 the country added over 40,000 new laws and regulations to further corral our liberties, and our government’s spending now amounts to about 40% of GDP.  The Left has plans to drive this wealth killing percentage even higher as the economy declines.  A summary of the Economic Freedom Index is found in the 12jan12 WSJ (source of filched table above), and an excellent interactive report on the rankings and ratings is available on the Heritage website here.  WSJ and the Heritage Foundation generate this index annually.

Attending yesterday’s Nevada County Tea Party Patriots luncheon and talk by Rep Tom McClintock (see NC2012 report here), we heard another stirring report of how some in the country are trying to get things back on the right track (pun intended).  But we’ve been hearing these huuraahs now for some years (decades?).  I would like to see a metric established by some conservative organization that tracks how many laws and regs got sunsetted during the last year, and how our Liberty Index has started climbing back up again.  The rest of the podium bull pucky really doesn’t matter.  For without knowing what's really happening, it just bandaids our growing misery.  Let’s see if we can work on a new concept of what is a ‘productive legislature’ – and it ain’t one that every year papers the walls with more rules about things we can’t and must do.

Comments

[Douglas Keachie]

We are still well within the top 10%, ahead of almost all of Europe, and by far the largest country represented in the top 10%

[Douglas Keachie]

A great many countries further down the scale would not have allowed the grand exodus of manufacturing abroad that our free society did, and the results are not in yet. Historians may view the Great Leap Forward of China over the last ten years as being the result of the Great Shove Forward, the last major act of the USA before it hit the dustbin of history.

[Brad Croul]

We can only hope that all new elected officials will work to make government less intrusive and burdensome. But, I fear elected mostly do it for the money, power, and influence they might accrue.

[billy T]

"The budget should be balanced, the Treasury should be refilled, public
debt should be reduced, the arrogance of officialdom should be tempered
and controlled, and the assistance to foreign lands should be curtailed
lest Rome become bankrupt." Cicero , 55 BC

[Paul Emery]

Let's look at the champ at the top of the list. From my brief research I found that in Hong Cong the bottom 60% of earners pay no income tax at all. The top 100,000 taxpayers pay 57% of all taxes. Also Hong Kong has a system of government-operated hospitals, which constitutes the majority of the health care system. People also have the option of a private hospital if they wish. There are more than fifty public hospitals, and twelve private ones.

Gee George, is this a direction we should be heading to improve on the Economic Freedom Index?

[Paul Emery]

In fact George all countries in the top 20 in the index have national health care programs except of course...... It seems evident that national health care has nothing to do with the Economic Freedom ratings and, in fact, seems to enhance it.

[billy T]

Paul, Hong Kong is a great place. No capital gains taxes. Zero, nada, zilch. Zero is a nice round number. Milton Freeman went bonkers over Hong Kong as it influenced all his writings on how to make an economy flourish. Its why the likes of little ole me have accounts in Hong Kong and a new one Shanghai. Forget Europe, forget Japan. Every time the USA has lowered capital gains rates our tax revenues to the Treasury has increased. Proven over and over again. No argument. Want to get things going? Do what Hong Kong does. When a candidate for his party's nomination for President was confronted with these facts directly in the primary debates, the candidate answered that those who received a cut in capital gains taxes were not paying their fair share. It was not about growing the economy or increasing revenues to the US Treasury. To the misguided candidate the only thing that mattered was perceived "fairness", not results, not what is for good for the nation. I will be horned diddled if that walking talking encyclopedia of worthless information did not end up President of The United States in 2009.

[Paul Emery]

Whatever. My point was that all top 20's on the list have national health care of some form making the question as to it's viability in a free economy a moot point.

Billy, for my education did Bush 2 lower capital gains taxes and if so did the Treasure increase? When was the last time they were lowered?

[Paul Emery]

All except us of course (health care) I don't consider Obama's plan a national health care system.

[George Rebane]

PaulE 1042am - actually it is not a "moot point" as long as you consider adding their various types of national healthcare along with the other attributes that their socio-political system delivers/imposes. Perhaps nationalized healthcare can be delivered with cost/benefits like our interstate road system, but we haven't seen that design yet. What we have seen is disasters like Amtrak, USPS, EPA, FDA, Federal Reserve, Fannie, Freddie, FAA,..., and our K-12 public schools. Committing to a nationalized healthcare before allowing the marketplace to operate (remove insurance oligopolies, medical tort lotteries, ...) is premature. The government is competent in precious few enterprises and activities; most certainly something like healthcare is not one of them.

[Douglas Keachie]

So, in the opinion of George Rebane, doctoring is more complicated than rocket science (NASA)? Greg, pay attention here.

[George Rebane]

Yes indeed, delivering good national healthcare is way more complicated than delivering good national rocket science.

[Douglas Keachie]

Good, let us run and find a great systems engineer to design the best path for us to follow...

[Paul Emery]

George

This is a very complicated and important topic. Thanks for indulging in it. What seems to be illustrated is that all countries that rate well in the Economic Freedom Stats have all implemented an effective form of universal health care with the exception of the US. It is my contention that the influence of special interest money in the legislative process makes this all but impossible (1 billion a year).

I also believe that the Republican plan of tort reform and national access for health insurance accross state borders will bow to the same money masters that control the agenda now and essentially they will be unable to effect reform because of the same obstacles.

Leaving it up to the "free market" to solve is a complete fantasy because why would those in control of the system willingly give up their government supervised monopoly? Do you honestly think the Republicans would be independent of the money that controls the agenda right now?

Looking beyond that scenario, universal national health care is certainly an established norm in all modern countries except, of course for......

And yes, I agree that health care is more complicated than launching rocket ships. But is it more complex than national defense?

[George Rebane]

PaulE 630pm - I do believe that national health care is more complex than national defense. And your ongoing dunning of the free market doesn't seem to include the realization that when government steps back and no longer "supervises monopolies", reality sets in very quickly. Capitalists have to deliver product for a competitive price that is ALWAYS lower than any state managed price. When the healthcare markets are opened up, participants don't have a choice in retaining their current fantasies of government supported this or that. They have to answer to customers who have choices on where to spend their healthcare dollars.

But I don't think we have said anything new here other than reinforced the notion that keep government out of the complex affairs of its citizens - from a systems purview, the input/response relations (or transfer functions) of such complex systems are not known. And without knowing the transfer function, it is IMPOSSIBLE to exert any rational centralized control over a system (recall chimpanzees in a 747 cockpit at 30K ft). Nature and nature-based free markets solve such problems through distributed knowledge and distributed adaptive control.

[Paul Emery]

George

But George how do you explain the well managed health care systems that are doing quite well in countries that surpass us in the EF charts you cite? Is it not worth considering some form of emulation for this country since they seem to have a positive effect on Economic Freedom as charted by the Heritage website?

We are currently in this dilemma. Our health care system is the most expensive in the world as far as the percentage of the GDP is concerned. Let's consider these questions. First is this acceptable, second is Obama care an significant improvement and third is there a Republican alternative that could realistically provide universal health care. That raises another question. In your opinion is universal health care important?

My answers are 1-No, 2-No, 3-No and yes universal health care is important.

[George Rebane]

PaulE 803pm - I know of none of them as being "well managed health care systems", and none of them are "doing quite well" as we see country after country going into debt beyond their ability to pay. If well managed means parceling out (rationing) health service to delay the inevitable bankruptcy as long as possible, then you may have a case. However, it is not my standard.

And the expense of our healthcare system is entirely due to the malformed way that our government has been involved in and restricted the markets. Giving and incompetent and bloated bureaucracy control of another 16-20% of our economy is definitely not the answer.

[Douglas Keachie]

Healthcare is only part of the picture of the world's economic woes. It is not the cause of them. And morally speaking, do we prefer guns to nurses and doctors? Which should we cut first? Frankly a great deal of overseas military is in support of corporations who appear to have no allegiance to the well being of the average American. Let the Marines come home and work on alternative energy projects here, instead of defending GM over there. To your way of thinking, our troops abroad are propping up their medicare, with expenditures that support their local economies.

The markets wages some of the bloodiest warfare ever, as class warfare personified (see United Citizens and the SCOTUS) and their tools involve using the government as a bully pulpit, via lobbyists. The markets are the farthest things from guardian angels and they sure are not Vestal Virgins.

[George Rebane]

DougK 844am - good summary of the progressive view. I especially like the picture of Marines coming home to work on alternative energy projects. A good second is the notion of preferring guns to nurses, as if that were the way real alternatives presented themselves. Unfortunately, we need a certain amount of guns out there if we are to have enough nurses taking care of us.

But you are right that markets are not vestal virgins, and totally wrong that they are "the farthest things from guardian angels". Properly regulated markets are the closest things to guardian angels that the secular humanist will ever see, for they are the foundation on which capitalism and free enterprise thrive.

[Paul Emery]

George

It was very clear what I was referring to were the countries that you noted were ahead of us in the Economic Freedom Stats all of which had national health care systems. These include Hong Cong, Australia, New Zealand and so on. Are you saying that these countries are not doing well and headed for "inevitable bankruptcy"

Do you think the Republican have the independence from special interests and will to enact meaningful reform?

Of course universal health care would be rationed. How could it be otherwise.

One final question. Is there any country in the world that has a health care system anywhere near what you envision for this country?

[George Rebane]

PaulE 958am - no question about your clarity. Yes, your cited countries are not doing well in the sense that even they have not discovered a sustainable national healthcare system (NHS), because each of their NHSs are growing in terms of their GDP (i.e. they cannot grow their GDPs fast enough to stabilize their NHSs). As we all agree, the alternative is to reduce services through some means of rationing (i.e. here come the notorious 'death committees').

(Please restate your 'Republican independence' question.)

Your "final question" must by now be taking its umpteenth curtain call in these pages. The answer is still NO. Of the NHSs with which I am familiar, I believe the US can do much better by going down the road of free enterprise to a properly regulated 'free market', and the journey starts with elimination of state mandated insurance monopolies and oligopolies along with the revision of medical tort laws and the FDA's drug approval protocols to reflect technology advances in the last fifty years.

The progressives' zeal to add demonstrably unsustainable bureaucratic bandaids to already unworkable patchworks of governmental intervention prevents the search for more workable solutions, and makes our little local discussions turn in ever tighter circles. Recall my futile attempt some months ago to put this discussion on a reasonable path.
http://rebaneruminations.typepad.com/rebanes_ruminations/2011/01/healthcare-utility-metric-with-scriptural-underpinnings.html

[Paul Emery]

Do you believe the Republicans have the will and independence from special interest money and influence to allow health care reform. We are left three scenarios. Obamacare, things as they are, or a Republican alternative. My personal preference, single payer national health care for all with optional private enhancements is not being championed by either party which means it's probably the one special interests want least.

[George Rebane]

PaulE 1059am - thanks Paul. Other than still not knowing the full ramifications of Obamacare - new discoveries emerge every day - your three alternatives are useful. Given the history of how we got to Obamacare, the debate since then, Republican promises made, ..., I do believe that they have more of a motivation to implement the path I outlined in my 1040am. Will they be squeaky clean of special interest lobbies? NO. But going with Repubs on this would be head and shoulders above continuing with the Dems hell bent to implement what they cobbled together in the dead of night while wearing blindfolds.

But I also believe that a single payer limited services NHS "with optional private enhancements" would be an improvement, most certainly over Obamacare. And if such an NHS is done right (includes my above outlined provisos), it could well be the first step that zeros in on a world class system and would serve as a template to other countries now going broke.

[Paul Emery]

Are Australia and Hong Cong going broke?