U.S. Drops to 18th in Economic Freedom
posted at 10:17 pm on September 19, 2012 by Matt Vespa
If you’re a Canadian, you should be happy. Our friendly neighbors to the north are riding high with their recent placement on the Economic Freedom chart at number five. Meanwhile, the United States dropped ten spots to number eighteen on the scale. Gateway Pundit posted about this story today citing The National Post which reported that:
The annual Economic Freedom of the World report, released Tuesday, has Canada tied in fifth place with Australia — up one spot from last year. Hong Kong remains at the top, Singapore’s next, then New Zealand.
Meanwhile, the United States, once a ‘standard bearer’ of economic liberty among industrial nations, spiralled 10 spots from the 2011 rankings to 18th place — its lowest position ever, and a huge drop from its second place spot in 2000.
Liberals will continue to say it’s all Bush’s fault. However, did Bush add $5 trillion to the national debt in less than four years? Furthermore, given that we have a new multi-trillion dollar health care entitlement – whose true cost periodically changes with the CBO– I’m sure that uncertainty levied upon small business owners had ‘no impact’ on the various indicators that calculate economic freedom (I’m kidding) Furthermore, The Economist published a column last February, which highlighted our over-regulated business apparatus, now looks prophetic.
Consider the Dodd-Frank law of 2010. Its aim was noble: to prevent another financial crisis. Its strategy was sensible, too: improve transparency, stop banks from taking excessive risks, prevent abusive financial practices and end “too big to fail” by authorising regulators to seize any big, tottering financial firm and wind it down. This newspaper supported these goals at the time, and we still do. But Dodd-Frank is far too complex, and becoming more so. At 848 pages, it is 23 times longer than Glass-Steagall, the reform that followed the Wall Street crash of 1929. Worse, every other page demands that regulators fill in further detail. Some of these clarifications are hundreds of pages long. Just one bit, the “Volcker rule”, which aims to curb risky proprietary trading by banks, includes 383 questions that break down into 1,420 subquestions.
Hardly anyone has actually read Dodd-Frank, besides the Chinese government and our correspondent in New York (see article). Those who have struggle to make sense of it, not least because so much detail has yet to be filled in: of the 400 rules it mandates, only 93 have been finalised. So financial firms in America must prepare to comply with a law that is partly unintelligible and partly unknowable.
Oh yes, a classic example of government trying to do too much, too fast leading to the inevitable confusion that big government policies exude. Just look at education policy in this country. Now,we’ve got a titanic battle with the blob on our hands. Then, there is health care where all fifty state legislatures have passed, cumulatively, almost 1900 mandates on benefits coverage – which has only increased costs in the succeeding years. Yes, it’s a state issue – but given that Obamacare acts like one of these mandates on steroids – suffice to say it will yield the same results seen in all 57 50 states. Lastly, “every hour spent treating a patient in America creates at least 30 minutes of paperwork, and often a whole hour. Next year the number of federally mandated categories of illness and injury for which hospitals may claim reimbursement will rise from 18,000 to 140,000. There are nine codes relating to injuries caused by parrots, and three relating to burns from flaming water-skis.” The leviathan is waiting.
Over the past three years, the bound edition of the Code of Federal Regulations has increased by 11,327 pages – a 7.4 percent increase from Jan. 1, 2009 to Dec. 31, 2011. In 2009, the increase in the number of pages was the most over the last decade – 3.4 percent or 5,359 pages.
Over the past decade, the federal government has issued almost 38,000 new final rules, according to the draft of the 2011 annual report to Congress on federal regulations by the Office of Management and Budget. That brought the total at the end of 2011 to 169,301 pages.
That is more than double the number of pages needed to publish the regulations back in 1975 when the bound edition consisted of 71,244 pages.
Leaving out that fact that Obama added $9.5 billion in red tape last July – Star reported that “Seventy percent of the regulations were economic, accounting for $1.236 trillion of the annual cost. The other regulations were, in order of cost, environment regulations ($281 billion), tax compliance ($160 billion) and occupational safety and health and homeland security ($75 billion).” Then, there is EPA administrator Lisa Jackson – who said the agency wasn’t responsible for killing jobs. Although, in 2008, President Obama did officially launched the “war on coal” and promised to squash any new plants under his tenure. That sounds like killing jobs to me.
As Investors Business Daily reported last September:
…Texas energy company Luminant announced that new Environmental Protection Agency regulations were forcing it to close several facilities, resulting in the loss of 500 jobs and 1,200 megawatts of generating capacity.
The company cited the cross-state air-pollution rule in its decision to cease operations at two electricity-generating facilities and three coal mines. Texas utilities have been ordered by the EPA to cut sulfur dioxide emissions by 47% from 2010 levels and nitrogen oxide by 8% and to do it by January. The head of the Texas Public Utility Commission says the rules could lead to rolling blackouts.
The rule affects more than Texas. It requires coal companies in 27 states to slash emissions of sulfur dioxide and nitrogen dioxide by 73% and 54% from 2005 levels by 2014. ‘Just because wind and weather will carry air pollution away from its source at a local power plant doesn’t mean that pollution is no longer that plant’s responsibility,’ said EPA administrator Lisa Jackson.
Steven Miller, CEO of the American Coalition for Clean Coal Electricity, warns of job losses totaling 1.4 million over the next eight years and a 23% jump in electricity rates in states dependent on coal-fired plants. Well, Obama did promise he would make energy prices ‘necessarily skyrocket.’
500 jobs were lost – is that a lot? Sadly, more lay offs are on the way, unless you’re a union worker.
Finally, there is the national debt and our exploding and unsustainable welfare state, which correlates with the size and scope of government. As reported by MyGovCost.org back in February, “President Obama has permanently grown the size of the U.S. federal government’s budget by 16.5% during the four years he will have been in office by the end of his first term in office. The federal government’s spending is one-sixth bigger today than it was projected to be at this point four years ago.”
So, that certainly debunks what Austan Goolsbee, Obama’s former Chairman of the Council of Economic Advisors, said on This Week last January on why the economy had stagnated. Yes, he actually said economic growth was impeded due to the rapid shrinkage of government.
Given all of these aspects of the Obama economic psyche, no wonder why we have a significant amount of our economic freedom. Granted, there are probably many more issues that have lead to this epic fall, but it should get conservatives more enthused and more fired up to deny Barack Obama a second term. While I’m not going to use the phrase the “most important election of our lifetime” – which I think should be retired forever – we certainly cannot afford another four years of the Obama administration.
In the meantime, we should be thanking the Fraser Institute for not incorporating government incompetence into their methodology for the Economic Freedom of the World Report. I can only imagine where we would fall under this administration.