EDITORIAL: The dramatic link between freedom and prosperity
If you want to increase a country’s wealth and life expectancy, while decreasing its infant mortality and poverty rates, make its people freer.
Those are some of the findings in the 2019 Economic Freedom of the World Report from the Fraser Institute, a Canadian think tank. It annually compares the level of freedom in countries across the globe in categories such as size of government, property rights and access to international trade. The United States ranked fifth, up from 16th in 2016. The freest countries in the world are Hong Kong, Singapore, New Zealand and Switzerland. The least-free countries are Sudan, Libya and, in last place, Venezuela.
The report divides the 162 countries it examined into quarters. This provides overwhelming evidence that freedom makes people wealthy and healthy. Countries in the top quartile of economic freedom have an average GDP of $36,800 per capita. In the bottom quartile, the average GDP is $6,100. That’s a six-fold difference.
In the most-free countries, the average income of the poorest 10 percent is $10,600. That’s 73 percent higher than the average GDP, which is roughly equivalent to income, in the poorest countries. In the most-free countries, the moderate poverty rate, those living on $3.20 a day or less, is 5 percent. In the least-free countries, it’s 43 percent.
Even with less money to go around, countries with fewer economic freedoms don’t have less income inequality. In those countries, the poorest 10 percent have 2.53 percent of a country’s income. In the most-free countries, it’s 2.75 percent of income.
People living in free countries live longer, too. In the most-free countries, the average life expectancy is almost 80. In the least free countries, it’s 65. The infant mortality rate is 6.7 per 1,000 in the top quartile of free countries. In the bottom quartile, it’s 40.5 per 1,000.
Economic freedom is also associated with greater political rights and civil liberties. There’s also a correlation between economic freedom and happiness, as measured by the U.N. World Happiness Index.
These findings should give pause to those intrigued by the collectivist plans of Democratic presidential candidates. The best way to improve people’s lives is to get government out of the way to the greatest extent possible. There’s also a lesson here for President Donald Trump. It’s counterproductive to use tariffs to restrict international trade — unless it involves national security.
The evidence couldn’t be more overwhelming. Democracy and individual freedoms create the conditions that produce prosperity.