Economic freedom falls dramatically worldwide

The decline has been broad-based and dramatic. 146 of 165 jurisdictions saw their scores fall from 2019 to 2020, the most recent year for which internationally comparable data is available. Some of the reasons for the decline include “massive increases in government spending, fiscal expansion, travel restrictions, [and] Regulatory mandates on business.” And although the report does not take a position on the effectiveness of policy responses to the pandemic, it does show that the decline “wiped out the value of a decade of global average improvement and was more than three times the global decline witnessed in the 2008/09 financial crisis. The coronavirus pandemic has undoubtedly been a disaster for economic freedom.”

The US rating dropped from 5 as its rankingm 2019 to 7 am In 2020.

This is from Ian Vasquez, “Global economic freedom has been sharply reduced in the wake of the pandemic,” Cato at LibertySeptember 8, 2022.

Vasquez discusses the Economic Freedom of the World: 2022 Annual Report, published annually by the Fraser Institute in Vancouver, Canada, and the Cato Institute in Washington, DC.

This project, which has been going on for decades, is one of the most valuable data-mining projects in the economy. It gives us a report card every year, roughly 1.5 years apart, on how economic freedom is faring in most of the world.

Given the robust measures most governments around the world have taken to deal with the pandemic, from massive increases in public spending to travel restrictions, business closures and more, it’s no wonder that economic freedom declined more in one year (2020) than in any other year, according to scholars. Since it started measuring. Of particular interest to me, given my dual citizenship (Canada/US), for several years until recently Canada was economically independent from the US. For example, in 2013 (2015 report), Canada had a rating of 7.89 out of 10 and was ranked 9th in the world, above the United States, which received a rating of 7.73 and was 16th in the world. In 2014 (2016 report), Canada rose to 5th place with a rating of 7.98, while the United States ranked 16th with a rating of 7.75. In 2015 (2017 report), the United States and Canada were ranked 11th at 7.94. In 2016 (2018 report), the United States had a rating of 8.03 with a 6th ranking while Canada was at 7.98 with a 10th ranking.

After that, Canada never caught up to the US, but both ratings and rankings rose in 2017 (2019 report). The United States ranked 5th at 8.19 and Canada ranked 8th at 8.08. It was the top ranking for both. In 2018 (2020 report), the United States dropped to 6th place although its rating rose slightly to 8.22. Canada dropped to 9th place, although its rating rose slightly to 8.17. They deviated further in 2019 (2021 report), with the United States in 6th place with a rating of 8.24 and Canada in 14th place with a rating of 8.06. In 2020 (2022 report), the United States was 7th with a rating of 7.97, while Canada was 14th with a rating of 7.81.

I have more to say as I work through this year’s report and compare it to previous years

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