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Freedom at risk; U.S. slips to rank of `mostly free'.

COLUMN: In our opinion

The 2010 Index of Economic Freedom, the annual collaboration between the Heritage Foundation and the Wall Street Journal, contains a sobering message this year: The United States, long classified in the elite group of economically "free" nations and states, has slipped into the ranking of "mostly free." The U.S. continues to enjoy a strong position - ranked as the 8th freest economy in the world - but lost 2.7 rating points because of its handling of the economic downturn.

The authors conclude that government attacks on free-market principles, combined with "quick interventionist remedies" and massive government spending, brought an overall decline in the index of one-tenth of a point, to 59.4 - only the second time the index has seen an overall decline in two successive years.

The more important conclusion is that increases in government spending correlated with declines in gross domestic product. As the 2010 report shows, governments that increased expenditures between 5 percent and 30 percent saw declines in gross domestic product ranging between 2 percent and 9 percent, with an average loss in GDP of around 4 percent. "The early evidence is that such spending has not worked," the report concludes.

That will not come as surprising news to Americans who are unemployed, or those who, while retaining their jobs, watch with a mixture of disgust and amusement as financial fat cats receive government bailouts, billions and trillions in new debt are added, and spending on "shovel ready" jobs becomes mired in red tape and falls so very short of creating the millions of jobs the administration promised.

Still, the annual index is offered in hope. A central tenet holds that increased economic liberty - as measured in areas such as restrained government spending, freedom of trade, strong property rights, monetary freedom, and freedom from corruption - is invariably reflected in higher per-capita incomes and greater prosperity for a nation's people. The United States rightly remains among the world's leaders by most measures. It remains one of the greatest responsibilities of her citizens to use the power of the press, voting box and their wallets to defend the liberties we still enjoy.
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Title Annotation:EDITORIAL
Publication:Telegram & Gazette (Worcester, MA)
Article Type:Editorial
Date:Jan 23, 2010
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