JD Foster – Jeffrey C. Goldfarb's Deliberately Considered http://www.deliberatelyconsidered.com Informed reflection on the events of the day Sat, 14 Aug 2021 16:22:30 +0000 en-US hourly 1 https://wordpress.org/?v=4.4.23 Does Freedom Trickle Down? http://www.deliberatelyconsidered.com/2011/09/does-freedom-trickle-down/ http://www.deliberatelyconsidered.com/2011/09/does-freedom-trickle-down/#comments Fri, 02 Sep 2011 17:18:42 +0000 http://www.deliberatelyconsidered.com/?p=7506

Freedom is an integral part of American consciousness and national identity. Thus, legislation and policy proposals are often debated in terms of their ramifications for freedom. Yet, most Conservatives believe this ideal is their private property and pertains only to private property. They hold a narrow view, which privileges the business class. Freedom for the rest of society will magically flourish so long as corporations have their way. This particular approach to freedom, economic freedom, has been brought up repeatedly by Republican Presidential candidate Mitt Romney, who has warned that economic freedom in the United States is in danger of disappearing. This claim has twice earned Romney a “Pants on Fire” rating from Politifact.com. Of course, this will not deter Romney or other Republican candidates from extoling the virtues of economic freedom, warning us of its impending extinction and the tyranny which will ensue. Because the conservative’s “freedom” has been so politically consequential in recent years, it deserves close scrutiny,

According to the ascendant conservative ideology, the size of a government stands in inverse proportion to the liberties of its people. Hence, more government means less “freedom.” The corollary to this maxim is that the lifeblood of the government is tax revenue. Hence, if you want to limit the size of government, you must keep taxes as low as possible. Add the claim, following Cold War logic, that restrictions on economic freedom lead to a decline in general freedom, and you have “freedom,” which will then somehow trickle down on the rest of us. The case for economic freedom has its appeal. Yet, the implicit claim that economic freedom necessarily leads to other freedoms, political or otherwise, does not stand up to scrutiny, as revealed by two recent reports on freedom: Freedom House’s “Freedom in the World 2011” and the Heritage Foundation’s “2011 Index of Economic Freedom.”

A comparison of the two lists is quite instructive as it undermines claims that economic freedom is the basis of other freedoms, that socialist programs . . .

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Freedom is an integral part of American consciousness and national identity. Thus, legislation and policy proposals are often debated in terms of their ramifications for freedom. Yet, most Conservatives believe this ideal is their private property and pertains only to private property. They hold a narrow view, which privileges the business class. Freedom for the rest of society will magically flourish so long as corporations have their way. This particular approach to freedom, economic freedom, has been brought up repeatedly by Republican Presidential candidate Mitt Romney, who has warned that economic freedom in the United States is in danger of disappearing. This claim has twice earned Romney a “Pants on Fire” rating from Politifact.com.  Of course, this will not deter Romney or other Republican candidates from extoling the virtues of economic freedom, warning us of its impending extinction and the tyranny which will ensue. Because the conservative’s “freedom” has been so politically consequential in recent years, it deserves close scrutiny,

According to the ascendant conservative ideology, the size of a government stands in inverse proportion to the liberties of its people. Hence, more government means less “freedom.” The corollary to this maxim is that the lifeblood of the government is tax revenue. Hence, if you want to limit the size of government, you must keep taxes as low as possible. Add the claim, following Cold War logic, that restrictions on economic freedom lead to a decline in general freedom, and you have “freedom,” which will then somehow trickle down on the rest of us. The case for economic freedom has its appeal. Yet, the implicit claim that economic freedom necessarily leads to other freedoms, political or otherwise, does not stand up to scrutiny, as revealed by two recent reports on freedom: Freedom House’s “Freedom in the World 2011” and the Heritage Foundation’s “2011 Index of Economic Freedom.”

A comparison of the two lists is quite instructive as it undermines claims that economic freedom is the basis of other freedoms, that socialist programs such as universal health care can only lead to tyranny, and that taxes and the size of government (as measured by government spending) necessarily erode economic freedom.

For example, Canada, with its socialist health care system, ranks sixth on Heritage Foundation’s index, coming ahead of the United States, which ranks ninth. Denmark, a highly egalitarian social democracy with a sizable welfare state, is also ranked ahead of the United States in economic freedom, while being listed as “free” by Freedom House. Singapore, a country with a quasi-authoritarian government, is ranked number two in economic freedom, while only being “partly free,” according to Freedom House. And coming just behind the United States at number ten on Heritage Foundation’s index is Bahrain, listed as “not free” (and getting worse) by Freedom House.

In fact, the two NGOs report opposite trends. The Heritage Foundation claims that, “…the majority of countries are once again on a positive path to greater freedom,” while according to Freedom House, “…conditions [for global political rights and civil liberties] worsened for the fifth consecutive year in 2010.” (In a separate report, Freedom House also claimed that “the rights of workers are in jeopardy in much of the world.”) Thus, the correlation between economic freedom and other freedoms is not absolute, and under some conditions, appears to be inversely related.

The claim that low taxes and less government necessarily means more freedom is even flimsier. The notion, nonetheless, provides grist for conservative NGOs such as Freedom Works, which has the motto “Lower taxes, Less Government, More Freedom,” and Americans for Tax Reform,  which claims that “The government’s power to control one’s life derives from its power to tax.” Yet, if we look again at the Heritage Foundation’s index, and zoom in on some of the individual measures which their index is comprised of, we find that several countries which rank higher than the United States in economic freedom actually have both higher tax burdens (as % of GDP) and more government spending (as % of GDP) than the United States. For example, Australia, which ranks third in overall economic freedom, has percentages of 32.2 and 39.7, respectively, to the United States’ 26.9% and 38.9%. Denmark, New Zealand and Canada also exhibit this trend.

In fact, many countries with less economic freedom, and overall freedom, have lower tax rates and lower government spending compared to “free” countries. For example, Iran has a 6.1% tax burden as a percentage of its GDP and its government spending is 28.3% of its GDP, while being ranked as 171st in economic freedom. China, ranked 135st, also has a lower tax burden (26.9%) and lower government spending (38.9%) than the United States. This low ranking, however, did not stop JD Foster, a researcher at the Heritage Foundation, from claiming that the US has much to learn from China about “the power of freedom.”

So the power of a government is not simply proportional to its size, as measured by government spending at least. Yet, following Freedom Works’ logic both Iran and China are “freer” than the United States. Even “freer” still would be Burma, with a government so small (government spending is 8% of its GDP) you might be able to “drown it in the bathtub,” as Grover Norquist would like it, military junta and all.

Conservative claims aside, the United States enjoys a sizeable amount of economic freedom when compared with the rest of the world. Furthermore, taxes and government spending are only two of many factors in determining economic freedom, which itself is but one factor in general freedom, not its primary cause. And according to the Heritage Foundation, “an efficient regulatory framework,” which is “straight-forward” and “transparent,” and “strong anti-corruption laws” which are “well-enforced” (thus preventing the spread of crony capitalism) can actually enhance economic freedom.

The rule of law is indeed an important factor of economic freedom, and of course, freedom in general. Where rule of law is weak and not evenly applied to all, as it tends to be in heavily authoritarian countries, both economic and political freedom will suffer as powerful individuals and corporations  refuse to play by the rules. Thomas Jefferson recognized this potential outcome when he wrote, “I hope we shall crush in its birth the aristocracy of our monied corporations which dare already to challenge our government to a trial by strength, and bid defiance to the laws of our country.”

For too long, the rhetoric of freedom has been dominated by conservatives who emphasize trickle-down “freedom,” directing debate away from dangers to freedom posed by the concentration of wealth and power that is currently happening in the United States. Now is the time for a deliberate debate about freedom beyond conservative ideology.

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