Posts Tagged ‘governmental corruption’

The Heritage Foundation's 2012 Index of Economic Freedom, which tracks the economic viability and institutional corruption of over 170 countries, shows that the United States has fallen out of the list of free economies for the first time. Analysts warn this could herald a bleak economic future for the United States unless the trend is reversed.

The Heritage Foundation’s latest edition of its Index of Economic Freedom shows a bleak trend of declining personal economic freedom amid growing governmental corruption.

The United States’ economic freedom score of 76.3 drops it to 10th place in the 2012 Index. Its score is 1.5 points lower than last year, reflecting deteriorating scores for government spending, freedom from corruption, and investment freedom. The U.S. is ranked 2nd out of three countries in the North America region, and its overall score remains well above the world and regional averages.

Declining economic freedom inevitably has a negative impact on the nation’s economic competitiveness and the standard of living.

John Berlau, director of the Competitive Enterprise Institute’s Center for Investors and Entrepreneurs sees a similar trend:

“We’ve already seen since the onerous Sarbanes-Oxley accounting mandates signed by Bush in 2002, a huge dropoff in foreign companies listing on our stock exchanges. Instead these firms are listing in the stock markets of Hong Kong, London, and other Sarbox-free zones. With Obama’s garganutuan mandates, such as the Dodd-Frank sham financial “reform,” American entrepreneurs may have to go overseas for venture capital and angel investors.”

By contrast, Hong Kong, which leads the Heritage Foundation’s Index, has remained largely stable throughout the recent global economic turmoil, which Heritage economists attribute to Hong Kong’s open regulatory climate and zero tolerance for corruption.

“Thanks to the crushing burden of massive overregulation and spending, we are already in a lost decade. But if we start steering the ship of state toward freedom, we can still make a course correction before the decade’s end,” Berlau says.

And a recent Congressional Budget Office report warns that the current budget track of governmental spending and growth could seriously impact the nation’s long-term economic viability.