April 15, better known as Tax Day, is approaching again. The “Yes, We Can” Administration, which has squandered billions of hard-working Americans’ tax dollars every year on wasteful programs, has deprived economic freedom at an accelerating rate.
The collateral damage from America’s dwindling economic freedom can only get costlier over time, and there is a real risk that the economic sclerosis we are currently suffering could turn into a full-blown permanent economic health crisis. In his March 31 column, Robert Samuelson of The Washington Post compared the current state of America’s economy to a patient who’s recovering from a serious illness:
At first, everyone hopes the patient will return to normal. Then it’s gradually realized that the patient suffered permanent damage and will never be the same. So, perhaps, with the economy. Since the Great Recession, the bland (often unstated) premise has been that the economy would ultimately recover in full. Now, some economists question this and argue that the economic crisis created—or exposed—enduring weaknesses.
Contributing to those “enduring weaknesses” is the alarming decline of economic freedom in this country. As documented in the 2014 Index of Economic Freedom, a data-driven economic policy analysis by The Heritage Foundation and The Wall Street Journal, America is the only country that has recorded losses of economic freedom in each of the past seven years.
Our entrepreneurial dynamism and innovative capacity have been slowly but surely undermined, not least by the following:
- Excessive regulation. The overall cost of meeting regulatory requirements has increased by over $70 billion since 2009, with more than 150 new regulations burdening American businesses and individuals. In terms of ease of starting a new business, the U.S. is ranked 20th in the world, trailing countries such as Canada, Georgia, Lithuania, and Malaysia.
- Taxes that rival the highest in the world. By world standards, America’s fiscal freedom—a measure of the tax burden—is among the worst, ranking a dismal 154th out of 178 economies. High tax rates and a tax code that is burdensome for both individuals and businesses clog America’s economic arteries, hindering vibrant entrepreneurial growth. Last year, Congress and President Obama instituted 13 tax increases, including raising the top federal individual tax rate to 43.4 percent. America has the highest corporate tax rate among industrialized nations and further challenges business competitiveness in the international marketplace by taxing the foreign earnings of its businesses.
As a result, fewer Americans either have or are looking for jobs today than at any point since 1978. Worse, a disturbing trend toward cronyism has gravely eroded the rule of law and distorted our free-market system.
As Americans look to their future more than ever, 2014 should be the year of action to reverse the startling decline of America’s economic freedom and revitalize its entrepreneurial pulse.