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indigenous
2016 Mar 11, 9:16pm
It goes back further than Obama, true he doubled the debt but Bush doubled it before him. Also how much of the debt from both was mandatory?
Either way the chart in the article indicates that the inflection point was in 2000
If not for the reserve currency status the US might be much lower than 10.
It just boils down to too much regulation forcing companies to go off shore. The mutts will say that this was because the fat cats could get cheaper labor. The reality is that a business has to have a good reason to go offshore lower labor costs are not a good enough reason.
Other countries have a strong currency e.g. Switzerland has a trade surplus despite having a very strong currency.
The pathology of the US goes beyond and single president.
indigenous
2016 Mar 12, 9:01am
Horseshit, derivatives were not regulated and RE over-invested with Fed money
What Killed Economic Growth?
What in particular accounts for the largest portion of this slide? It’s about the security of property. The drug war, the bailouts, the rise of forced transfers to political elites, eminent domain, and asset forfeiture all contribute. There are other problems with regulation and taxation, but it is the lack of security in what we own that has been decisive. This is what kills investment, confidence in the future, and the ability to accumulate capital that is so essential to prosperity.
It just boils down to too much regulation forcing companies to go off shore. The mutts will say that this was because the fat cats could get cheaper labor. The reality is that a business has to have a good reason to go offshore lower labor costs are not a good enough reason.
Didn't read your own article did you? The mentioned reasons for the slide in the index don't jive with being too much regulation. Does anyone seriously believe that there is any concern at all within the business community about things like the drug war which is mostly fought in the ghettos or cops grabbing cash at traffic stops. Ridiculous. The supreme court decision on eminent domain went in favor of private business. Bailouts were to bail out private business. Where is the excess regulation in any of this?
indigenous
2016 Mar 12, 8:19pm
Didn't watch the video did you? Look at 1:20 where they state that there are 81,000 pages of federal regulations.
This is the same reason that India has not grown more, that and corruption
What goes hand in hand with over regulation is regime uncertainty, I know this for a fact anecdotaly as well as what they are saying statistically.
Sometimes it’s good to look at the big picture. The Economic Freedom of the World report does this with incredible expertise.
Really? The fraisure institute is a private libertarian think tank funded by non disclosed corporate contributions. The economic freedom report has been criticized extensively for not matching up to the real world. De Haan and Siermann as well as Heckelman and Stroup have written well documented criticisms of the problems with the report.
New Zealand third in the world in economic freedom? Totally absurd. NZ is a semi socialist country with a high level of government regulation in almost every part of business and society. With high taxes and a large social safety net to boot. The only aspect of NZ that represents freedom is a total lack of lawsuits. That's due to a government agency called ACC accident compensation commission. All accidents are no fault and ACC pays lost wages. Medial is already covered with public health care. No one can sue. The down side is everything you do has an ACC levy associated with it Want to register you car for the year fork over $500 for ACC levy. Motorcycle is $1000. Run a roofing company send big bucks to the ACC. Does this show up as taxes? No.
Speaking of roofing if you want your house roofed in NZ you need to lease a scaffold that goes completely around the house for the roofers to work off of. ACC regulation. My roofing job on a 1800 sq foot 1 story house cost me $15000 with $3000 for scaffolding lease. That was the low bidder.
Just goes to show that the numbers don't reflect the true situation on the ground and the parameters selected for the entire economic freedom report is very suspect.
Didn't watch the video did you? Look at 1:20 where they state that there are 81,000 pages of federal regulations.
and where does that jive with the reasons given for the slide in the index? shuck and jive. shuck and jive.
What goes hand in hand with over regulation is regime uncertainty
So places like scandanavia, the most regulated countries in the world have regime uncertainty? Really?
Strategist
2016 Mar 12, 8:51pm
What goes hand in hand with over regulation is regime uncertainty
So places like scandanavia, the most regulated countries in the world have regime uncertainty? Really?
The most regulated countries would be communist countries like N Korea, Cuba, and Venezuela. There is no certainty there. Venezuela, an oil rich country is about to default on it's debt.
indigenous
2016 Mar 12, 8:56pm
If you saying that these charts are specious, what do propose to replace them with? The GINI coefficient?
I don't know about the index they use but the Heritage index (which ranks the US as 11th) works as follows:
How do you measure economic freedom?
We measure economic freedom based on 10 quantitative and qualitative factors, grouped into four broad categories, or pillars, of economic freedom:
1 Rule of Law (property rights, freedom from corruption);
2 Limited Government (fiscal freedom, government spending);
3 Regulatory Efficiency (business freedom, labor freedom, monetary freedom); and
4 Open Markets (trade freedom, investment freedom, financial freedom).
Each of the ten economic freedoms within these categories is graded on a scale of 0 to 100. A country’s overall score is derived by averaging these ten economic freedoms, with equal weight being given to each. More information on the grading and methodology can be found in the appendix.
indigenous
2016 Mar 12, 9:04pm
and where does that jive with the reasons given for the slide in the index? shuck and jive. shuck and jive.
No shuck and jive watch the video.
So places like scandanavia, the most regulated countries in the world have regime uncertainty? Really?
The question is whether or not the regulations are predictable. e.g. one of my biggest customers in the health care industry postponed purchases from me until they could see what the fall out was going to be from the ACA.. Similar things happened under FDR.
The most regulated countries would be communist countries like N Korea, Cuba, and Venezuela. There is no certainty there. Venezuela, an oil rich country is about to default on it's debt.
You are saying scandanavian countries aren't heavily regulated?
and where does that jive with the reasons given for the slide in the index? shuck and jive. shuck and jive.
No shuck and jive watch the video.
No it's a simple question and you are playing dodgem. None of the reasons given for the US decline in the index according to YOUR article have anything to do with excess regulation yet you claim the index shows a decline due to excess regulation/ How is that possible?
I don't know about the index they use but the Heritage index (which ranks the US as 11th) works as follows:
The heritage foundation is the fraisure index report. They reprint it
I read the methodology , what is missing is any type of explanation how these are calculated or weighted. You can't just take a bunch of numbers from the wto and other international organizations You have to know what they mean within the context of the country. The index says Hong Kong has low taxes, yea that's because they own all the land and are collecting rent from every person and business. Where does that go on the index? It doesn't. It's impossible to compare countries directly without doing a very in depth analysis of each countries laws and institutions. Which no one would even begin to attempt.
So places like scandanavia, the most regulated countries in the world have regime uncertainty? Really?
The question is whether or not the regulations are predictable. e.g. one of my biggest customers in the health care industry postponed purchases from me until they could see what the fall out was going to be from the ACA.. Similar things happened under FDR.
Similar things happen in every country in the world all the time. Laws change everywhere all the time.
indigenous
2016 Mar 12, 9:57pm
what is missing is any type of explanation how these are calculated or weighted.
We can agree that N Korea is probably the most un-free and Switzerland, Honk Kong, Singapore, New Zealand, Australia are the most free?
Anecdotal experience is going to change subjective views.
Apparently you advocate no index at all. I disagree, a flawed index is better than none.
indigenous
2016 Mar 12, 9:58pm
Similar things happen in every country in the world all the time. Laws change everywhere all the time.
Which is what creates hot money coming into this country or investor saying deal me out, in the case of FDR it was for 10 years.
Anecdotal experience is going to change subjective views.
Apparently you advocate no index at all. I disagree, a flawed index is better than none.
I don't need anecdotal experience. I've lived, worked, run a business, and done construction in both australia and new zealand. I know how the systems work and having some index say they are among the most economically free countries in the world is pure bullshit. Both have large governments, stringent regulations on business and personal, strong labour laws, large social programs, etc..
Maybe you should try thinking instead of just taking whatever you find on mises.org as the holy grail. Who has economic freedom in places like nz/oz? Average workers? Not hardly. Both countries (as well as singapore/hong kong that you are so enamoured with) have some of the least affordable housing on the planet courtesy of stringent land use regulations combined with very extensive and expensive regulations on building/builders. If you actually look at the economic freedom index it pretty much tracks housing affordability starting from the least affordable country on down. How does struggling to afford shelter represent economic freedom? How about manufacturers? Nope. High real estate costs, high regulatory costs (environmental, safety, tax compliance etc.) , high labour costs, tough labour laws. Manufacturers are heading for Vietnam (very low on the economic freedom index) not nz/oz. Retail/wholesale? Same problems. Farming? Ditto, actually double ditto on environmental laws for farmers.
But wait, there is one industry that doesn't have these problems. It uses very little real estate, has mostly salaried employees not subject to labour laws, doesn't have any concerns about worker safety or environmental laws, moves capital around the world to avoid high taxes local business can't avoid, etc. etc. That would be banking/finance.
Congratulations, you've discovered a list of countries that are best for banking. How much do you want to bet that the majority of the unknown supporters of the fraiser institute are in banking/finance? Not that anyone will ever be able to find out.
Then what countries do you consider the freest and why?
Free at what? Banking? Manufacturing? Farming? Social issues? Labour Unions? Personal finance? Taxes? Government regulation? Crime?
If I wanted to set up a factory I'd be in Vietnam,(or a UAE free trade zone) but banking or real estate rentals there would be a nightmare. Banking in Singapore is a snap, a factory would be terrible. If I wanted to be part of a gay couple Scandinavia would be the place, the middle east not so good. If I wanted to set up a kitesurfing school (as long as I didn't want to hire anyone) New Zealand with no tort liability would be terrific. in the US/Canada not good at all. Farming would be south america,but certainly not anywhere in europe. Set up a trust fund rarotonga wins hands down, the US no way. No taxes with great lifestyle, Andorra, San Marino, Campione d'Italia (good luck with that) no question about it. If I wanted to launder money (assuming I'm not a US citizen) the US is far and way the best place on the planet.
That's what makes your list absurd. The phrase economic freedom means nothing. Saying economic growth was killed because of some imaginary freedom index is even more absurd. How can a bunch of conflicting goals be quantified within one country, never mind being compared between countries. Especially when there are different meanings to do many things country to country. Without a detailed knowledge of countries legal, governmental, economic, and social system you just can't compare countries reliably. People who think they can are just deluded.
The only way to determine what country is the most free for what you want to accomplish is do your research then put your feet on the ground and see.
indigenous
2016 Mar 14, 9:16am
I would think freedom to raise your standard of living through the creation of new jobs. Regulation is anathema to this. So I would say regulation is at the top of the list, followed by private property, etc.
Your standard answer to everything is to wallow in the minutiae and discount and macro/conceptual disposition.
I don't think a metric of these factors is absurd at all. As the growth in government, because it has no price discovery, is a drain on the economy.
Regulation is anathema to this. So I would say regulation is at the top of the list, followed by private property, etc.
So regulations that protect your property rights, insure honest commerce, prevent corporations from turning the entire country into a toxic wasteland, keep corporations from selling toxic food, preventing misrepresenting products, prevent dishonest business practices, etc. etc. etc. are taking away your freedoms and preventing the creation of new jobs? What an interesting world you live in.
As the growth in government, because it has no price discovery, is a drain on the economy.
So things like airports, roads, rails, ports, communication, courts, police, military, water, sewer, internet, electricity, etc., etc., etc. are a drain on the economy? I can certainly see that from looking at how wealthy the countries that don't have those things are. Nigeria and Somalia come to mind.
No it's a simple question and you are playing dodgem. None of the reasons given for the US decline in the index according to YOUR article have anything to do with excess regulation yet you claim the index shows a decline due to excess regulation/ How is that possible?
As usual you are hiding from direct questions you can't answer. I hear crickets.
Strategist
2016 Mar 14, 7:24pm
The most regulated countries would be communist countries like N Korea, Cuba, and Venezuela. There is no certainty there. Venezuela, an oil rich country is about to default on it's debt.
You are saying scandanavian countries aren't heavily regulated?
No where close to the countries I mentioned.
The most regulated countries would be communist countries like N Korea, Cuba, and Venezuela. There is no certainty there. Venezuela, an oil rich country is about to default on it's debt.
You are saying scandanavian countries aren't heavily regulated?
No where close to the countries I mentioned.
N. Korea, Cuba, and Venezuela have no rule of law and aren't even communist, they are run by whims of dictators calling themselves communist. Choose functional countries next time. Why don't you throw Nigeria and Somalia in as the least regulated. They have such roaring economies and high wealth.
China, Vietnam, and Laos are communist. Do you think they are more or less regulated than places like India (rated most over regulated country in the world on a recent survey http://articles.economictimes.indiatimes.com/2011-01-27/news/28432561_1_survey-economic-risk-consultancy-bandwidth) or Scandinavia. or even (drum roll please) Australia. http://cairnsnews.org/2015/09/28/australia-the-most-over-governed-and-over-regulated-country-on-earth/
Strategist
2016 Mar 14, 8:31pm
Why don't you throw Nigeria and Somalia in as the least regulated. They have such roaring economies and high wealth.
They are regulated by Islam, which is why they are a disaster. Almost every Muslim country is a disaster, dependent on oil welfare.
indigenous
2016 Mar 14, 10:05pm
So regulations that protect your property rights, insure honest commerce, prevent corporations from turning the entire country into a toxic wasteland, keep corporations from selling toxic food, preventing misrepresenting products, prevent dishonest business practices, etc. etc. etc. are taking away your freedoms and preventing the creation of new jobs? What an interesting world you live in.
You act as though this is binary. Some regulation is necessary but that ship sailed a looong time ago. Notice the 19 trillion dollars of debt?
So things like airports, roads, rails, ports, communication, courts, police, military, water, sewer, internet, electricity, etc., etc., etc. are a drain on the economy? I can certainly see that from looking at how wealthy the countries that don't have those things are. Nigeria and Somalia come to mind.
They certainly are in China because of a lack of price discovery. I'm referring to cops in Calif with a 6 figure salary and retirement, I'm referring to 1/3 of the federal budget going to defense, I', referring to almost all congressman leaving Washington worth many millions despite the fact that they arrived there much poorer, I'm referring to a huge percentage of the budget going to corporate welfare, etc. etc. etc.
The fact is that almost NONE of the items you list could not easily be privatized WITH price discovery.
Not to mention that the government largess is taken directly out of the economy making it that much harder on the private sector.
BTW Somalia has been steadily improving in their economy and there standard of living. Down the road Nigeria figures to be a great investment.
indigenous
2016 Mar 14, 10:55pm
Banks have to be regulated. When they are not, the Fed uses them to misprice risk.
They would need a lot less regulation if the taxpayer did not bail them out.
Some regulation is necessary but that ship sailed a looong time ago.
They certainly are in China because of a lack of price discovery. I'm referring to cops in Calif with a 6 figure salary and retirement, I'm referring to 1/3 of the federal budget going to defense, I', referring to almost all congressman leaving Washington worth many millions despite the fact that they arrived there much poorer, I'm referring to a huge percentage of the budget going to corporate welfare, etc. etc. etc.
Your standard answer to everything is to wallow in the minutiae and discount and macro/conceptual disposition
What's with all this minutiae we are wallowing in here? What happened to macro/conceptual disposition?
Oh I get it. If the details don't agree with you, especially if you can't come up with any answers from your book of standard libertarian claptrap, it's minutia.
Why don't you throw Nigeria and Somalia in as the least regulated. They have such roaring economies and high wealth.
They are regulated by Islam, which is why they are a disaster. Almost every Muslim country is a disaster, dependent on oil welfare.
Nigeria isn't Muslim. Ok lets move to the Congo or Zimbabwe or Bhutan or Paraguay then. They are not muslim or have oil. What happened there? They don't have any government spending on infrastructure or welfare. The wealth should be overflowing based on the libertarian mantra.
Strategist
2016 Mar 15, 6:40am
Nigeria isn't Muslim. Ok lets move to the Congo or Zimbabwe or Bhutan or Paraguay then. They are not muslim or have oil. What happened there? They don't have any government spending on infrastructure or welfare. The wealth should be overflowing based on the libertarian mantra.
They aren't educated enough.
Look, there is no one magic key when it comes to a country's development. Some things will encourage progress and some things will discourage progress. Excessive restrictions, be it sharia laws that restrict freedoms, or communist laws that suppress incentives to produce, will all result in a backward country.
indigenous
2016 Mar 15, 8:17am
Oh I get it. If the details don't agree with you, especially if you can't come up with any answers from your book of standard libertarian claptrap, it's minutia.
No you don't, your standard MO is to jump over the point in an attempt to disprove it by disproving the minutiae. In this case you are doing this to avoid the valid arguments about price discovery.
indigenous
2016 Mar 15, 8:18am
hat probably would have made the Great Recession much worse.
No it wouldn't of. It is a necessary part of the economy to discover what the prices should be reset to.
Debating why the economy is so sluggish is an American pastime. It fills the op-eds, burns up the blogosphere, consumes the TV pundits, and dominates the political debates.
It's a hugely important question because many people are seriously frustrated about the problem. The recent popularity of political cranks and crazies from the left and right - backed by crowds embracing nativist and redistributionist nostrums - testify to that.
Sometimes it's good to look at the big picture. The Economic Freedom of the World report does this with incredible expertise. If you believe in gathering data, and looking just at what the evidence shows and drawing conclusions, you will appreciate this report. It sticks to just what we know and what we can measure. The editors of the report have been doing this since 1996, so the persistence of the appearance of cause and effect is undeniable.
The report seeks measures of five key indicators of economic freedom: security of property rights, soundness of money, size of government, freedom to trade globally, and the extent of regulation. All their measures are transparent and heavily scrutinized by experts on an ongoing basis. If you question how a certain measure was arrived at, you are free to do so. It's all there, even the fantastically detailed data sets, free for the download.
The report examines 157 countries with data available for 100 countries back to 1980. A total of 42 distinct variables are used in the index.
The big takeaway from this report: freer economies vastly outperform unfree economies by every measure of wellbeing.
The countries in the top quarter of the freest economies have average incomes more than 7 times higher than those countries listed into the bottom quarter (the least free). This is even true for the poor: the average income of the poor in free economies is 6 times that of the average in unfree economies. The lowest income group in free economies still 50% greater than the overall average is least free economies.
Life expectancy is 80.1 years in the top quarter as versus 63.1 in the bottom quarter.
The report further shows that civil liberties are more protected in freer economies than less free economies.
It's a beautiful thing how this report puts to rest a century of ideological debates. Indeed, these results are not generated by political ideology. They are generated by facts on the ground, the real conditions of law, regulation, institutions, legislation, and policy.
The implications are screamingly obvious. If you want a country to grow richer, you have to embrace freedom in economic life. If you want to drive a country into poverty, there is a way: grow the government, destroy the money, shut down trade, and heavily regulate all production and consumption.
One leaves this report with the question: Why are we still debating this?
What about the United States?
Everyone knows that the US has a problem. Despite living through the greatest explosion of technology and communication in the history of the world, a transformation that should have set off a wonderful economic boom similar to what we saw in the 19th century, we've seen pathetic results in growth and household income.
A quick casual look shows what I mean. Here's percent change in GDP from the end of World War II to the present.
From those two pictures alone, you can discern the source of voter frustration, and also the general atmosphere of angst.
People want to know why, and whom to blame. The Economic Freedom Index gives you a strong hint.
From 1970 to 2000, the United States was generally listed as the third freest economy in the world, behind only Singapore and Hong. Starting in 2000, the US began to slip. Over the period between 2000 and today, the summary position in the index slipped 0.9%. This doesn't sound like much, but "a one-point decline in the EFW rating is associated with a reduction in the long-term growth of GDP of between 1.0 and 1.5 percentage points annually,†says the report, and this adds up, year after year.
Relative to other countries, listed most free to least free, the US has slipped from the number 3 spot all the way to number 16. Countries that are ahead of the US include Australia, Chile, Ireland, Canada, Jordan, Taiwan, New Zealand, Hong Kong, and Singapore.
And here is a fact that I found incredible: The former Soviet state of Georgia ranks at number 12. And can you guess which country is just behind the US at number 17? The formerly Communist nightmare of Romania. That Romania is only slightly less free than the United States is great progress for Romanians, but should be an embarrassment for Americans.
The fall in economic freedom in this country has been precipitous. The authors of the report further note that this decline is highly unusual. Most all countries in the world are getting freer, which accounts from the thrilling fall in global poverty.
But the US is going the opposite direction, fast: "Nowhere has the reversal of the rising trend in the economic freedom been more evident than in the United States.â€
What in particular accounts for the largest portion of this slide? It's about the security of property. The drug war, the bailouts, the rise of forced transfers to political elites, eminent domain, and asset forfeiture all contribute. There are other problems with regulation and taxation, but it is the lack of security in what we own that has been decisive. This is what kills investment, confidence in the future, and the ability to accumulate capital that is so essential to prosperity.
What's strikes me when looking at all this data, and the crystal clear connections here, is the strange silence on the part of the opinion class. People are flailing around for answers. Where's the growth? Who is stealing the future? Maybe it's the immigrants, foreign nations, and the rise of inequality. Maybe technology is taking jobs. Maybe people are just lazy and incompetent.
Or maybe we should look at the data. It's all about freedom.
www.F4fWQnguR1E
http://fee.org/articles/what-killed-economic-growth/