In her recent column, Heritage Foundation President Kay C. James offered a timely message on why economic freedom matters more than ever. As she emphasized:
The debate in the United States over whether to move away from free markets and toward socialism may change dramatically as the latest coronavirus spreads throughout the world. That’s because in the fight against the global pandemic, we’ll likely witness one of the most compelling arguments in our lifetimes emerge in favor of free-market systems—and lives will be saved in the process.
The pathway by which we can emerge from this pandemic stronger than we were before is through a recommitment to the proven policies of free-market capitalism.
Since its inception in 1995, The Heritage Foundation’s annual Index of Economic Freedom has chronicled hundreds of examples of government policy changes that have enhanced economic freedom, thereby promoting human progress and greater prosperity.
As the index has cataloged, nations with higher degrees of economic freedom prosper. This is because they capitalize more fully on the ability of the free-market system not only to generate, but also to reinforce dynamic growth through efficient resource allocation, value creation, and innovation.
Following are three charts that illustrate the critical importance of preserving and advancing economic freedom.
1. Economic freedom creates wealth. Countries with higher levels of economic freedom have much higher per capita incomes than others.
2. Economic freedom promotes innovation. The positive link between economic freedom and higher levels of innovation ensures greater capacity to cope with various challenges, ensuring a virtuous cycle of creativity and vibrant economic growth.
3. Economic freedom promotes health security capacities. The link between economic freedom and overall human well-being is undeniable. People in economically free societies live longer, have better health, and take better care of the environment.
More critically, they also tend to have greater capability to counter infectious diseases that know no borders, such as the current coronavirus pandemic. Indeed, as The Heritage Foundation’s National Coronavirus Recovery Commission points outs, “Good public health policy is good economic policy.”
The Heritage Foundation’s guiding document “True North: The Principles of Conservatism” reminds us that “America is strongest when our policies protect our national interests, preserve our alliances of free peoples, vigorously counter threats to our security, and advance prosperity through economic freedom at home and abroad.”
As can be clearly seen from the charts above, it would be a tragic mistake to assume that in a time of crisis we must abandon our commitment to economic freedom. That freedom has unambiguously made our society strong, vibrant, and flourishing in the past.
An economically free and dynamic American society can provide the strong response we need now in resurrecting our livelihoods.