Cato And Heritage Foundations Wrong On Freedom
The war on terrorism has hardly
begun, but it has already demolished the 4th Amendment,
an important basis of our civil liberties. To feel more
secure against Muslim terrorists, we have made ourselves
secure from government.
Patriot Act and the new
Department of Homeland Security override the 4th
Amendment “right of the people to be secure in their
persons, houses, papers and effects, against
unreasonable searches and seizures” as well as its
stipulation that “no Warrants shall be issued, but
upon probable cause . . . particularly describing the
place to be searched and the persons or things to be
Henceforth all Americans can be
electronically searched and monitored without their
In view of this loss, it comes as a
relief to learn from two Washington DC, think tanks that
world economic freedom is on the rise. The Cato
report on economic freedom covers the year 2000 and
finds a rise in the index of economic freedom. The
Heritage Foundation`s 2003 index covers June 2001
through June 2002 and also reports an increase in
Much work and many talented people
are involved in the production of these annual reports.
The indices measure economic freedom similarly, using
the tax, expenditure, and
regulatory burdens of government, soundness of
money, freedom of trade, rule of law and
protection of property rights.
Despite the similarity of measures,
the two indices produce both similar and divergent
results. The reports agree that Hong Kong and Singapore
have the most economic freedom. But the Heritage index
has the U.S. tied for sixth place with Denmark and
Estonia, while the Cato index ranks the U.S. in third
place and puts Estonia 35th.
The indices are constructed with
care, but anomalous results suggest that improvements
are possible. For example, the Cato Institute`s report
notes that “the overall tax burden has been
increasing from 32% of the GDP of OECD nations in 1980
to 37% in 1999.” This means that people in Western
nations, which by and large have the most economic
freedom, have experienced a 15% decline in ownership of
the products of their own labor; yet, the index shows a
paradoxical rise in economic freedom.
Perhaps a problem is that the
measure of economic freedom, constructed by economists,
is ahistorical. Historically, freedom meant that a
person owned his own labor and the products of his
labor. A serf was not free, because he owed the feudal
lord, the government of that time, one-third of his
labor. When capitalism broke up feudalism, it freed
labor from this tax.
income and social security taxes have re-enserfed
populations. Today working Americans and Europeans have
no more claim to their labor and its products than did
feudal serfs. If freedom is measured by what it meant
historically, no Western nation would be ranked as free.
Neither index looks with favor on
government interference with trade or intervention in
labor and credit markets. Both indices, however, fail to
penalize the U.S. and the U.K. for
race and gender quotas that discriminate against
white males in employment, training and university
Race and gender quotas impose costs
and diminish economic freedom just as do import quotas.
In the U.S. race and gender quotas violate the 14th
Amendment, thus raising wider issues of freedom.
There is no justification for
penalizing a country`s ranking for import quotas and
coercive measures such as minimum wage and collective
bargaining, but not for race and gender quotas.
There are similar problems with the
measures of rule of law and property protection. Asset
forfeiture laws in the U.S. have made owners insecure in
their property. Innocent owners have lost homes and
boats because renters used drugs on the premises, thus
making the property subject to forfeiture. People have
had cash confiscated for no other reason than police
ruled that the sum was large enough to imply intent to
buy or sell drugs.
In recent years, the number of
crimes for which property can be confiscated has
increased dramatically. The confiscations are arbitrary,
and owners have little recourse. To be accurate, the
indices of economic freedom must factor in the
insecurity of property that results from asset
Indeed, it is an open question
whether Americans today live under a rule of law or the
rule of regulators. In our book, The
Tyranny of Good Intentions, Lawrence Stratton
show that the legal principles that protect our
civil liberties and our property have been
seriously eroded. Neither index captures this loss
In the Preface to the Cato report,
Milton Friedman suggests that the next step is to weld
together measures of economic, civil, and political
freedom into one index.
This is an excellent suggestion.
Political correctness and “crimes of opinion” in the
U.S. are close to rendering the 1st Amendment no more
operable than the 4th and the 14th Amendments.
It would be
paradoxical to have indices showing rising economic
freedom while all other freedoms plummet.
Craig Roberts is the author with Lawrence M. Stratton of
The Tyranny of Good Intentions : How Prosecutors and
Bureaucrats Are Trampling the Constitution in the Name
of Justice. Click
here for Peter
Magazine interview with Roberts about the recent
epidemic of prosecutorial misconduct.