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Report: US states less free than Canadian provinces

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Betsi Fores
The Daily Caller News Foundation

California, New Jersey and Michigan score have some of the lowest scores when it comes to Social Security payments as a percentage of GDP, far lower than any Canadian province.

New York, Nevada, and Montana scored some of the lowest in indirect taxes, again, lower than the levels of Canadian provinces.

Concern with levels of economic freedom stems from the relationship between economic freedom and economic growth. “Not only is economic freedom important for the level of prosperity; growth in economic freedom spurs economic growth,” the report states.

“Economic freedom is very important for prosperity,” Powell explained to The Daily Caller News Foundation.

“Higher levels of economic freedom generate higher income levels, higher growth rates, virtually any living standard we care about.”

A single-point improvement on the economic freedom index at the all-government level would increase per capita GDP by $13,276 for U.S. states, the report claims. The U.S. state level dropped by 0.4 this past year.

Canada ranked fifth in economic freedom out of the 144 nations the Fraser Institute examined, while the United States ranks 18th. The United States fell behind in the index in 2008, following the financial crisis.

The latest study uses data from 2010, which leaves out expanded spending for the Medicare expansion and Affordable Care Act. Powell expects state level spending to only get worse in the coming years.

Data from Mexico have also been collected for comparison with economic freedom in North America, but the data “has been rife with challenges,” according to the report.

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