House Majority Leader Eric Cantor said the new Republican majority possesses a second chance to reclaim the country’s position as one of the “freest” economies in the world.
Cantor joined The Heritage Foundation Wednesday to discuss the U.S. ranking on Heritage’s “Index of Economic Freedom.” The U.S. fell in Heritage’s rankings for the second year in a row, dropping to nine out of 179 countries and placing the U.S. in the “mostly free” economies category, rather than “freest” economies category.
Canada sits ahead of the U.S. in sixth place in the “freest” category. Heritage measures economic freedom based on 10 factors, including government spending, the degree of government interference and the tax burden.
“This is a wake-up call,” Cantor said. “Restoring economic freedom and prosperity is a top priority for this Republican majority.”
Kim Holmes, editor of the “Index of Economic Freedom” and vice president of foreign and defense policy studies at Heritage, said increases in government spending, a decrease in the value of a dollar, intervention in the housing market, and the passage of health care regulations contributed to the decline of U.S. economic freedom. Cantor asked Republicans to reverse the trend.
“In short time, it’s my hope that this Congress, under a Republican majority, will become known as a cut and grow Congress,” he said.
Cantor called for a focus on increasing entrepreneurship and growing the private sector. He said a trust in American innovative spirit, self-sufficiency and entrepreneurship will keep the U.S. in the first category of “freest” nations.
The U.S. must also return to 2008 spending levels or less by using three elements: focusing on jobs, cutting spending and shrinking government in order to help the U.S. regain a higher ranking.
Cantor lauded the need to offset spending with equal cuts and repealing the health care bill, as well. He said patient-centered, affordable and flexible health care must replace Obamacare.
Holmes blamed President Obama for the lower score, but also attributed some of the blame to the last years of former President George W. Bush.
“High government spending has been around for a number of years,” he said.
The U.S. ranks 122 in the government spending category, placing the country in the bottom third with countries like Belarus, Spain and Bolivia.
Despite the U.S. decline in economic freedom, the global trend looks positive.
“The trend globally is toward more economic freedom and we’re going in the opposite direction,” Holmes said. “If we continue in this direction we could be leading ourselves into economic decline.”