O Intermitente
(So long, farewell, auf weidersehen, good-bye)

sexta-feira, julho 23, 2004

Free to Adjust

Excerto do artigo Olaf Gersemann sobre o EFW de 2004.

The report - published by the Fraser Institute, the Cato Institute, and other think tanks - (...) shows that since the 1980s there has been a close link between economic freedom and economic growth. What is more, however, is that there is evidence that the link between freedom and prosperity has become stronger over the last quarter century.

To see why, compare the U.S. to the Big Three among continental European countries. In the new report, Germany is ranked 22nd; Italy, 36; and France, 44. This placing reflects the fact that these countries have not kissed big government goodbye. There has been no German Ronald Reagan and no French Margaret Thatcher.

However, the post-war economic systems of France, Germany, and Italy have always been more restricted by regulations and high tax burdens than America's. Still, in the first decades after World War II, this did not stymie economic growth in continental Europe. The prosperity gap between America and Europe's Big Three shrank. Then, starting in the early 1980s, the gap slowly but relatively steadily widened again. The result is that in recent years the prosperity gap between France and Western Germany on the one hand and the U.S. on the other was as big as it has been since the late 1960s. In other words, for quite a while European-style "comfy capitalism" seemed to work as good as U.S.-style "cowboy capitalism". But that is no longer true.

What happened? Firstly, there was a time in which economic policy mistakes had little impact, if only because there were many other governments that made far more basic mistakes -- remember communism? After all, it's easier to compete with countries whose governments systematically destroy their economies' dynamism. But today, according to the Economic Freedom report, Estonia has a freer economy than Germany has; Hungary is ahead of Italy; and Latvia and the Czech Republic do better than France.

posted by Miguel Noronha 12:50 da tarde