The Heritage Foundation, my new employer, released its 2025 Index of Economic Freedom, a comprehensive analysis of global economic conditions. You can read the highlights here.
Rather than getting lost in methodological details, let’s look at what most readers want to know: the rankings.
The top 10 countries are Singapore, Switzerland, Ireland, Taiwan, Luxembourg, Australia, Denmark, Estonia, Norway and the Netherlands. Readers may be surprised to learn that the United States is not part of this elite group. In fact, we find ourselves far down the list at number 26 – a position that raises serious questions about the current state of economic policy in the world’s largest economy.
Based on data from the latter half of 2023 through mid-2024, the Index evaluates freedom through four key pillars: Rule of Law, Government Size, Regulatory Efficiency, and Open Markets. Though committed to timeliness, the Index incorporates some historical data – particularly for components like monetary freedom – highlighting the challenge of capturing real-time economic shifts.
It paints a sobering picture of a planet still shackled by institutional constraints. Despite a modest 1.1-point increase in the global average score to 59.7, the larger trend is one of stagnation.
Much of the world remains mired in persistent economic unfreedom. Only 87 of the 176 rated nations provide even a moderately free environment. The rest remain trapped in webs of bureaucracy and counterproductive policy, stifling growth and opportunity.
Argentina offers a rare glimmer of hope. Its reform-minded president, Javier Milei, has introduced bold policies that are lifting the country from its economic malaise – a testament to how principled leadership can reverse course.
What’s dragging the United States down? While the nation still earns high marks for property rights – part of the Index’s Rule of Law pillar – runaway government spending remains its Achilles’ heel.
The Index levels a fatal blow to the commonplace portrayal of Nordic nations as socialist utopias. Progressive darlings Bernie Sanders and Alexandria Ocasio-Cortez have long held up Denmark, Finland, Iceland, Norway and Sweden as paragons of state-driven redistribution. Yet the Index reveals an inconvenient truth that shatters this ideological fantasy.
These countries – far from the centrally planned economies of leftist imagination – actually embody robust free enterprise. They outperform the United States not through heavy-handed government intervention but through open markets and institutional efficiency. The Index exposes the fundamental disconnect between progressive rhetoric and economic reality: these nations succeed precisely because they are more economically free, not less.
It’s a delicious irony that the very countries cited as examples of “socialism” are, in fact, more committed to market principles than the United States. Perhaps Sanders and Ocasio-Cortez should trade their talking points for spreadsheets. The numbers tell a far more compelling story than rhetoric — one of untapped economic potential if only we have the wisdom to heed it.
U.S. policymakers would do well to treat this Index not as an academic exercise but as a roadmap for renewal. Market liberty is not a luxury; it is the very oxygen of prosperity.
Allen Mendenhall is Associate Dean and Grady Rosier Professor in the Sorrell College of Business at Troy University and Executive Director of the Manuel H. Johnson Center for Political Economy. Visit his website at AllenMendenhall.com.
The views and opinions expressed here are those of the author and do not necessarily reflect the policy or position of 1819 News.
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