I meant to write about this article when it first came out, but it got buried in my inbox. That being said, this Washington Times column by Richard Rahn makes an excellent point about the dangers of too much government. He points out that Argentina used to one of the world’s most prosperous nations. Unfortunately, decades of statism have taken a harsh toll and the Latin American nation now is an economic basket case. Between Bush and Obama, we’ve had about 10 years of bad policy, so it would require lots of additional bad policy to drag America down to the Argentine level, but the trend is definitely in that direction:
A century ago, if you had told typical citizens of Argentina (which at that time was enjoying the fourth-highest per capita income in the world) that it would decline to become just the 76th richest nation on a per capita basis in 2010, they probably would not have found it believable. They might have responded, “This could not happen; we are a nation rich in natural resources, with a great climate for agriculture. Our people are well educated and largely descended from European stock. We have property rights, the rule of law and an open free-market economy.” But the fact is, Argentina has been going downhill for eight decades, and it has the second-worst credit ranking in the entire world – only Venezuela has a lower ranking. Argentina, despite its natural resources and human capital, has managed to throw it all away. Argentina did not become relatively poor because of having been involved in destructive conflicts. It became poor because it has had a series of both democratically elected leaders and non-elected dictators who never missed an opportunity to make the wrong economic decisions. …The U.S. is not yet Argentina, but, if many of the policies of the Obama administration are not reversed, America will only get poorer and, in as little as 30 years, become a middle-income country, while dozens of other countries will enjoy a higher standard of living.