The freedom lover's case for the welfare state

9/1/2016 - Distinguished Professor of Economics Peter Lindert at Vox.

American exceptionalism has been propelled by exceptionally free markets, so it’s tempting to think the United States has a freer economy than Western European countries — particularly those soft-socialist Scandinavian social democracies with punishing tax burdens and lavish, even coddling, welfare states. As late as 2000, the American economy was indeed the freest in the West. But something strange has happened since: Economic freedom in the United States has dropped at an alarming rate.

When we look at the family of advanced, liberal democratic countries, countries that spend a smaller portion of national income on social transfer programs gain very little in terms of growth relative to countries that spend much more lavishly on social programs. Peter Lindert, an economist at the University of California Davis, calls this the "free lunch paradox."

Read the full story at Vox.