Masters of the world’s economies are converging on the small resort town of Davos, Switzerland, this week for the annual World Economic Forum (WEF). These “Davos M[e]n” include the world’s top business leaders, central bankers, and politicians.
Aside from all the glad-handing, participants of the WEF will discuss some of the more serious issues facing the world economy. Europe remains embroiled in a debt crisis, the U.S. suffers from incredibly low labor market participation, and the Bank of Japan recently announced open-ended monetary policy to mitigate deflation and help its stagnating economy.
Representing the U.S. is a Congressional delegation led by House Majority Leader Eric Cantor (R–VA). These Members will have the opportunity to attend forums including “The Rise of Unconventional Monetary Policy,” “Shaping Syria’s Future,” and “Unemployed or Unemployable.”
What’s not on the agenda, however, is economic freedom. This is a problem. According to the Heritage Foundation’s 2013 Index of Economic Freedom, the world’s average economic freedom continues its five-year stagnation. Perceptions of corruption and out-of-control debt in developed economies continue to suppress the entrepreneurial capacities of billions and put an economic recovery in jeopardy.
If the U.S. delegation and other world leaders should take their cue from anyone, it should be attendees from emerging markets. Of the eight countries to join the Index’s “Mostly Free” category, seven came from emerging markets. In addition:
Five emerging economies [Colombia, Indonesia, Jordan, Poland, and the UAE] have recorded notable increases in economic freedom over the past five years, maintaining high economic growth rates despite the difficult international economic environment.
Leaders from these emerging economies are finally realizing the benefits of economic freedom, including cleaner environments, better education and health, and more prosperity. If the U.S. and other developed countries want to return to the path of growth and prosperity, they must again embrace the merits of economic freedom.
For a long time industrialized countries lectured their developing counterparts about the need to embrace the market and economic freedom. Maybe the WEF will be an opportunity for the professor to get a lesson from its pupil.