Burlington High School
Burlington, Kansas
Teacher: Devra Parker
Landing A Free Economy
By Karen Bailey
12th Grade
Do we really know how free our economy is? Are we sure we are running it right? Are we sure that in a few hundred years our economy will not go down hill? Well, there are people out there that know all these answers and more. They even know how free our economy is. They probably even know when we may have to start all over. I do know that it is interesting to compare the economic freedom for the countries of Ireland, Taiwan, China, and Myanmar.
Out of all of the countries I chose, Ireland was the freest of them all. Ireland, unlike the rest of them, is modern and relatively small. This country has a couple things going for them. They have there agriculture and technology. Most of their employments are in the financing and catering jobs. They still have a small number of unemployment.
Ireland’s government controls some large key parts of their economy. Some of them are their bus and railway markets, electricity, radio and television channels (which means no propaganda), and the last is their aviation. I think that is why they are on the economically free list.
My second country is Taiwan, which is mostly free. Taiwan is mostly free because it has a dynamic capitalist economy with gradually decreasing guidance of investment and foreign trade by the government. Some large government-owned banks and industrial firms are being privatized.
Through nearly five decades of hard work and sound economic management, Taiwan has transformed itself from an underdeveloped, agricultural island to an economic power that is a leading producer of high-technology goods. Taiwan is now a creditor economy, holding one of the world's largest foreign exchange reserves of more than $100 billion (100 G$) in 1999. Despite the Asian financial crisis, the economy continues to expand at about 5% per year, with virtually full employment and low inflation. Taiwan has transformed itself from a recipient of U.S. aid in the 1950s to an aid donor and major foreign investor, especially in Asia. The private Taiwan investment is estimated to a total of more than $30 billion, and Taiwan has invested a comparable amounts into Southeast Asia.
The third country is China; they are a mostly unfree economy. They have the second largest economy in the world, which was measured by purchasing power parity. China’s huge population of 1.3 billion results in their relatively low per capita income of $6,193, and in 2005, China is the fastest-growing major economy in the world.
Since 1978, China’s government has been reforming its economy from a Soviet style to a more market oriented economy, but it will still have a rigid political framework of the Communist Party of China control. It will end up being one type of mixed economy and called “Socialism with Chinese characteristics.
China is still going to have some challenges. One of these is that between 1995 and 1999 the inflation dropped sharply, which reflected tighter monetary policies with banks and stronger measures to control food prices. While that was happening, the government struggled to collect revenues due to provinces, businesses and the individuals that were reduced by corruption and other economic crimes. So, they are trying to do the best they can right now to help out their economy. GO, CHINA, GO!!!!
The last and final country is from the repressed category. Its Myanmar, which used to be called Burma. They are the largest country in mainland Southeast Asia. They used to be ruled by a military junta but now its political system is under a tight control of its military government, led by Senior General Than Shwe.
Myanmar is a mixed economy. The private sector is dominating in agriculture, light industry, and transport activities. Their government policy which has been going on for 11 years, was aimed at the revitalization of the economy for three decades of tight central planning. Recently many of the reforms have been cancelled, which has enabled the private sector to grow
A major ongoing problem is the failure of achieving monetary and fiscal stability. That is why Myanmar remains a poor Asian country without the improvement of living standards for the majority of the population over the past decade. Hopefully, now since the latest government initiatives is to utilize their large natural gas deposits they maybe able to raise their economy, even though it will still take a long time to do that too.
I do know that it is interesting to compare the economic freedom for the countries of Ireland, Taiwan, China, and Myanmar. I think that Myanmar is going in the right direction on trying to bring up their economy by using more of their natural resources, but then that could also be a bad thing. I think that it’s a negative endeavor for Ireland to be using as much of its resources that it uses. I know that soon nations like Ireland or even the United States will run out and they won’t know what to do next because they are so used to how they live now. I think at some point that every nation needs to start using less and less so its land can make more, even though it will take hundreds and maybe even thousands of years to do so. But, to remain or become economically free, a nation needs to do something about its land and natural resources. Inherently, the land will be the deciding factor in the freedom every nation can or cannot enjoy.
Answers To Questions Prompted By The Required Reading
The Benefits of Free Trade
Q1- Be the Devil's Advocate and counter Benjamin Franklin's statement that "No nation was ever ruined by trade."
When I read Benjamin Franklin’s statement saying “No nation was ever ruined by trade.” It made me think that some nation have been ruined by trade. Look at the U.S. for example, we are really far in debt and some of it is because we have been trading, but the other side is that the countries that we are trading with are still letting us trade with them and letting us get in a deeper whole than what we already are.
Index of Economic Freedom and Annual Report (Chapter 3 for links to countries)
Q2- Name five countries whose ranking surprised you.
The five countries whose rankings surprised me were Barbados, Malta, Ukraine, India, and Rwanda.
Q3- Write one sentence each to explain why you chose the countries you did in Q2.
Barbados, because I had no clue where this country was at, but now I know that it is an island. I chose Malta for the same reason, but with this country I never heard of it before but now I have. I now know that it is mostly free and is in Europe. The Ukraine, because they do a lot of sports and things I just thought that they would be mostly free instead of mostly unfree. India because I just considered that they would be mostly free or even free since they are one of the largest economic countries in the world. Lastly Rwanda I thought that they would be repressed since they just got over with a genocide, but hey we all have to be wrong at some point in our lifetime.
Q4- The USA was not ranked first in any of the years exhibited online in the Annual Report nor in the 2005 Index. List the twelve countries that ranked higher on the Index and the countries that out ranked the USA in the eight Annual Reports.
The twelve countries that ranked higher on the Index than the United States are Hong Kong as number one, Singapore in 2nd place, then Luxemburg, next comes Estonia in 4th place, Ireland, New Zealand, United Kingdom in 7th place, next comes Denmark, Iceland, Australia, Chile, and Switzerland in the 12th position.
Q5- The Index uses 50 variables in 10 categories. The Report shows 21 variables in 5 categories and lists 24 sub-variables in its online charts.
As a class project, we investigated the ten categories of the index; However, we could not gather enough information to answer this question.