WHY CHILE IS MORE ECONOMICALLY FREE THAN THE UNITED STATES

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In the 2009 Economic Freedom of the World Report, Chile is now number 5, one place ahead of the United States. In 1975, of 72 countries, Chile was No 71. How did this happen?

From 1975 to 1989 a true revolution took place in Chile, involving a radical, comprehensive, and sustained move toward economic and political freedom. This revolution not only doubled Chile's historic rate of economic growth (to an average of 7 percent a year, 84-98), drastically reduced poverty (from 45 percent to 15 percent), and introduced several radical libertarian reforms that set the country on a path toward rapid development.

• Chile was one of the first economies in the developing world to test such concepts as deregulation of industries, privatization of state companies, freeing of prices from government control, and opening of the home market to imports.
• In 1981, Chile privatized its social-security system; many of those ideas ultimately spread throughout Latin America and to the rest of the world.

Not only is Chile now at the top of rankings on free trade (number 3 in the world after Hong Kong and Singapore) and transparency (less corruption that in most western European countries), it is expected to be a developed country by 2018, the first in Latin America.

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