Economic freedom in U.S. declined in Trump's first year back, Fraser Institute projects

The Fraser Institute, a think tank that advocates free-market policies, says U.S. economic freedom declined during the first year of Donald Trump's second term, according to its Economic Freedom of the World index. The index uses 46 indicators grouped into five areas and has been used in more than 1,000 peer-reviewed studies.

The latest year with complete data for all countries is 2024, when the U.S. scored 8.21 out of 10, ranking 5th of 165 countries. The author's preliminary estimate puts the U.S. at 8.09 for 2025, which would rank 7th, assuming no other countries changed.

The Fraser Institute attributes the decline to three of the index's five areas. It says government size increased, with rising transfers and subsidies and government acquisition of equity stakes in more than two dozen firms. Property rights and judicial independence and even-handed contract enforcement declined, with the property rights area showing the largest recorded single-year drop. Trade freedom fell as tariffs, which the article calls the signature economic policy of the second Trump administration, rose; the average U.S. tariff rate rose fivefold in the first year to 16.8 per cent, and the trade freedom score fell 0.35 points, the largest single-year decline on record.

The monetary area was the only one showing a clear positive trend. The article notes the Federal Reserve continued monetary restraint despite pressure from the president, and that 2025 inflation was lower and more stable than in 2024.

The 2025 figures are the author's preliminary projection; no final index data for 2025 is given.