Making Money panelists Michelle Girard and Chris Low discuss the February Jobs report, the impact on energy prices of the Middle East crisis and the outlook for the Fed.
Americas economic freedom The score rose 2.6 points from a year ago to 72.8, which ranks 22nd out of more than 176 countries that had achieved scores in the index. The 2.6-point increase was the biggest annual gain since 2001 and is the second-biggest jump the U.S. has made in the index in its 32-year history.
Heritage’s Index of Economic Freedom rates twelve economic freedoms that fall into four categories, including the rule of law, size of government, regulatory efficiency and open markets – each of which has three subcategories.
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Pedestrians walk past an American flag displayed outside the New York Stock Exchange (NYSE) in New York on September 12, 2016. (Michael Nagle/Bloomberg via Getty Images)
Kim explained that the progress “is not accidental” and reflects the Trump administration’s initiatives that have implemented “budget cuts” government jobsslowed spending and prioritized private sector growth through proactive, bold deregulation and tax reforms.
While America’s score of 72.8 ranked 22nd in the world, it ranked third in America, trailing only Canada (75.6) and Chile (74.3), respectively. Mexico scored 59.8 and ranked 92nd in the world, and ranked 19th out of 32 countries in the Americas region.
In the rule of law category, the US scored highly in property rights, judicial effectiveness and government integrity, all of which scored well above the world average.
Government size was a relative weakness for the US, with an average tax burden score of 75.3 compared to the global average of 78.4. Government spending scored 57.9 versus the global average of 66.3, while fiscal health was a significant weakness – as the US score of 18.5 was well below the global average of 65.9 due to high government debt and large budget deficits.
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The US rating was boosted by the rule of law, but suffered from a poor fiscal health rating. (J.David Ake/Getty Images)
Aspects of regulatory efficiency According to the report, freedom to do business, labor and monetary policy, among other things, were all well above the global average of the Index.
In terms of open marketsthe US scored 67.6 in trade freedom, which was below the global average of 70.2. However, investment freedom and financial freedom each scored an 80 for the US, well above the global averages of 53.4 and 48.1 respectively.
Kim noted that “the impact of restrictive tariffs on the global economy is much more muted than feared, in light of increased investment in crucial sectors such as energy and AI (among many others),” adding that the lack of tariff retaliation from countries other than China, Canada and the EU mitigated the potential impact of a trade war.
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Taiwan ranks fifth in the world in terms of economic freedom. (I-Hwa Cheng/Bloomberg via Getty Images)
Countries with the highest overall scores in Heritage’s Index of Economic Freedom were Singapore (84.4), Switzerland (83.7%), Ireland (83.3), Australia (80.1) and Taiwan (79.8).
The countries that scored the lowest were among the most oppressed in the world North Korea (3.1) ranked last. Cuba (25.2), Venezuela (27.3), Sudan (32.5) and Zimbabwe (35.2) rounded out the bottom five countries in Heritage’s analysis.
Russia (50.3), China (48.3) and Iran (41.8) were also among the lowest scoring countries in the index due to their repressive political and economic systems.
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Argentine President Javier Milei has led economic reforms that have boosted the country’s position. (Kevin Dietsch/Getty Images)
Argentina’s economic freedom rating saw the largest increase from a year ago of any country in the Heritage index, up 3.2 points from last year.
“The decisive midterm election victory of October 2025 produced a reform-minded president Javier Milei with concrete support and greater momentum to further transform Argentina’s economy,” Kim said.
Kim noted that several other countries, including Oman, the Philippines, Morocco and Paraguay, “have made significant improvements in their scores over the past two years despite challenging economic conditions.”
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He added that Paraguay President Santiago Peña “has unequivocally promoted economic freedom, fought corruption and built alliances with democratic countries.”
