It's the liberty, not the spending, Stupid!
I am sure that nothing in this report - even though it emanates from a branch of what conspiracy-theorists call "Them" - will change minds on either side of the political divide. As the Adam Smith Institute comments,
Strange the way we have to keep repeating things we've known for 235 years really.
But is it that strange? Laziness is a basic human vice. It's why scams of all kinds are so successful. Prudent mothers bring up their offspring with the wise words;
If it sounds too good to be true, it isn't
...ringing in their ears, but the likes of Bernie Madoff still find their victims easily enough. Most people are all too keen to believe in "money for nothing" and possibly even "your chicks for free." Yet the report is clear (if dry) enough;
...a one unit change in the initial level of economic freedom between two countries (on a scale of 1 to 10) is associated with an almost 1 percentage point differential in their average long-run economic growth rates. In the case of civil and political liberties, the long-term effect is also positive and significant with a differential of 0.3 percentage point.
In addition to the initial conditions, the expansion of freedom conditions over time (economic, civil, and political) also positively influences long-run economic growth. In contrast, no evidence was found that the initial level of entitlement rights or their change over time had any significant effects on long-term per capita income, except for a negative effect in some specifications of the model. These results tend to support earlier findings that beyond core functions of government responsibility—including the protection of liberty itself—the expansion of the state to provide for various entitlements, including so-called economic, social, and cultural rights, may not make people richer in the long run and may even make them poorer...
Many of us prefer politics to economics because the former is more fun and less work. Angela Merkel even asserted the primacy of politics over economics as a moral imperative. That is just as stupid as saying that justice is more important than medicine, so sick people can't die because that wouldn't be fair. Socialism is simply, in every sense of the word, lazy thinking. For so long as any tentative acknowledgement of economic reality is regarded as cruel, then we may as well get used to "the lowest barbarism" Adam Smith explained was so simple (if not easy) to avoid. Of course it's one thing to inflict it on ourselves, but quite another to force it on the Third World as a consequence of our so-called "aid."