>> and now to london for prime minister's question time, live from the british house of commons. every wednesday while parliament is in session prime minister david cameron takes questions from the members of the house of commons. prior to question time the house is wrapping up of the business. this is live coverage on c-spa c-span2.

>> could she indicate to the house what discussion she had with the government and the republic of ireland around these issues ahead of any possible discussion? >> i had regular discussions about this matter, including a number of meetings both in northern ireland and in dublin. we are keen to work together to encourage a report to be found, to encourage the political parties in northern ireland to reconcile their differences. >> on question 10. >> thank you very much, mr. speaker. does she agree with me, and i welcome her very -- much has been achieved and we should now proceed to element as much as possible reading the legislation and resolving the differences that are there?

>> i agree that considerable progress has been achieved. these issues are divisive and the fact all five political parties found a degree of common ground on these matters is very welcome. i agree we should keep up the momentum, seize the opportunity to try to get an agreement over the line and reconcile the differences which still exist between the five parties. >> border. questions to the prime minister. >> thank you, mr. speaker. this morning i had meetings with ministerial colleagues and others, and in addition to my duties in this house, i shall have further such meetings later today. >> thank you, mr. speaker. launched last week, action on sugar aimed to reduce the sugar content of food and drink by up to 30% because of the twin epidemic of type ii diabetes. volunteer arrangements with manufactures are

well-intentioned have not work. will the prime minister meet with a delegation of health experts to discuss this issue? can we get his support in the war on sugar by asking him to give up sugar and sugary drinks for one day this week? >> i'm sure the last proposal will have the strongest support of mrs. kimmitt so i will take that up if i possibly can. can i first of all commend the honorable gentleman for raising this issue, for speaking out on issues of diabetes and obesity with such consistency because they are major health concerns for our country. we're taking them very certainly. we are rolling out the nhs health check program to identify all those between 40-74 at risk of diabetes. childhood obesity rates are falling but there is more that needs to be done. i'm happy to facilitate discussions between him and my right honorable friend, the health secretary, to have good discussions we want. we take this seriously. we think the responsibility deal has achieved great things but

there's more to be done. >> mr. speaker, last week i had the honor of opening the new network rail regional operating center at three bridges in my constituency. >> here, here. >> can my right honorable friend and say what investment this government is putting into the existing rail network to help commuters and travelers over and long-term economic plan? >> my honorable friend is right. investing in infrastructure is a key part of our long-term economic plan to make sure that britain's economy can be a success now and the future. we have seen major investment in the southeast, all delivering new services and i can tell him that between 2015 and 2020 were planning to invest over 56 billion on roads, rail and local transport. and it's important that it is three times as much as the plane

investment in hs2. so to those who fear that a just to will take all the investment enabled. three times as much will be spent elsewhere. >> ed miliband. [shouting] >> mr. speaker, rbs are expected to ask the government to approve bonuses over 100% on -- does the prime minister think that's acceptable? >> what i can tell the children about rbs is will continue with their plans for rbs that seem bonuses come down by 85%, that it's in the bonus ball at one-third of the level that it was under labour, and i can confirm today that just as we've had limits on cash bonuses of 2000 pounds of rbs, issued an last year, we will do the same next year as well. >> mr. speaker, i think we can all agree with this general sentiment, but today i am asking

for specific question. rbs are talking to parts of the government about the proposal debate over 100% bonuses. he is the prime minister. the taxpayer will foot the bill. will he put a stop to it right now by telling rbs to drop this idea? >> i'll tell him exactly what we are saying to rbs and it is this. if there are any proposals to increasincrease the overall prat his pay and bonus bill at rbs, at the investment bank him any proposals for that, we will be doing. what a pity the party government never took an approach like that. [shouting] >> mr. speaker -- mr. speaker, mr. speaker -- >> however long it takes. the questions will be heard and the answers will be heard. mr. ed miliband. >> mr. speaker, on not asking

about increases in pay our bonuses. i'm asking a very simple question. i'm asking a very simple question about the proposal that is expected to come forward from rbs which is to pay more than 100% bonuses on day. now we know when rbs is making a law, when they themselves say they have been -- these kind of bonuses are a risky one way bet, we know it shouldn't be allowed to happen. mr. speaker, when ordinary firms are facing a cost-of-living crisis, surely he can say that the people under 1 million -- earning a million pounds, a bonus of 1 million should be quite enough. >> it is not asking about the overall pay and bonuses at rbs what on earth is in the? that's what he should be asking about. and what i've said very clearly is that the remuneration, for total pay bill, at that investment bank must come down. i have to say, mr. speaker, to get a lecture from the right honorable gentleman wind we had

from them the biggest bust anywhere in the world at rbs can read 125% mortgages at northern rock, we had all the embarrassment about fred goodwin. he comes here every week, he comes here every week to complain about a problem created by the labour party. last week it was betting. this week it's banking. he rises up with all the authority, moral authority of reference flowers -- [laughter] where's the apology for the mess they made of rbs in the first place lacks. [shouting] >> the last two years my counsel opportunity sudden growth and has greater 370 million pounds worth of investment. youth unemployment has seen record --

[inaudible] given that life sciences barred engines for growth, was support with the government give to realize our plan of a life-size cluster based around these world-renowned centers of excellence? >> i think my right honorable friend makes a very good point about the strength that sutton has. obviously, we've got the box to attract life science businesses to britain. would also got the investment in apprenticeships. that is important. and, of course, the office of life science as he knows bring the business department help the apartment together to help bring life sciences jobs here, working with local enterprise partnerships i think there's a great opportunity for more investment in these important businesses. >> the market dawkins inquest concluded last week with a verdict of unlawful killing but it also found errors in the police investigation. last week also saw wallis admitting he lied about the right honorable member.

does the prime minister except it is the urgent that we reform the independent police complaints commission for? >> first of all can recommend what he said about the importance of people respecting the outcome of the inquest. we have proper legal process in this country and we should respect their outcomes. he also knows they're still an ongoing independent police complaints investigation into the case and we shall let it do its work. i'm always prepared to look at reforms of organizations like this. there was a big reform some years ago to make the ipcc much more independent. he shaking his head and think it is a working. very happy to look at argument. i have to say in issue of pc walls this was shocking to see an e-mail that purported to be someone who witnessed and if it and you're told it's a member of the public and it turns out it's a serving police officer that was deeply troubling and deeply disturbing. am not saying all is well. i think the vast majority of the

british police service to a magnificent job. they put -- they put their lives on the line for us day after day. i'm happy to look at proposals to how we can strengthen this arrangement. [inaudible] >> i'm grateful for what my honorable friend says. i think we have seen the regionareachable growth fund pre some real economic success stories and that is being combined with our long-term economic plan to encourage businesses to take on employees, to put in place the infrastructure. and as he says quite

importantly, to back exports in terms of britain's performance and get out there and sell to the world. >> thank you, mr. speaker. given that we've recently had reports that half a dozen terror suspects could soon be released onto our streets, can the prime minister give an assurance the public safety will not be compromised once the government experiment with terrorism controls expires? >> what i can assure and the house is we will always take every step necessary to keep the british public safety i think the measures are working well. it's a complete myth to pretend that control orders would be kept in place forever. many, many people were taken off control orders during the resistance of that set of measures. and all of the time i listen very carefully to the head of the metropolitan police service and to the heads of the security service were involved in drug of these measures and who advises on how best to keep our country

safe. >> in the first six months of last year, we benefited from the highest number of business startups in our history. the unemployed claimant count is down to 2.5%. will the prime minister join me in praising the entrepreneurial spirit and also redouble governments efforts through ukip to have more grocery firms to export? >> my honorable friend is right. we are seeing an enterprise revolution in our country again, 400,000 more businesses in existence today compared to 2010. i think the point he makes about small businesses and export is particularly important are currently one in five is an export. if we can turn it into one in four we would wipe out our trade deficit so i support excellent work he does to call to account encourage them to do everything they can to back britain's entrepreneurs. >> ed miliband. [shouting]

>> mr. speaker, there are five all over the country with capacity recorder of a million -- two and 50,000 houses when nothing is happening. some of them -- some of them being hoarded by developers. i'm in favor of giving power to developers to hold land without building on it, use it or lose it to the prime minister said the policy was enough. does he still believe that? >> which is a demonstration -- no one do we edit banks collapsing and all the rest of it. what i would say to the honorable gentleman is that house building is picking up. we're seeing a big increase in housing starts but a big increase in housing completion. why i think his policy as a comment put the nuts is this reason that is if you say to developers and companies we're going to confiscate land and lets you build, they will not go

ahead with the building in the first place. his approach is to put a freeze on the whole on development rather than get britain building which is what we need to have happen. >> the prime minister is incredibly complacent. how complacent, how complacent at the lowest level since 1924. i'm interested in what he says about the policy because his own housing minister says the policy might make a contribution. the mayor of london says we should be able to have a use it or lose a close. developer should be under no illusion that they can sit on their land and wait for prices to go up. so is the policy nuts or is it the right thing to do? >> what we need to keep going with is the policies of this government is saying the house building increased. i know he doesn't like the fact, nearly 400,000 new homes delivered since 2010. housing starts in the last quarter were the highest level for five years.

89%-the trough in 2009 when he was sitting in the cabinet. 16% increase in housing starts over the last 12 month compared with the year before. here's the question he needs to answer. is a shadow ministers goal round of posing are planning reform even though they are important to get britain building, it time and again they are criticizing proposals like help divided that are helping our better countrymen and women realize the dream of homeownership. here's one for him. if he cares about house building and homeownership, why not make -- get on with hard-working people? >> mr. speaker, in labour council there are five -- far more housing than in tora council. his housing measures as he supported to the mayor of hans stacey supports. he doesn't know what he thinks. here's the reality. he is not doing enough to close

the gap between supply and demand. the truth is a number of social housing starts is down. he shelved his plan for new and rents are rising because except that britain is building 100,000 fewer homes so we need to meet demand a? >> of course we need to build new homes. that's why we are of reform the planning system which they oppose. that's what we've got help divided which they oppose. that's why we are helping in all the ways to get britain building. what we are seeing, tried to is he is now having to jump around all over the place. it started off with the deficit reduction wasn't going to work. now he can make that argument. and it was we needed plan b. he can make that argument. next the cost of living but yesterday we saw inflation fall to 2%. what we see as a government that's got a long-term economic plan and an opposition that hasn't got a clue.

[shouting] >> can i welcome the government youth commitment that my local community is benefiting of the potential of shale gas? can encourage the prime minister to do more to british companies and the scientific careers to do more -- [inaudible] legitimate concerns that both technology and the potential incremental impact? >> i think my honorable friend is absolutely right to raise this and to make the remarks that he does. i think that shale has a huge potential for our country. figures ar on that it would recovered just 7% of the reserves, that would provide us with gas in this country for 30 years. we've clearly got to do a far better job at explaining and working with communities about the benefits and also talking frankly about the process. i think there's a huge amount of myths that are being put round en route to frighten people about shale gas extraction whereas we can see into united

states they can be extracted safely and cleanly, providing effective low-cost energy, green energy for our homes and for a businesses and make our country more competitive at the same time. >> as you said it, -- [inaudible] will the prime minister agreed to meet with me and other representatives of the south to discuss this issue to see if we can get these paratroopers and released from prison? >> i know how important this issue is and i raised it personally with indian government ministers when i was recently in india. i discussed it with a foreign secretary. i'll go on making sure we do everything that we can pick up a meeting needs to be arranged between members of this house of commons representing the constituents and ugly the foreign secretary represents one of these constituents itself, i'm very happy to arrange that.

>> investing in research and innovation is essential for our economic future. does the prime minister agreed the open university use smart research project to improve infrastructure and just one example of how -- leading the way for our long-term economic plan? >> i visited the open university. it's extremely impressive organization i but it's also leading a very important export drive in terms of our universities i congratulate them for the representation on the forum and for the open university is doing but i think there are many opportunities for milton keynes, not least provided by a just as well and i look forward to discussing it with them in the future. [inaudible] can't afford to go to work. all because their wages are not going far enough. will the prime minister find except the cost of living is

stretching families to breaking point? >> i except we are still recovering from the great recession that took 3000 pounds out of the typical family's income. but what we're seeing now is more people in work including in wales if we are seeing real wages now starting to rise. i think we can be confident yes, it's difficult, yes, it's still hard work but our economy has grown and we want that to be a recovery for everyone in our country. >> the number of people in receipt of the jobseeker's allowance fell 31% between november 2012 and november 2013. youth unemployment fell by even more impressive 40%. does the prime minister share my view that the government's long-term plan is already giving employers the confidence to get hiring again and? >> i'm grateful for what my honorable friend says because absolutely key part of a long-term economic plan is to see a growing number of people in work in our country.

usage 1.2 million more people in work. private sector employment is up 64,000. they're still further to go, particularly in the west a lens where we need to get particularly young people back to work with the figures in his own constituency are very encouraging. >> on his inquiry, instead of ordering civil servant to investigate, why doesn't the prime minister just ask lord jeffrey what they agreed with margaret thatcher? and whether that anything to do with the west and helicopter deal at the time? >> i for the audible children might have gone to conspiracy theory too far on this one. look, it is very important that we get to the bottom of what happened and that is what i've asked the cabinet secretary to review this review. able establish the facts, the process is underway. i want it to be fast, find out

the truth and the findings will be made public. i remember and will never forget my own visit to the golden temple, one of the most beautiful and serene places anywhere on this planet. what happened 30 years ago led to a tragic loss of life but it remains a source of deep pain. prime minister's were right to apologize. i understand the concerns of these papers raise. so let's wait for the outcome of the review by sir jeremy heywood. i would note that so far it is not found any evidence to contradict the insistence by indian commanders responsible at the time, that the responsibly for this was planned and carried out solely by the indian army. i think it is important to put that but we do need an inquiry so we can get to the bottom of this. >> thank you, mr. speaker. on the 30th agenda i will be hosting a skills affair for 70 businesses.

[inaudible] with the prime minister give his support to this event envoy to confirm that he will remain at his government will remain committed to training an upscale the young so that they can benefit personally? >> for sock and i commend my honorable friend for what he is carrying out in carlo. i think these jobs there is and skills there's an encouraging young people to think about up and ships and encouraging businesses to train people and apprenticeships are some of the most important things that we can do. we have 1.5 the apprentices start since the election to over 250,000 apprenticeships have started in the northwest under this government including in his constituency and we must keep up the good work. >> thank you, mr. speaker. the prime minister will be unaware of the great concern among british sikhs about the reports in recent days of uk involvement in operation blue

start on the temple. he will also be aware that the broader events of 1984 in india resulted in the death of thousands of innocent sikhs. and that this has led to lasting presenting in the sikhs committee in the uk and around the world. this is an open wound which will not heal until -- [inaudible] cannot ask him on the process he is set up whether he will ensure that full disclosure of all government papers and information -- and that there is also following that a proper statement in this house where ministers can be questioned? >> i think, first of all cannot be with hi them about the deep scars that this event left and and quickly strong feelings that exist to this day but as i say anyone who visits the golden temple and sees what an extraordinary place, piece and tranquility and what an important site it is knows how powerful this point is.

we are going to make sure this inquiry is held properly. its findings will be made public which i think is vitally important to as i say come in the end i don't think anyone should take away the responsibility for these events with the people who are properly responsible for them, and i'm sure the inquiry will find that. in terms of holding a statement in revealing this information and the findings to the house, i will listen carefull carefully s is but a think a statement might well be the right approach. >> would've prime minister speak to his colleagues about the funding resulting from intense of fracking? so those committees have filled the impact of fracking are those who choose how that money is spent rather than having to compete with the district and county councils other priorities and? >> i think my honorable friend makes an important point. what we set out is the overall level of financial support, the 100,000 pounds when it will is dug, up to 10 million pounds theoretically because of the 1%

of revenue it will be paid and then it's of vital about 100% retention of business rates which could have a significant affect for local government finance. at a point she makes is how do you divide it up between parishes, districts and counties and also do look at individual payments to individual households who might be inconvenienced? i think we should look at very local options and making sure that parishes and individual people will benefit. i think it's something that colleagues will want to discuss and think about so we can really get this right and help us industry to take off. >> i'm not sure if members are aware that anyone joining the police force will now have to pay 1000 pounds for certificate before the even fill in the application form. 1000 pounds of the tax will make it harder for the police to look like the committee that it serves and i represent. it will put off, put young people from poor backgrounds and ethnic minorities from joining the police. we all know the prime minister

admires characters like harry fleischman, but -- [inaudible] in 1871. why is it being introduced for the police in the 21st century? >> listen very carefully to what the honorable lady says but what we're trying to do through the college of policing is to even further professionalize this vital profession but i'll make sure the home secretary contacts are about this particular issue. >> what's the point of anyone clinging onto a plan being when plan a is so obviously working? [shouting] >> it's not just -- it's not just plan b we're not hearing about anymore. anymore. they seem to have stopped on but the cost of living. they stopped the one about the deficit wouldn't come down. remember when they told us growth would never come? they told us we were going to

lose 1 million jobs we've gained and then jobs. but the biggest transformation of all is the silence of the shadow chancellor. [shouting] they've got this big -- this big debate. there's a big debate today on banking but he wasn't allowed on the radio. he won't be speaking in the house of commons. they've got another idea. you hide your shadow chancellor by leaving them on the front bench. [shouting] >> the prime minister has previously shown considerable leadership in apologizing the victims of violence in northern ireland. unfortunately, those victims of paramilitary violence that made up the majority of victims have not accept such an apology. does the prime minister a great that they have proposal -- offered the best opportunity for victims and survivors to receive truth and justice? and will he commit as the prime minister the backing of

proposals, helping by cooperating and also by funding this proposal? >> what i would say is i think there's a lot of merit in the proposal. i think he did some excellent work. i noted that peter robinson, the first minister of northern ireland described them as providing the architecture for future agreement and discussions i hope he can take the haas work, click the difficult work done on the past and take that forward with all sides trying to agree. >> thank you, mr. speaker. i'm not sure if the prime minister is a follower of channel four but if he is, he will know that sadly -- [inaudible] does he agree with me that as part of our long-term economic plan we make sure the benefit system is there for people who needed? need it? it isn't a lifestyle choice and people don't get trapped in it? >> i've only managed to catch a small amount of this program but i think it brings home two vital points but when his we need a

welfare system that is tailored to make sure work always pays but there is a second point which is many people in our country have multiple disadvantages and problems where you need help to help get people out of that poverty and benefit dependency so it's not just about tailoring a benefit system to make work pay, it's making sure we intervene in people's lives and tried to correct the things that are keeping them out of work and earning a decent living. >> may i say to the prime minister as someone who strongly supports shale gas extraction by fracking, that however well intentioned his current package will not assuage local committees to honor cross party basis -- [inaudible] why and he and the chance of not sit down with across party local government association and negotiate with them on their proposal as in other countries, 10% of revenues to be shared

with local communities? >> i thought the proposal from some members was a should be 10% of profits. my point is actually 1% of revenues which start running the moment that shale starts coming out of the ground could will be a better offer. look, i'm happy to sit there with anybody and discussed this issue because i think shale is so important for the future of our country. the point i would make having been deceived yesterday -- sorry, on monday, the oil platforms that are already there on the border, it is worth making the point that those went ahead without any sort of community benefits that we are promising with the shale, 100,000 pounds when a will is doug before any gas has reached the surface. 1% of revenues which could be seven to 10 million pounds for a typical fracking well. and then 100% retention of business rates which for a set of wells could be 1.7 million, maybe 2 million pounds for local authority. honorable members should think

about how much council tax a small digital medical authority raises and consider how much 1.7 to 2 million pounds of revenue into that order, difference that could make. by all means let's talk about the facts and figures and what we can do, but we also need to persuade people that this can go ahead without the environmental damage, without the problems that people are worried about. i think those are the concerns more than anything. >> the leader of the opposition have said -- i want to do in britain. [laughter] given recent events across the channel, does my right on the front that we would me that this is completely at odds with our long-term economic plan? >> i didn't -- i didn't catch all of the presidents press covers just because i was appearing in front of the liaison committee.

one that i did notice is that the french proposals and now are to cut spending in order to cut taxes in order to make the economy more competitive. now, perhaps the shadow chancellor and his new sonnet form will want to consider some of these ideas and recognize that this revolution of making business more competitive, trying to win in the global race, that's a proper plan for the economy. [shouting] >> order. >> here on c-span2 we will leave the british house of commons now as they move onto other legislative business. you've been watching prime minister's question time and lies wednesdays at 7 a.m. eastern while parliament is in session. you can see this weeks question time again sunday night at nine eastern and pacific on c-span. >> for more information go to c-span.org, click on c-span series for prime minister's questions plus links to international news media and

legislatures around the world. you can watch recent video including programs given with other international issues. >> i think i just had -- told it when someone has their own agenda and not ronnie. and then i would tell them, he would always agree with with me but i would tell them. it usually worked out. >> watch a program on first lady nancy reagan at our website c-span.org/firstladies, or see it saturday on c-span at 7 p.m. eastern. our series continues live money as a look at first lady arber bush. -- live monday. >> a report by the heritage foundation and "the wall street journal" has the nice kids dropping out of the top 10 countries on its economic

freedom index. senator rand paul was at the heritage foundation to discuss the report. he is followed by a panel that discusses a range of policy issues including taxation, trade, and government regulations. this is an hour and a half. >> good morning, everyone. it is my great pleasure to welcome you here to the official release of the 2014 index of economic freedom. i want to recognize our friends on representing nations from around the globe. those from capitol hill and the "washington post" and research community, and let me recognize the press corps certainly appreciate all of you being here. thank you to our friends at "the wall street journal" for their involvement, including economists an editorial board member stephen moore who is here with us today, leading the fight

for economic freedom here in this country and around the world. i also want to recognize the many scholars here at the heritage foundation who have worked so hard on this index this year and many years before. that includes dr. kim hong, founding editor of the index of economic freedom, and also he is a distinguished fellow with the foundation. thank you for your vision and leadership. i'm also thanks to dr. jim care father, vice president of foreign and defense policy, and has been essential to the success of this index. also want to thank ambassador terry miller, senior policy analyst, and so many others who have worked on this project. while it's the first such index that i've had the honor to introduce, we mark today a very special occasion. this is the 20th anniversary of the index.

back in the 1980s, nobel laureate milton friedman first suggested the need for international metric of economic liberty, a measuring stick for future prosperity across the globe. and as i look at this index and read through it, and i would encourage you to look at the whole thing, it is a great book on economics. but i can't help but see the parallels between this index and economic freedom in general and some of the work i did in my previous life on quality management, a quality drink some of you may not know that an american years ago, went to japan like in the 1960s inaction was a key part of an economic revolution in making japan one of the power economic countries in the world. and he did that through this concept of total quality management. it's not something that's talked about a lot in washington for

various reasons. the one of the things we used to say when we trained companies to do with quality was you can't improve what you don't measure. it's a key part of this index. it's a key part of creating quality at the company level. but he helped to change the focus in companies and eventually the whole country of japan by focusing on not measuring inputs but measuring output. and to look at the whole process of production and understanding all the factors that create quality, but also at the same time he found as you seek to improve quality, you lowered price, you create efficiencies and actually improve morel. the secret of quality production was pushing decision-making down to the people of -- doing the production. the parallel between companies producing quality and countries is very obvious.

that it is freedom itself that creates economic growth around the world. that's the whole point of economic freedom. it's not just economic freedom in itself, but what it does to improve the quality of life of people, to raise up economies all over the world. and we've seen that since this index was being produced in 1995 the heritage foundation published the first index, and it is remain one of the most influential -- is interesting to see companies in countries come here to the heritage foundation abdicate for things they are doing to move them up the economic index latter, because it's so important for the economic development in attracting businesses to locate. i want to thank "the wall street journal" for its partnership and the brilliant scholars here at

heritage. it's our most important annual study. our enthusiasm for this landmark anniversary is tempered with some sobering implications that this index deals. in the past several years increased regulation in the financial and health care sectors, the degradation of property rights and massive growth in the size and scope of government have all contributed to the united states, unfortunate but foreseeable slide in his freedom rating. of the 178 economies downgraded by the index, ours is the only one to have been rated less and less free for the past seven consecutive years. it should stun everyone. the first time the u.s. has fallen out of the top 10, we come in right behind estonia. we continue to be related mostly

free, but we are not in the free category anymore. can you imagine if our secretary of defense announced that we were mostly strong, or kind of strong as a nation? i don't think we would sit still for that as a nation. fortunately despaired will never be part of what we do here at the heritage foundation. we are continuing to work on those factors, those inputs that change the total output of economic growth. but we cannot help but notice the correlation between our economic freedom and the lack of economic opportunity, the growth of unemployment, the lack of participation in the workforce. this makes a very real difference. and we see that all over the world, but it's interesting to see those on capitol hill and

the white house talking about income inequality and unemployment and the need to create more opportunity, while not recognizing the factors that make that happen. that's what we're here for. i have the great pleasure to introduce one of the i think the greatest advocates for freedom their country today. i endorsed him in the senate race that was somewhat controversial two years ago. but i have to say it was one of the best decisions i've ever made. because rand paul is an advocate for those principles of freedom that are so important to improve the quality of life for people here and around the world. and it is my great pleasure to introduce senator rand paul to you today. [applause] >> thank you. i wish we are here under better circumstances. if you like your freedom you can

keep it. or maybe not. this year the united states slips in the world ranking for economic freedom. why? because economic freedom is inversely proportional to the size of your government. government continues to grow at an alarming pace. why is economic freedom important? is a somethin something abstrac? isn't just an abstraction that which is want to debate in philosophical societies? i would say no. it's important because 11 when people are out of work in our country. we have the highest corporate income tax in the world. we just raise the personal income tax. we tax our entire economy nearly $3 trillion, regulatory cost is nearly $2 trillion we keep adding to it. we have over 200 regulations added every year that caused the economy over $100 million each. to make matters worse these regulations which often, one

revelation can cost over $100 million, we pass these regulations not by congress, not by vote of the senate or the house, but these regulations are largely written by unelected bureaucrats. a government takeover of health care is a significant loss of freedom. in fact, i would argue that obamacare involves the largest loss of freedom of choice in 50 years. not only are you prevented from keeping your doctor if you like them, you are also prevented from choosing your insurance plan. it may well be the biggest lie of the century that if you like your doctor you can keep him or her. this has never been about, just about an efficient distribution or what is the most efficient distribution, it's about freedom of choice. you have given up your freedom. yet given up your freedom to choose your insurance company your freedom to choose your doctor. all had to do is get on the obama to website and realize you have four choices now. but it's not just about health

care. it's lightbulbs. its toilets. its cars. you name it, your freedom of choice is gone. for a party who says they are the pro-choice party, this is the most anti-choice administration we've seen in a lifetime. in fact with obamacare i was in a government now is limiting your choices, your freedoms in about 16 of the economy. limiting freedom also limits your prosperity. a smaller percentage of adults, a smaller percentage of adults now worse than ever before have been in our economy. if we want america to prosper again, we must reflect upon why we continue to fall in the economic freedom index. until we understand that freedom and prosperity go hand-in-hand, our future remains clouded. our kids need were if america will continue to be the land of

the free and the economic engine of the world. i thank heritage for doing this great service and doing this economic freedom index. i hope to come back next year under better circumstances where we're going up the freedom index and not down. thank you very much. [applause] >> thank you very much. i would like to invite our panelists to join us on stage. hosting the panel is dr. kim holmes, a distinguished fellow at the institute for international studies here at the heritage foundation. he praises serve as the vice president for foreign and defense policy studies and director of the davis institute for international studies. he is the founding editor of the "index of economic freedom." from 2002-2005 he served in the george w. bush administration as

assistant secretary of state for international organization for this. widely recognized as america's leading conservative, one of america's leading conservative voices in national security policy. is also the author of rebound, getting america back to greatness. >> thank you. good morning, everybody. welcome to the heritage foundation. i would like to certainly thank senator demint and paul for getting us off to a good start. very glad they could be here. this is a special day for me. senator demint mentioned i was here 20 years ago when we first started the index. i'm looking at all the covers of the index. one, 1995 on the top left corner, knowledge and design i think has improved over the years but i think also the content has certainly gotten more sophisticated and better as the years have passed. it's a special day for me to be here. there is an essay by the way, on the front, an essay that i've

written about the 20 years history of the index that goes into why we founded it 20 years ago. there are a lot of people involved, talked about creating an index. and why we did and what we are trying to achieve and how it's changed over the years. you might find it interesting if you take a look at that. my job here is essentially to say a few words about what's in the index this year in 2014 edition but also to introduce our distinguished panelists, get a discussion going and then hopefully we'll have a time for you to a discussion. i'd like to thank some people. certainly like to think that the editors of the index, ambassador terry miller and anthony kim who did most of the work, for a job well done. they split the details and they have done everything in the power to make sure they got the details right. i greatly appreciate that as i know my colleagues at heritage do. i would also like to think the editing production, marketing

staffs of heritage. they did such an excellent job. and not only producing the index for making sure folks like you actually see it and get to know about it so it's just not lost in the back room somewhere and finally i would like senator demint, thank "the wall street journal." they that are partner now for most of our 20 years. i think 18 years total. their input and insights are key to making the index a success and we're so glad to have them with us here today. before we get into -- let's get onto my lunch. already, the most important finding of the index is actually already been alluded to. and that's the united states has dropped out of the top rate, 10 freest economies in the world. it's now the 12th freest economy in the world and its in the second tier category called a mostly free. it's not among the top 10 freest economies anymore. the reasons for it were mentioned both by senator demint and senator paul but i

think the most disturbing thing about this year's u.s. escort is that it's the seventh straight year in a row. that means we are certainly well into a trend, and this matters for a couple of reasons. the most obvious one is that the things that were making -- the many centuries that its dedication to economic freedom and the free market system, as the best engine of economic growth and also, frankly, the best way to ensure that all americans whether they are rich or poor get a higher standard of living, that formula has eroded. it's eroding at well-established and a trend. but america's declining scores also is an indicator of something else, and that is that all over the world america -- people around the world got used to america's being a leader in economic freedom. there was in the 1990s as a

matter of fact, for those who follow foreign aid, and other issues, something called a washington consensus. this is when president clinton was president. the washington consensus have a dedication to free markets all over the world. they don't call it the washington consensus anymore, for very, very good reasons. the fact that this is particularly disturbing because as the u.s. escort is going down, global economic freedom is going up. the global average score in 2014 is the highest average in the 20 history of the index. so this essentially is showing that we are no longer the model, but others are the model for what makes countries economies prosper. we are as you will see if you look at the index in detail, we are now i think in the category of declining countries that include greece, italy, spain and

others come and countries that are going up our countries like sweden, australia, singapore, germany. and so this is not a good trend to be an. this is not the best place for us to be. now, in terms of the overall findings, the world is doing better in some areas and worse in others. if you look at all the global scores, the world is doing best in investment freedom which measures banking regulations and also the ease and degree to which private investment both internally is made as follows across borders. but worldwide it's doing worse, just a little worse in protecting property rights, and generally the whole problems are the rule of law. this is a perennial problem, whether you're developing or non-developing country, and that is the problem of corruption and the rule of law is something that is still the problem across the globe and, frankly, as you see in the declining scores for the united states it's also a problem that is returning here.

as we find that there are efforts by this administration to bend the rule of law and of course with more regulations on the economy this creates more opportunities for these rules to be bent and for the free markets to be infringed upon. interestingly, asia and sub-saharan africa are doing well. and economic freedom. in fact, economic freedom is on the rise all over the world except for two places, and that is to region, and one is north america and the reason america's decline is because, you guessed it, because the u.s. escort is declining. but is also lagging behind in the middle east and on north africa as well. hong kong remains number one, the 20th year in a row, the freest economy in the world which is really a remarkable achievement getting all that's happened in hong kong over the years.

the freest economies are singapore, australia, switzerland, new zealand, in canada. the highest ranking so-called developing economies on the index our chili come which is number seven, in the top 10 they are now both of these countries are not in the top 10 and hopefully by not being part of the so-called west they can be a model for others to show that the form of economic freedom knows no boundaries, knows no particular civilization or even culture, knows no race but it simply is an idea that works when human beings are involved in the charge of the economy. so it's a universal principle that applies across the world. another notable default action was in europe. it was a realignment going on in europe which i think people who follow the european economy knows very well but it's not widely known, economic freedom is advancing in 18 countries in europe.

that includes, i will mention all of them. it's a long number but it includes germany, sweden, lithuania, georgia, austria, the czech republic and norway, just to mention a few. but sadly economic freedom is declining in europe as well, and most particular decline in france and decline in the united kingdom which is particularly disturbing given the fact that there is supposed to be a free market, pro-free market, in charge in the united kingdom. finally, the so-called -- are moving backwards. brazil plunged 14 places to 114th, and is now judged as being among the mostly unfree country of the index. so those are the main findings. i just want to hit the top ones. there's a lot in there and now i would like to sort of move to the discussion, get the reactions of our panelists. i'm just going to introduce all three of them, get it over with and to can come up one after the

other. the first speaker will be derek morgan. is the vice president for domestic and economic policy here at heritage. is one of the nations most respected, public policy research is in domestic issues. he was promoted to his post in 2012 after being two years as chief of staff at heritage. he was a policy expert at the republican policy committee and before that he worked for four years as staff secretary to vice president richard cheney. next is stephen moore, editorial board member and senior economics writer for "the wall street journal." he was previously known as the founder and former president of -- over the years he has served as a senior economist on the congressional joint economic committee, but also many years ago as a budget expert both here

at heritage and decade. glad to have you here. and, finally, bryan riley is a senior research analyst at heritage working on trade issues. he was one of the many experts that was can shooting to the economic research of the index, and so he is probably -- i know he is very well versed in all the details. so if we get into some of the specific countries course i'm sure he would be happy to answer your questions. so without further ado i would just ask derrick to come on up and then we were giggling. thank you very much. [applause] thank you, kim, for the introduction to i want you all to imagine that you go back in time to 1995. it was a heady time for economic freedom. the evil empire had just collapsed. now politically free, some of these former comments countries were eager for a free economy as well. which he believed that just

about 20 years later, estonia would rank ahead of the united states in economic freedom? that's not a knock on estonia at all. indeed, they should be congratulated. unfortunately, a stone has surpassed the united states not only because they improved but also because we have faltered. the index of economic freedom has for 20 years been an annual checkup of sorts for the united states, and more than 175 countries around the world are we get to compare ourselves to allies, competitors and adversaries and the like. we get to see their progress and hours in the march for freedom. the 2014 index rankings should serve as a wakeup call to u.s. policymakers and citizens alike. we all owe a debt of gratitude to "the wall street journal" and the primary authors at heritage, ambassador terry miller, dr. kim homes and anthony kim. in fact, i think our president would be rise to review the

science prior to the state of union address this month. the report finishes index is sobering indeed. we have now dropped in score as you heard seven years in a row, the only country to do so. we are now out of the top 10. our fiscal freedom, that is our tax rate, tax competitiveness, we are now ranks 154th in the world. our government spending is an abysmal 137th in the world. these two factors are really our achilles' heel. in the past year we've seen tax increases from the obamacare legislation, and an expiration of some of the bush tax cuts as part of the so-called fiscal cliff deal. these tax increases on everything from payrolls to that, investment and marginal tax rates make us less competitive internationally, and it appears that some are not content with these tax increases and are arguing for even more. we've also seen the failure in

spending restraints. the so-called quest was not a perfect policy by any means, but it was a way to force congress to restrain spending growth. with the recent budget agreement, it looks like congress is back to its old game of increasing spending in the short term with promises of cuts later on that never seemed to materialize. ..