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generated by the economic policies of former president Ronald Reagan; Clinton promised a
better deal for Americans who "work hard and play by the rules." Similar ideas were touted
by Democratic candidates during the congressional campaign of 2006.

In making the case that American workers suffer from growing inequality, the critics cite
statistics that place the average earnings for a corporate chief executive officer (CEO) at
475 times that of the average worker, compared with a differential of 40-1 during the
1960s. The disparity is especially glaring when compared with CEO compensation in
Japan, where the differential is 11-1, or in Britain, where the differential is 22-1. Others
point to the decades-long stagnation in U.S. wages and, some say, the creation of a two-
tiered economy in which many jobs are held by illegal immigrants.

Compared with other developed democracies, the United States indeed has a mixed
record. There is more absolute poverty in the United States than in the countries of
Western Europe. At the same time, the United States has a higher proportion of
immigrants from poor countries than does Europe, and has by most accounts done a
better job of integrating the new immigrants into the country's social and economic fabric.
The United States has a lower minimum wage than do most European countries and differs
from Europe in its willingness to tolerate a substantial class of low-wage workers. But the
United States has a lower rate of unemployment than do most countries in Europe, some
of which have suffered jobless rates of 10 percent or more for many years.

This study examines the condition of freedom in America. Certainly equality of opportunity
is essential to freedom, both as a value and as a factor that affects the functioning of a free
country. As has been seen in Russia and in some Latin American countries, people lose
faith in democracy under conditions of massive poverty, huge gaps between rich and poor,
rampant corruption, and economic volatility.

At the same time, in an economically stable liberal democracy, the degree of freedom does
not neatly correlate with the gains and losses in the stock market, the unemployment rate,
the rate of inflation, interest rates, or other broad indicators of economic performance. Is it
a violation of Americans' rights and freedoms that Wal-Mart pays many of its workers less
than $10 an hour without medical insurance? Some would argue that the Wal-Mart
phenomenon, whereby large, powerful corporations maintain their competitive advantage
through the exploitation of low-wage workers, does represent an abuse of power and a
violation of rights. Others would maintain that Wal-Mart's labor policies are a function of
market forces and are less a violation of rights--since they do not reflect national economic
policy--than France's rigid labor code, which contributes to a high unemployment rate and
erects barriers to the career prospects of hundreds of thousands of young people.

However, other economic issues bear more directly on the freedoms enjoyed by individual
Americans. One such issue is the right of workers to enjoy trade-union representation. In
the United States, the great movement of the working class into middle-class status
coincided with the period of trade unionism's greatest success. Conversely, the period of
wage stagnation and the spread of low-wage jobs that began in the 1970s took place
during a period of decline in union membership and influence that is unprecedented in the
modern era among developed democracies. Some of organized labor's decline is clearly

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