Are you better off than you were 40 years ago? Government has grown, but freedom has grown faster.

• Author: de Rugy, Veronique
• Position: Column

IN THE NOVEMBER 1968 Mechanix Illustrated, James Berry gave an eerily prescient glimpse of life in the typical American household today: "The single most important item in 2008 households is the computer. These electronic brains govern everything from meal preparation and waking up the household to assembling shopping lists and keeping track of the bank balance ... handle travel reservations, relay telephone messages, keep track of birthdays and anniversaries, compute taxes and even figure the monthly bills for electricity, water, telephone and other utilities."

Though Berry was spot-on in predicting the technological advancements of the last 40 years, he didn't say much about whether such progress would explicitly enhance the cause of freedom. Many libertarians, eyeing the relentless expansion of the state, worry that freedom is marching backward. But are we really worse off than we were 40 years ago?

This is a complicated question to measure. Wealth expands people's choices, and Americans are fabulously more prosperous than they were in 1968. According to the Census Bureau, income per capita adjusted for inflation has doubled in the four decades since 1968, from $13,374 to $26,804. Non-wage compensation, in the form of employee benefits, has also increased greatly during that time.

There's a better measure of living standards than raw wealth: consumption. By this measure, the United States is also doing very well. Luxury goods that few could afford in 1968 are now standard in most households, including poor ones. Writing in the July/August 2008 American, Michael Cox and Richard Alm, the senior vice president and chief economist and the senior economics writer at the Federal Reserve Bank of Dallas, reported that in 2005 a full 85 percent of households that are classified as poor by the Census Bureau have air conditioning (compared to only 36 percent in 1971); 97 percent have a color television (compared to 40 percent in 1971); 40 percent have an automatic dishwasher (as opposed to 20 percent in 1971); and almost 100 percent own a refrigerator (a 25 percent increase over 1970).

As Milton Friedman showed in Capitalism and Freedom, such wealth both feeds and is a byproduct of freedom. On one hand, freedom in economic arrangements produces wealth. This, in turn, produces a demand for more liberty, which then produces more prosperity. Thus, increasing wealth is usually correlated with increasing economic freedom. The deregulations of the...