Libertarianism is More Important than Democracy

It is my view that the most important determinant of a country's success is how libertarian that society is.  When I say libertarian, I mean voluntary exchange.  Those countries that allow the most voluntary exchange flourish the most.  It is not democracy that is the main factor.  A democracy that restricts voluntary exchange will fail and a dictatorship that allows voluntary exchange will succeed.

Democracies have a tendency to become less libertarian over time.  First, politicians want to buy votes.  They do this by giving free money to as many people as possible: students, the homeless, single mothers, the poor, the elderly.  All of these special interest groups will only continue to vote for those politicians that promise to continue or increase the free money.  Much of this money is taken from the producers in society.  As the producers are taxed more, they produce less, leave to freer lands, or work in the black market and society as a whole becomes poorer.  As the poor are subsidized, they become more numerous.  Thus, the bankruptcy of the government is set in motion.