The 2012 Economic Freedom of the World report was released this week by the Cato Institute and Canada’s Fraser Institute, and it showed that the United States has plummeted to 18th place in the ranked list, trailing such countries as Estonia, Taiwan, and Qatar. Even such notorious welfare states as Finland and Denmark, not to mention Canada, have freer economies than we do.

Actually, the decline began under President George W. Bush. For 20 years the U.S. had consistently ranked as one of the world’s three freest economies, along with Hong Kong and Singapore. By the end of the Bush presidency, we were barely in the top ten.

And, as with so many disastrous legacies of the Bush era, Barack Obama took a bad thing and made it worse.

During the past four years, the U.S. saw significant declines in nearly all categories of the economic-liberty index. Most significant — and this should come as no surprise to anyone paying attention — is that the size of government grew substantially, particularly when measured by size of government subsidies and transfers and by government consumption as a share of national consumption.

As recently as 2005, the U.S. ranked 45th in size of government among the 144 nations surveyed. That was bad enough, but it still had us in the top third of the 144 countries surveyed. Today, government has grown dramatically, and our ranking has fallen to 61st place. By the metrics used, the U.S. now has a bigger government than Ukraine or Syria.

The United States has also seen a substantial increase in business regulations, labor-market restrictions, and barriers to trade. Our standing fell in all those categories, and we have undergone a long-term deterioration in ranking on property rights as well.

To anyone wondering why the U.S. is having such a hard time recovering from this recession, the 2012 report provides a pretty devastating diagnosis. We are clearly headed in the wrong direction.

Yet discussion of economic freedom seems curiously missing from the presidential campaign. President Obama, in fact, would further restrict economic liberty. He proposes a host of new subsidies and regulations. And don’t forget that the largest parts of Dodd-Frank kick in next year.

Meanwhile, when it comes to defending economic liberty, Mitt Romney has spent most of his time in a defensive crouch. He occasionally breaks form to promise he won’t really reduce taxes on the wealthy, won’t cut Medicare, and wants to keep some parts of Obamacare. He’s actually running ads attacking the president for not confronting China over trade.

Americans instinctively know the importance of economic freedom. They know that it is their ability to invest, start businesses, and hire workers that builds a prosperous country. They know that millions have come to this country and prospered because they had freedom to pursue their economic aspirations as well as their personal ones. And they find this freedom now slipping away.

They need a candidate to speak for them… and for freedom.