Steve Landsburg also provides this context for the graph:
The measures of economic freedom come from the Fraser Institute’s Economic Freedom of the World project. Criteria include freedom to own foreign currencies and maintain bank accounts abroad, freedom to start businesses and compete, low taxes, low government spending, and equal treatment under the law. The most recent report ranked Hong Kong as the freest country in the world, with an overall rating of 9.05 out of a possible 10; the United States ranked sixth with a score of 7.96. Egypt, at 6.68, ranks 80th out of 141 countries.