Switzerland is arguably the world’s most successful country — and most improbably so. It is landlocked and without much in the way of natural resources. It has four official languages, many different religious groups, and is surrounded by warring neighbors. Yet, it has remained an island of peace and prosperity. The last armed conflict on Swiss territory occurred in a less‐than‐one‐month‐long civil war in 1847, where about 130 were killed. The last time it was invaded was by Napoleon in 1798. The core of the Swiss Confederation goes back to 1291, when three Swiss cantons (i.e., states) united in a common defense. Over the centuries, Switzerland has grown to its present 26 cantons.
The modern Swiss federal state goes back to 1848, when a federal constitution was adopted, giving the central government responsibility for defense, trade and legal matters. All other government matters were left to the cantons and the communes (i.e., cities and towns). The U.S. Constitution, which is more than a half‐century older than the Swiss, also greatly limited the powers of the central government — but unlike the Swiss, there has been a centralization of power in the capital at the expense of the states and local governments.
Switzerland now has a higher real per capita income than the United States, a lower unemployment rate (3.2 percent versus 5.5 percent), and approximately one‐third the amount of government debt in relation to gross domestic product. According to the latest annual Economic Freedom of the World index, Switzerland ranks No. 4 in economic freedom while the United States ranks No. 12. And by the way, Switzerland has the second‐highest life expectancy in the world, while the U.S. is far down the list.