Part of the series on Libertarianism

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Laissez-faire (pronunciation: French, [lɛsefɛʁ] (help·info); English, IPA: /ˌleɪseɪˈfɛər/) is a French phrase literally meaning "Let do. French ( français,) is a Romance language spoken around the world by 118 million people as a native language and by about 180 to 260 million people English is a West Germanic language originating in England and is the First language for most people in the United Kingdom, the United States French ( français,) is a Romance language spoken around the world by 118 million people as a native language and by about 180 to 260 million people " From the French diction first used by the eighteenth century physiocrats as an injunction against government interference with trade, it became used as a synonym for strict free market economics. The physiocrats were a group of Economists who believed that the wealth of nations was derived solely from the value of land Agriculture or land development A free market is a Market in which property rights are voluntarily exchanged at a price arranged completely by the mutual consent of sellers and buyers Economics is the social science that studies the production distribution, and consumption of goods and services. It is generally understood to be a doctrine that maintains that private initiative and production are best allowed to be free of economic interventionism and taxation by the state beyond what is necessary to maintain individual liberty, peace, security, and property rights. Economic interventionism, is a common term used to describe any activity beyond the basic regulation of fraud and enforcement of contracts undertaken by a government in an effort to affect Property is any physical or virtual entity that is owned by an individual ^[2]

Laissez-faire is supported by proponents of libertarianism, classical liberalism, neoliberalism, minarchism and Objectivism. Libertarianism is a term used by a broad spectrum of political philosophies which prioritize individual Liberty and seek to minimize or even abolish the Classical liberalism (also known as traditional liberalism, Laissez-faire liberalism, Market liberalism or in much of the world Originally coined by its critics and opponents " neoliberalism " is a label referring to the recent reemergence of Economic liberalism or Classical liberalism In Civics, minarchism, sometimes called minimal Statism, small government, or limited-government Libertarianism Objectivism is a Philosophy developed by Ayn Rand in the 20th century that encompasses positions on Metaphysics, Epistemology, Libertarians argue that the free market produces greater prosperity and personal freedom than other economic systems. Freedom, or the idea of being free is a broad concept that The Austrian School of economics and the Chicago School of economics are important types of laissez-faire. The Austrian School, also known as the “ Vienna School ” or the “ Psychological School ” is a heterodox school of economics that advocates Market anarchists take the idea of laissez-faire to its extreme by opposing all taxation, preferring law and order to be privately funded. Free-market anarchism (sometimes called market anarchism) refers to an Individualist anarchist Philosophy that harmonizes the abolition of the state with

Origins of the term

The exact origins of the term "laissez-faire" as a slogan of economic libertarianism are uncertain. According to historical folklore, the phrase stems from a meeting c. 1680 between the powerful French finance minister Jean-Baptiste Colbert and a group of French businessmen led by a certain M. Jean-Baptiste Colbert ( August 29, 1619 — September 6, 1683) served as the French minister of finance from 1665 to 1683 under Le Gendre. When the eager mercantilist minister asked how the French State could be of service to the merchants, Le Gendre replied simply "Laissez-nous faire" ('Leave us be', lit. Mercantilism is the idea that a colony should export more goods than it imports and that a colony should sell at higher prices and buy at lower prices 'Let us do'). ^[3]

The 'laissez faire' slogan became closely associated with Vincent de Gournay, a French intendant of commerce in the 1750s and ardent proponent of the removal of restrictions on trade and the deregulation of industry in France, and a mentor of the later Physiocrats. Jean Claude Marie Vincent de Gournay (1712-1759 was a French economist and Intendant of commerce one of the creators of the laissez faire laissez The physiocrats were a group of Economists who believed that the wealth of nations was derived solely from the value of land Agriculture or land development Gournay was delighted by the LeGendre anecdote, and forged it into a larger maxim all his own: "Laissez faire et laissez passer, le monde va de lui même!" ('Let do and let pass, the world goes on by itself!'). Although Gournay left no written tracts on his economic policy ideas, his immense personal influence on the thinking of his contemporaries, notably the Physiocrats, is generously acknowledged in their testimonies. The physiocrats were a group of Economists who believed that the wealth of nations was derived solely from the value of land Agriculture or land development Among others, Jacques Turgot,Tyler Caron, the Marquis de Mirabeau, the Comte d'Albon and, most insistently, DuPont de Nemours credit both the 'laissez-faire' slogan and doctrine to Gournay. Anne-Robert-Jacques Turgot Baron de Laune, often referred to as Turgot ( 10 May 1727 &ndash 18 March 1781) was a French Victor de Riquetti marquis de Mirabeau ( October 5, 1715, Pertuis &ndash July 13, 1789) was a French Economist of the Pierre Samuel du Pont de Nemours ( December 14, 1739 &ndash August 7 1817) was a French Writer, Economist ^[4]

The honour of the first recorded use of the 'laissez faire' maxim goes to the contemporary French minister Rene de Voyer, Marquis d'Argenson, another champion of free trade. René-Louis de Voyer de Paulmy marquis d' Argenson ( October 18 1694 - January 10 1757) was a French ^[5] However, there is little dispute that it was Gournay who gave the maxim its vogue - or at least it was persistently ascribed to him by the Physiocrats, particularly DuPont de Nemours. The physiocrats were a group of Economists who believed that the wealth of nations was derived solely from the value of land Agriculture or land development D'Argenson, during this time, was better known for the similar but less-celebrated motto "Pas trop gouverner" ("Govern not too much"). ^[6]

In English, a variety of "free trade" and "non-interference" slogans had been coined already in the seventeenth century. The first known appearance of the French motto 'laissez faire' in an English text is in the writings of the London merchant Charles Bosanquet in 1808. ^[7]. It was originally introduced in the English-language world in 1774, by George Whatley, in the book Principles of Trade, which was co-authored with Benjamin Franklin. George Whatley, Esq was a contemporary friend and correspondent of Benjamin Franklin, Vice-President (1772-1779 and Treasurer (1779-1791 of the Foundling Hospital Benjamin Franklin ( April 17 1790 was one of the Founding Fathers of the United States of America. Classical economists, such as Thomas Malthus, Adam Smith and David Ricardo did not use the term. Thomas Robert Malthus FRS (13 February 1766 – 23 December 1834 was an English political economist and demographer who expressed views Adam Smith ( baptised 16 June 1723 – 17 July 1790) was a Scottish moral philosopher and a pioneer of Political economy. David Ricardo (18 April 1772 &ndash 11 September 1823 was an English political economist, often credited with systematizing economics and was one of the most influential Bentham employed it, but only with the advent of the Anti-Corn Law League did the term receive much of its (English) meaning. Jeremy Bentham ( IPA: or) (15 February 1748&ndash6 June 1832 was an English Jurist, Philosopher, and legal and Social reformer The Anti-Corn Law League was in effect the resumption of the Anti-Corn Law Association which had been created in London in 1836 but did not obtain widespread popularity ^[8] Nonetheless, it was probably James Mill's reference to the 'laissez-faire' maxim (together with 'pas trop gouverner') in an 1824 entry for Encyclopedia Britannica that really brought the term into wider English usage. James Mill (6 April 1773 &ndash 23 June 1836 was a Scottish Historian, Economist, Political theorist, and Philosopher.

Economic and political theory

Main article: Free market

Laissez-faire activists support no governmental intervention: free markets, minimal taxes, minimal regulations and private ownership of property. A free market is a Market in which property rights are voluntarily exchanged at a price arranged completely by the mutual consent of sellers and buyers They support negative liberty and oppose positive liberty, such as wealth redistribution, given by the state. The concept of negative liberty refers to freedom from interference by other people ||-||} Positive liberty refers to the opportunity and ability to act to fulfill one's own potential as opposed to Negative liberty, which refers to freedom from Redistribution of wealth refers to the transfer of wealth from some individuals to others However, some laissez-faire proponents, especially those who attend to the Chicago School, prefer Milton Friedman's negative income tax as a replacement to the existing welfare system, arguing that it is simpler and has fewer of the "perverse incentives" of "government handouts". Milton Friedman (July 31 1912 November 16 2006 was an American Nobel Laureate Economist and Public intellectual. In Economics, a negative income tax (abbreviated NIT) is a Progressive income tax system where people earning below a certain amount receive supplemental A perverse incentive is an Incentive that has an unintended and undesirable effect that is against the interest of the incentive makers Entitlement is a guarantee of access to benefits because of rights or by agreement through Law.

They are based on the belief that redistribution of wealth takes capital from the most productive sectors of the economy, and is enforcing economic egalitarianism, which reduces productivity and the incentive to work. Economic egalitarianism is a state of economic affairs in which the participants of a society are of equal standing and equal access to all the economic resources in terms of economic power They may further argue that any temporary equality of outcome gained by redistribution would quickly collapse without coercion because people have different levels of motivation and native abilities, and would make different choices based on their differing values. Equality of outcome or equality of condition is a form of Egalitarianism which seeks to reduce or eliminate differences in material condition between individuals or Material inequality, they argue, is a necessary outcome of the freedom to choose one's own actions without imposing on others.

Like the mainstream Neoclassical economics, the Austrian School and the Chicago School support the subjective theory of value, which says that only a buyer and seller, while using information shared and available in the marketplace, can determine how valuable goods or services are to them and thereby set a mutually agreeable price. Neoclassical economics is a term variously used for approaches to Economics focusing on the determination of prices outputs and income distributions in markets The Austrian School, also known as the “ Vienna School ” or the “ Psychological School ” is a heterodox school of economics that advocates The subjective theory of value (or theory of subjective value) is an economic theory of value that holds that "to possess value an object must be both useful They contend that supply and demand, as ordered by the incidence of independent, subjective valuations in a free market, are the only sensible means of establishing prices. Supply and demand is an Economic model describing effects on price and quantity in a Market. The subjective theory of value (or theory of subjective value) is an economic theory of value that holds that "to possess value an object must be both useful Moreover, they believe that only prices rendered in a free market can synthesize and communicate the preferences and relevant, time-sensitive data to millions of consumers and producers alike, and that any attempt to objectify these transactions by a centralized authority will fail.

According to them, any government intervention such as regulation, protectionism, creating legal monopolies, competition laws, or taxes, interfere with this judgment being reflected accurately in the price and the maximization of economic utility. This article is for the legal term For regulation of genes see Regulation of gene expression. For the protectionist Australian political party from the 1880s to 1909 see Protectionist Party A legal monopoly, statutory monopoly, or de jure monopoly is a Monopoly that is protected by law from competition

Supporters of laissez-faire favor a state that is neutral between the various competing interest groups that vie for privileges and political power in a country. Political power ( Imperium in Latin is a type of power held by a group in a Society which allows administration of some or all of They are critical of mixed economies on the grounds that it leads to an interest-group politics where each group is seeking to benefit itself at the expense of another and the consumer. A mixed economy is an Economic system that incorporates aspects of more than one economic system They oppose government funding or regulation of schools, hospitals, industry, agriculture, and social welfare programs. However, the Chicago School justifies school voucher systems on the grounds of fairness. A school voucher, also called an education voucher, is a certificate issued by the government by which parents can pay for the Education of their children at a

They tend to believe that minimizing taxes decreases the chance that the government would fund bad programs and prevents citizens from needing government assistance because they have more of their own money (see "starve the beast"). "Starving the beast" is a fiscal-political strategy of some American conservatives to use budget deficits via Tax cuts to force future reductions in the

Private defense agencies^[9] and intellectual property^[10] are a source of controversy amongst laissez-faire advocates. A private defense agency (PDA is a conceptualized agency that provides personal protection and military defense services voluntarily through the Free market. Intellectual property ( IP) is a legal field that refers to creations of the mind such as musical literary and artistic works inventions and symbols names This is what usually divides the minarchists who advocate government police and military, and anarcho-capitalists who want full privatization of goods. Anarcho-capitalism (also known as Free-market anarchism) is an individualist anarchist Political philosophy that advocates the elimination For many of the latter, the principle of liberty must overcome the goal of wealth. The public good of police, for instance, could be seen as immoral coercion no matter how efficient over private security.

Monetary theory

The Austrian School is opposed to fiat currency because they do not trust the government to restrain itself from over-expanding the money supply which would result in inflation. The Austrian School, also known as the “ Vienna School ” or the “ Psychological School ” is a heterodox school of economics that advocates The terms fiat currency and fiat money relate to types of currency or Money whose usefulness results not from any intrinsic value or guarantee that it can be In economics inflation or price inflation is a rise in the general level of prices of goods and services over a period of time They tend to favor hard assets such as the gold standard. The gold standard is a monetary system in which a region's common media of exchange are paper notes that are normally freely convertible into pre-set fixed quantities of Gold Inflation is commonly regarded by libertarians as a surreptitious method of taxation employed to usurp value from privately held money without levying an apparent tax and demanding physical transfer of money (see Chicago School of economics).

History of laissez-faire debate

Europe

In nineteenth century Britain, laissez-faire found a small but strong following by such Manchester Liberals as Richard Cobden and Richard Wright. Manchester Capitalism, Manchester School, Manchester Liberalism or Manchesterism are terms for political economic and social movements of the 19th century Richard Cobden ( June 3, 1804 &ndash April 2, 1865) was a British manufacturer and Radical and Liberal In 1867, this resulted in a free trade treaty being signed between Britain and France, after which several of these treaties were signed among other European countries. The newspaper The Economist was founded, partly in opposition to the Corn Laws, in 1843, and free trade was discussed in such places as The Cobden Club, founded a year after the death of Richard Cobden, in 1866. The Economist is an English-language weekly news and International affairs publication owned by The Economist Newspaper Ltd and edited in London The Corn Laws were Import tariffs designed to support domestic British corn prices against competition from less expensive foreign-grain imports between 1815 and 1846 Free trade is a system in which the trade of goods and services between or within countries flows unhindered by government-imposed restrictions ^{[11] [12]}

However, laissez-faire was never the main doctrine of any nation, and at the end of the eighteen-hundreds, European countries would find themselves taking up economic protectionism and interventionism again. France for example, started cancelling its free trade agreements with other European countries in 1890. Germany's protectionism started (again) with a December 1878 letter from Bismarck, resulting in the iron and rye tariff of 1879. For the protectionist Australian political party from the 1880s to 1909 see Protectionist Party Otto Eduard Leopold von Bismarck Count of Bismarck-Schönhausen Duke of Lauenburg Prince of Bismarck ( April 1, 1815 July 30, 1898) For other uses of this word see Tariff (disambiguation. A tariff is a tax imposed on goods when they are moved across a political boundary

United States

Although the period before the American Civil War was notable for the limited extent of the federal government, there was still a considerable degree of government intervention in the economy--particularly after the 1820s. Causes of the war See also Origins of the American Civil War, Timeline of events leading to the American Civil War The coexistence of a slave-owning South Notable examples of government intervention in the period prior to the Civil War include the establishment of the First Bank of the United States and Second Bank of the United States as well as various protectionist measures (e. The First Bank of the United States was a Bank chartered by the United States Congress on February 25, 1791. The Second Bank of the United States was a bank chartered in 1816 five years after the expiration of the First Bank of the United States. g. , the tariff of 1828). The Tariff of 1828, also known as the Tariff of Abominations, enacted on May 19 1828 (ch Several of these proposals met with serious opposition, and required a great deal of horse trading to be enacted into law. For instance, the First National Bank would not have reached the desk of President George Washington in the absence of an agreement that was reached between Alexander Hamilton and several southern members of Congress to locate the capital in the District of Columbia. George Washington (February 22 1732 December 14 1799 served as the first President of the United States of America (1789&ndash1797 and led the Washington DC ( formally the District of Columbia and commonly referred to as Washington, the District, or simply D In contrast to Hamilton and the Federalists was the opposing political party the (Democratic)-Republicans. The early Republican party led by Jefferson was very pro-Laissez-Faire. In fact Jefferson wished to only have the government do three things: collect a census (every ten years), collect duties; the government's only tax (I think), and run the postal service. Jefferson also had very few federal employees especially compared to today's American government.

Most of the early proponents of a mixed economy in the United States subscribed to the American School (economics). A mixed economy is an Economic system that incorporates aspects of more than one economic system See also American System (economic plan. The American School, also known as " National System " represents three different yet This school of thought was inspired by the ideas of Alexander Hamilton, who proposed the creation of a government sponsored bank and increased tariffs to favor northern industrial interests. Following Hamilton's death, the more abiding protectionist influence in the antebellum period came from Henry Clay and his American System. Henry Clay Sr ( April 12, 1777 &ndash June 29, 1852) was a nineteenth-century American statesman and Orator who The American System was a Mercantilist economic plan based on the " American School " ideas of Alexander Hamilton, expanded upon later by Friedrich

Following the Civil War, the movement towards a mixed economy accelerated with even more protectionism and government regulation. For the protectionist Australian political party from the 1880s to 1909 see Protectionist Party This article is for the legal term For regulation of genes see Regulation of gene expression. In the 1880s and 1890s, significant tariff increases were enacted (see the McKinley Tariff and Dingley Tariff). The McKinley Tariff of 1890 was what set the average ad valorem Tariff rate for imports to the United States at 48 The Dingley Act of 1897 (ch 11, July 24, 1897) introduced by U Moreover, with the enactment of the Interstate Commerce Act of 1887, the Sherman Anti-trust Act, the federal government began to assume an increasing role in regulating and directing the country's economy. The Interstate Commerce Commission (or ICC) was a Regulatory body in the United States created by the Interstate Commerce Act of 1887 which was signed The Sherman Antitrust Act ( Sherman Act, July 2, 1890, ch 647,) was the first United States Federal statute to limit Cartels and

The Progressive Era saw the enactment of even more controls on the economy, as evidenced by the Wilson Administration's New Freedom program. The Progressive Era in the United States was a period of reform which lasted from the 1890s to the 1920s

Following World War I and the Great Depression, Keynesian policies turned the state into a mixed economy. World War I (abbreviated WWI; also known as the First World War, the Great War, and the War to End All In Economics Keynesian economics (ˈkeɪnziən also Keynesianism and Keynesian Theory) is based on the ideas of twentieth-century British economist A mixed economy is an Economic system that incorporates aspects of more than one economic system The United States, in the 1980s, for example, sought to protect its automobile industry by "voluntary" export restrictions from Japan. ^[13] One scholar wrote about the early 1980s that:

The Great Depression

Main article: Causes of the Great Depression

Scholarly debate over the cause of the Great Depression questions the involvement of Laissez-faire economics in the incident, some blaming it and others exonerating it. The causes of the Great Depression are still a matter of active debate among Economists The specific economic events that took place during the Great Depression have The causes of the Great Depression are still a matter of active debate among Economists The specific economic events that took place during the Great Depression have

There is much debate over the relationship between laissez-faire economics and the onset of the Great Depression. Some economists and historians (such as John Maynard Keynes) argue that laissez-faire economic policy fostered the conditions under which the Great Depression arose. John Maynard Keynes 1st Baron Keynes CB (ˈkeɪnz "cains" (5 June 1883 &ndash 21 April 1946 was a British Economist whose ideas Other scholars, such as Milton Friedman and Murray Rothbard, say that the Depression was not a result of laissez-faire economic policy but of government intervention on the monetary and credit system. Milton Friedman (July 31 1912 November 16 2006 was an American Nobel Laureate Economist and Public intellectual. Murray Newton Rothbard (March 2 1926 – January 7 1995 was an American economist of the Austrian School who helped define modern Libertarianism The issue, as outlined below, remains heavily debated in economic, historical, and political spheres.

In Keynes's 1936 work, The General Theory of Employment Interest and Money, Keynes introduced concepts and terms that were intended to help explain the Great Depression. One argument for a laissez-faire economic policy during a recession was that if consumption fell, then the rate of interest would fall. Lower interest rates would lead to increased investment spending and demand would remain constant. However, Keynes believed that there are reasons why investment does not necessarily automatically increase as a response to a fall in consumption. Businesses make investments based on expectations of profit. According to Keynes, if a fall in consumption appears to be long-term, businesses analyzing trends will lower expectations of futures sales and will not invest in increasing future production even if lower interest rates make capital inexpensive. In that case, according to Keynes and contrary to Say's law, the economy can be thrown into a general slump. In Economics, Say’s Law or Say’s Law of Markets is a principle attributed to French businessman and economist Jean-Baptiste Say (1767-1832 stating (Keen 2000:198) Keynesian economists and historians argue that this self-reinforcing dynamic is what happened to an extreme degree during the Depression, where bankruptcies were common and investment, which requires a degree of optimism, was very unlikely to occur. In Economics Keynesian economics (ˈkeɪnziən also Keynesianism and Keynesian Theory) is based on the ideas of twentieth-century British economist As a solution to this Keynes proposed to alleviate market instability through government intervention. In his view, since private actors cannot be counted on to create aggregate demand during a recession, the government has the responsibility to create demand. ^[15] Keynes saw his macroeconomic theory much better suited for totalitarian systems than those governed by the principles of laissez-faire. Totalitarianism (or totalitarian rule) is a concept used to describe Political systems where a State regulates nearly every aspect of public and private He highlighted this in the foreword to the German edition of 'The General Theory of Employment Interest and Money: "The theory of aggregate production, which is the point of the following book, nevertheless can be much easier adapted to the conditions of a totalitarian state than the theory of production and distribution of a given production put forth under conditions of free competition and a large degree of laissez-faire. "^[16]

Friedrich August von Hayek and Milton Friedman argued that the Great Depression was not a result of laissez-faire economic policy but a result of too much government intervention and regulation upon the market. Friedrich August von Hayek CH ( May 8, 1899 March 23, 1992) was an Austrian British Economist Milton Friedman (July 31 1912 November 16 2006 was an American Nobel Laureate Economist and Public intellectual. They note that the Great Depression was the longest depression in U. S. history and the only depression in which the government heavily intervened. In Friedman's work, Capitalism and Freedom he argues: "A governmentally established agency--The Federal Reserve System--had been assigned responsibility for monetary policy. Capitalism and Freedom is a book by Milton Friedman originally published in 1962 which discusses the role of Economic Capitalism in In 1930 and 1931, it exercised this responsibility so ineptly as to convert what otherwise would have been a moderate contraction into a major catastrophe. "^[17]

Furthermore, the U. S. Federal government had created a fixed currency pegged to the value of gold. At one point the pegged value was considerably higher than the world price, which created a massive surplus of gold. World wide demand for gold surged, but the pegged value was too low in the U. S. This created a massive migration of gold from the U. S. Milton Friedman and Hayek both argued that this inability to react to currency demand created a run on the banks that they were not able to handle. Milton Friedman (July 31 1912 November 16 2006 was an American Nobel Laureate Economist and Public intellectual. Friedrich August von Hayek CH ( May 8, 1899 March 23, 1992) was an Austrian British Economist The banks inability to handle such a run, and the fixed exchange rates between the dollar and gold; both worked to cause the Great Depression by creating, and then not fixing, deflationary pressures. ^[18] He further argued in this thesis, that the government inflicted more pain upon the American public by first raising taxes, then by printing money to pay debts (thus causing inflation), the combination of which helped to wipe out the savings of the middle class. Friedman concludes that the effects of the Great Depression were not mitigated until after World War II when the economy saw a return to normalcy with the elimination of many price controls. This opinion specifically blames a combination of Federal Reserve policies and economic regulation by the U. S. government as causes of the Great Depression, and that the depression was exacerbated by raising income taxes on the highest incomes from 25% to 63%, a "check tax", and the Smoot-Hawley tariff. The Smoot-Hawley Tariff Act (sometimes known as the Hawley-Smoot Tariff Act) was an act signed into law on June 17 1930, that raised U Friedman believed that Herbert Hoover's interventionist policies and Franklin Roosevelt's New Deal further lengthened and worsened the depression. Herbert Clark Hoover (August 10 1874 &ndash October 20 1964 was the thirty-first President of the United States (1929–1933 The New Deal was the name that United States President Franklin D Friedman concludes, "The Great Depression in the United States, far from being a sign of the inherent instability of the private enterprise system, is a testament to how much harm can be done by mistakes on the part of a few men when they wield vast power over the monetary system of a country. "^[19]

Laissez-faire today

Many modern nations today are not representative of laissez-faire principles or policies, as they usually involve significant amounts of government intervention in the economy. This intervention includes minimum wages, corporate welfare, anti-trust regulation, nationalized industries, intellectual property, licenses and welfare programs among other forms of government intervention. A minimum wage is the lowest hourly daily or monthly Wage that employers may legally pay to employees or workers Corporate welfare is a term describing a government's bestowal of money grants tax breaks, or other special favorable treatment on Corporations or select corporations Nationalization, also spelled nationalisation, is the act of taking an industry or assets into the Public ownership of a national government Intellectual property ( IP) is a legal field that refers to creations of the mind such as musical literary and artistic works inventions and symbols names The verb license or grant license means to give permission The noun license is the document demonstrating that permission "Social welfare" redirects here For other uses see Welfare A social welfare provision refers to any program which seeks to provide Subsidy programs for businesses and agricultural products; government ownership of some industry (usually in natural resources); regulation of market competition; economic trade barriers in the form of protective tariffs - quotas on imports - or internal regulation favoring domestic industry; and other forms of government favoritism. Public ownership (also called government ownership, state ownership or state property) refers to Government Ownership of any Trade is the willing exchange of goods, services, or both Trade is also called Commerce. The now-ubiquitous worldwide money regulating agencies such as the U. S. Federal Reserve System (although it is technically privately owned) and other government owned-and-operated central banking systems are seen as artificial at best and damaging at worst. A central bank, reserve bank, or monetary authority is the entity responsible for the Monetary policy of a country or of a group of member states Fractional-reserve banking is the banking practice in which Banks keep only a fraction of the value of their Bank notes and demand deposits in reserve

According to the 2008 Index of Economic Freedom issued by the Heritage Foundation, the seven countries with the most free economies are currently the following: Hong Kong, Singapore, Ireland, Australia, United States, New Zealand and Canada (all of them former constituents of the British Empire). The Heritage Foundation is an American conservative Think tank. Hong Kong ( officially the Hong Kong Special Administrative Region, is a territory located on China 's south coast on the Pearl River Delta, and borders Singapore Ireland (pronounced /ˈaɾlənd/ Éire) is the third largest island in Europe, and the twentieth-largest island in the world For a topic outline on this subject see List of basic Australia topics. The United States of America —commonly referred to as the New Zealand is an Island country in the south-western Pacific Ocean comprising two main landmasses (the North Island and the South Island Country to "Dominion of Canada" or "Canadian Federation" or anything else please read the Talk Page The British Empire was the largest empire in history and for over a century was the foremost global power. Hong Kong is ranked number one for 14 consecutive years in the Index which attempts to measure "the absence of government coercion or constraint on the production, distribution, or consumption of goods and services beyond the extent necessary for citizens to protect and maintain liberty itself. " Because of this, Milton Friedman described Hong Kong as laissez-faire state and he credits that policy for the rapid move from poverty to prosperity in 50 years. Milton Friedman (July 31 1912 November 16 2006 was an American Nobel Laureate Economist and Public intellectual. Hong Kong ( officially the Hong Kong Special Administrative Region, is a territory located on China 's south coast on the Pearl River Delta, and borders ^[20] Much of this growth came under British colonial control prior to the 1997 resumption of sovereignty by the People's Republic of China. Talk People's Republic of China) PEOPLE'S REPUBLIC OF CHINA ARTICLE GUIDELINES However at a press conference on 11 September 2006, Donald Tsang, the Chief Executive of Hong Kong said that "Positive non-interventionism was a policy suggested by a previous Financial Secretary many years ago, but we have never said that we would still use it as our current policy. Events 9 - The Battle of the Teutoburg Forest ends 506 - The Bishops of Visigothic Gaul Year 2006 ( MMVI) was a Common year starting on Sunday of the Gregorian calendar. Sir Donald Tsang Yam-Kuen, GBM, KBE, JP (born 7 October 1944 is the current Chief Executive and Head of Government of Hong Positive non-interventionism was the economic policy of Hong Kong during British rule . . We prefer the so-called 'big market, small government' policy. " Responses in Hong Kong were widely divided, some see it as an announcement to abandon the positive non-interventionism, others see it as a more realistic response to the government policies in the past few years, such as the intervention of the stock market to prevent brokering. ^[21].

Criticism of Laissez-Faire

Laissez-faire or free market economics has a long history of association with dictatorial and genocidal governments. A free market is a Market in which property rights are voluntarily exchanged at a price arranged completely by the mutual consent of sellers and buyers Naomi Klein argues in her 2007 book "The Shock Doctrine" that free markets have not historically received popular democratic support and that deregulation, privatisation and public spending cuts are only ever accepted by people after some form of traumatic shock. Naomi Klein (b 8 May 1970, Montreal Quebec) is a Canadian Journalist, Author and activist well known for her The Shock Doctrine The Rise of Disaster Capitalism is a 2007 Book by Canadian Journalist Naomi Klein. Deregulation, a term which gained widespread currency in the period 1970-2000 can be seen as a process by which governments remove reduce or simplify Restrictions on Business Privatization is the incidence or process of transferring ownership of business from the Public sector (government to the Private sector (business Klein states many past examples such as Pinochet's Chile, Suharto's Indonesia and Tiananmen Square Massacre-era China which show that the demands and needs of the population have been not only ignored but violently repressed in order to open up free markets. Augusto José Ramón Pinochet Ugarte (November Chile, officially the Republic of Chile ( Spanish:) is a country in South America occupying a long and narrow Coastal strip wedged between the Suharto, also spelled Soeharto (June 8 1921 &ndash January 27 2008 was an Indonesian military leader and the second President of Indonesia, holding The Republic of Indonesia ( (Republik Indonesia is a Country in Southeast Asia. The Tiananmen Square protests of 1989 culminating in the Tiananmen Square Massacre (referred to in Chinese as the June Fourth Incident, to avoid confusion with two China ( Wade-Giles ( Mandarin) Chung¹kuo² is a cultural region, an ancient Civilization, and depending on perspective a National ^[22]

Criticism from anarcho-capitalists

Further information: Market anarchism and Anarcho-capitalism

Murray Rothbard was a prominent critic of laissez-faire minarchism. Free-market anarchism (sometimes called market anarchism) refers to an Individualist anarchist Philosophy that harmonizes the abolition of the state with Anarcho-capitalism (also known as Free-market anarchism) is an individualist anarchist Political philosophy that advocates the elimination Murray Newton Rothbard (March 2 1926 – January 7 1995 was an American economist of the Austrian School who helped define modern Libertarianism In Civics, minarchism, sometimes called minimal Statism, small government, or limited-government Libertarianism As an anarcho-capitalist, he argued that government defence is inefficient. Anarcho-capitalism (also known as Free-market anarchism) is an individualist anarchist Political philosophy that advocates the elimination He criticized laissez-faire activists for supporting geographically large, minarchist states. In his book Power and Market, he argued that geographically large minarchist states are indifferent from a unified minarchist world monopoly government. Power and Market Government and the Economy is a 1970 book by Murray Rothbard in which he analyzes the negative effects of the various kinds of Government ^[23]

References

Bibliography

• Brebner, John Bartlet (1948). "Laissez Faire and State Intervention in Nineteenth-Century Britain". Journal of Economic History 8: 59-73.  
• Fisher, Irving (January 1907). Irving Fisher ( February 27 1867 Saugerties, New York &ndash April 29 1947, New York was an American economist "Why has the Doctrine of Laissez Faire been Abandoned?". Science 25 (627): 18-27. Science is the Academic journal of the American Association for the Advancement of Science and is considered one of the world's most prestigious Scientific  
• Taussig, Frank W. (1904). Frank William Taussig (1859 - 1940 was a US Economist and Educator, born in St "The Present Position of the Doctrine of Free Trade". Publications of the American Economic Association 6 (1): 29-65. The American Economic Association, or AEA, is the oldest and most important professional organization in the field of Economics.  

Further reading

• August Oncken (1886). Die Maxime Laissez faire et laissez passer : ihr Ursprung, ihr Werden. Ein Beitrag zur Geschichte der Freihandelslehre. Bern: K. J. Wyss.  
• Wu-Wei in Europe. A Study of Eurasian Economic ThoughtPDF (773 KiB) by Christian Gerlach, London School of Economics – March 2005
• John Maynard Keynes, The end of laissez-faire (1926)

See also

• Free market
• Market anarchism
• Anarcho-capitalism
• Minarchism
• Libertarianism
• Objectivism
• Classical liberalism
• Economic liberalism
• Capitalism
• Criticisms of capitalism