What is "laissez-faire" and why is it considered to be best for economic growth?

Laissez faire, loosely translated from the French, means "to leave alone."  It refers to the economic system we more commonly call "the free market," "private enterprise," or "capitalism."  I happen to be personally an advocate of laissez faire, so I think I can give you a fair and accurate description of it and why it works, as opposed to a hostile or biased perspective.
 
The economic system of laissez faire has several elements: 1) respect for private property; 2) freedom to start and own a business; 3) free markets in trade (that is, no government price controls or excessive intervention); and a government limited to a "nightwatchman" function, which means essentially making sure through its police and courts that contracts are not broken, disputes are peaceably settled, everyone's rights are upheld, and that society is defended against lawbreakers internally and aggressive enemies from abroad.
 
Laissez faire works best for economic growth because it provides individuals with the greatest incentive to create wealth.  Under laissez-faire capitalism, you cannot wrap a robe around you, put a crown on your head, and demand that people give you money.  That's what kings and queens do.  Instead, under laissez faire, if you want to get rich, you have to be inventive or innovative; you have to produce a product that people want and can afford; you have to be better and quicker than others at serving customers if you want to earn the most.  Because you can't make money in laissez faire if, for example, you cheat customers, steal from your workers, or produce a shoddy product, it promotes excellence.  Of course, there are plenty of exceptions--bad people doing bad things, for example--but that's what government's limited function is supposed to handle.  Otherwise, the vast majoritiy of people as entrepreneurs and workers are generally honest and engage in peaceful commerce under laissez faire--investing, selling, buying, and producing more and better things for more people because that's how they get ahead.
 
All over the world, experience has demonstrated the superiority of capitalism over any of its big-government counterparts.  Capitalism (or laissez faire) feeds and clothes and houses more people at higher levels than any other system.  Those nations that are burdened with socialist systems in which the government plays a very large role in the economy are also the countries that are the poorest in terms of economic wealth and growth.  Basically, people work harder, better, and longer when they are working for themselves or a private business than when they have to work for the government. 

 

"All over the world, experience has demonstrated the superiority of capitalism over any of its big-government counterparts."

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