The Liberty of Creation and Commerce in Capitalism (Part 3 of 10)

In his excerpt from “Capitalism: A Treatise on Economics,” George Reisman emphasizes the establishment of laissez-faire capitalism through the abolition of government interference in production and trade. He argues that this necessitates eliminating a wide range of regulations, such as labor laws, licensing, antitrust laws, and zoning laws, while promoting the freedom of international trade and migration. The fundamental idea is that individuals should be empowered to solve their economic problems independently, utilizing their self-interest and voluntary actions. Reisman posits that many significant issues, such as mass unemployment and high costs of goods like housing and medical care, stem from government restrictions limiting the ability of individuals to negotiate and compete freely. The removal of such regulations would not only create employment opportunities but would also lower costs for essential services.

Reisman highlights mass unemployment as a critical economic concern, attributing it to government measures like minimum-wage legislation and unemployment benefits that distort the labor market. By abolishing these laws, he argues, individuals would be able to establish their terms of employment, resulting in increased job opportunities. Moreover, he believes the inability of American industries to compete in international markets is a consequence of government intervention, which leads to artificially high wage rates and increased costs due to regulations rather than a failure of free market principles. He recommends a campaign for the repeal of these interferences to restore competition and efficiency in the economy, outlining that these principles can be adapted to various industries that face similar challenges.

Furthermore, Reisman asserts that the concept of economic freedom can significantly reduce the costs of essential needs, such as housing and healthcare. He suggests that removing onerous regulations like those imposed by pro-union legislation, zoning laws, and building codes would allow for cheaper housing solutions. In healthcare, the current model restricts the supply of services through licensing, ultimately driving up costs instead of reducing them. Reisman’s solution is clear: the abolition of government interference in both housing and healthcare would result in increased supply, competition, and affordability, making these basic needs accessible to a larger portion of the population.

Challenging the conventional policy-making approach, Reisman advocates for a paradigm shift in public discourse from what new government programs can address economic issues to identifying which existing interventions must be eliminated. He emphasizes the significance of focusing on the restraining nature of government actions—specifically detailing how the removal of antitrust laws, the Environmental Protection Agency, and other regulatory bodies can lead to a more efficient economy and lower prices for consumers. His position is that the public must recognize the detrimental effects of government intervention and strive for its systematic reduction to unleash individual entrepreneurial energy and creativity.

Reisman acknowledges the practicality of seeking partial liberalization as a compromise when full deregulation cannot be achieved immediately. He proposes campaigns that focus on modest reforms within existing systems to showcase the benefits of greater freedom and the problems caused by government interference. For example, advocating for adjustments in housing code requirements while keeping the ultimate goal of complete deregulation in sight could raise public awareness about government-related costs and stimulate demand for more extensive deregulation in the future. Such strategies serve to underscore the need for an ongoing dialogue about dismantling government barriers while promoting a culture that values economic freedom.

Finally, Reisman contends that the ideal scenario would involve a sweeping abolition of government interferences across the board, arguing that pressure-group warfare—where specific groups gain at the expense of others—is self-defeating. By eliminating government protections that favor certain industries or labor groups, he argues that the economy would benefit as it would promote greater competition, reduce inefficiencies, and lower costs for consumers. He calls for the establishment of a Deregulation Agency, tasked solely with repealing existing regulations that infringe upon the freedom of production and trade, thereby ensuring a clear pathway toward a truly laissez-faire economic system. The goal is to empower individuals by creating a conducive environment for free trade and production, ultimately leading to a more prosperous society.