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“Laissez-nous faire”

By Craig Wright | 09 Nov 2018 | Economics

Interventionist politics have played a growing role in all our economic lives. Each bailout is a step that is seldom regained, and as the government steps in, we do less. We expect to be able to fail and be saved. This only makes more failures. There is a single economic principle that has resulted in the phenomenal growth that we have experienced in the last 200 years: the free market.

Laissez faire, telle devrait être la devise de toute puissance publique, depuis que le monde est civilisé.

In contradiction to common mis-comprehensions, market cycles are induced by a lag effect from intervention and not a market principle (as is generally taught).

The often overlooked truth is that business cycles are a function of intervention and not free markets. The common counter example to this is the Great Depression. The fallacy is that this was neither an expression of free markets nor of a failure due to capitalism. Rather, the depression is a response to restricted trade and monetary policy. The US both introduced restrictive trade tariffs resulting in the collapse of international markets and restricted the money supply.

The introduction of regulations restricting and controlling the banking industry resulted in a tightened fiscal policy and fewer loans being available. This was heightened with the crowding out effect as the US Federal Reserve used funds for the New Deal policy, creating an environment where no money was available to business. With the increased enforcement of anti-trust legislation, business withered. The consequence: a larger federal government in the US and the spread of socialist policies that drove the burgeoning free markets into the grave.

Why should we treat businessmen and women differently. We allow sports people to earn exorbitant sums. We have rock stars earn as much as they can. We need to come into a world where a process of rewards attracts the best people to business. This means treating the business people as the rock stars. This means not interfering, and rewarding those at the top.

When will people wake up and see that the inefficiencies of the world are associated with groupthink and governments? It is about time that people decided to become free and think for themselves!