Capitalism. A lot of people think it's a Thing, like Marxism. Honestly, not even Marx thought that, but the reality is that capitalism is just part of what people do in a state of nature.
Sometime about 10,000 years ago, people had this great idea: Instead of hunting and gathering, why don't we make the food come to us? We started growing food — we invented agriculture. Around the same time, some people had another great idea: Instead of hunting wild boars and aurochs and sheep, why don't we pen them up and feed them so they're nice and fat and easy to catch? Then the people growing food and the people enclosing wild beasts had this really great idea: The ones growing food could swap some of the food for some of the penned animals, or their meat.
And that was the birth of capitalism.
Shortly after that, someone got his gang together, took sticks, and went to the people happily eating meat and grain and with spare time to make pots and clothes, and said, "Give us your meat and grain, or we'll beat you with our sticks." And that was the birth of taxes.
Sometime around the 5th century BC, some old boy (Laozi — that's what 老子 means) observed that things will often settle down on their own. He called it 無為 wu wei. That's hard to translate — it means something like "doing without doing," which frankly doesn't make a lot of sense in English on its own.
(You've undoubtedly seen it as something like Lao Tzu or Lao Tse. There are probably a thousand competing ways of transliterating Chinese into Roman characters, and none of them are really satisfactory. In the old Wade-Giles system, "Tao" would be pronounced "dow" like in Dow Jones, and that was the common system for more than a century. "T'ao" would be pronounced with the "T" sound. In Pinyin ["sound spell"], it's Dao. Pinyin has become the standard because a billion people use it. What can I tell you?)
But there's a fine translation in European languages: laissez-faire. The story is that the King of France was trying to encourage farmers with lots of rules and suggestions and inspectors, with little success. Someone finally had the idea to ask the farmers, and they cried, "Laissez-nous faire!" — "Let us alone!"
Laozi's book, The Daodejing, is a lot of things — books have been written about single chapters — but among other things, it's advice to rulers and governments. Chapter 57 says:
I take no action and the people transform themselves.
I prefer stillness and the people right themselves.
I do not interfere and the people enrich themselves.
I have no desires and the people return to simplicity.
The more prohibitions and regulations, the poorer people become; the more laws and "programs," the more fraud there is.
This isn't really a new idea, honestly. Murray Rothbard called Laozi "the first libertarian intellectual." In 1999, economist Ken McCormick wrote "The Tao of Laissez Faire," which makes a similar argument. There are even some reasons to believe the Physiocrats in 18th-century France, who originated the "laissez-faire, laissez-passer" slogan, were influenced by Jesuit translations of Laozi.
Now, Laozi wasn't suggesting the wild acquisitiveness of "influencers" — he also said things like "he who knows he has enough is rich." But then, Elon Musk is certainly the most successful capitalist of the 21st century, and he lives in a $50,000 prefab tiny house.
Laozi's key insight was simply this: Knowledge is widely, even wildly, dispersed. Rulers simply cannot know everything and so cannot fine-tune a system as complex as people making free choices to achieve their own satisfaction can. Jefferson was onto something when he said the goal of government is to provide for "life, liberty, and the pursuit of happiness." Markets transform themselves — when left alone.
The good advice here — wu wei, laissez-faire — is all really the same. Free people, left to themselves, do best when the government does least.
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