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Is the current Western economic world Laissez-Faire?

About Western Laissez-Faire

Well, only when I know your location can I begin to assess what western world you refer to. I am not writing that to be funny, it refers to the many terms and assumptions in economics we all interpret so differently. And no matter what West you are referring to, your question also assumes there is similarity in how all their economies are setup, not quite the case. Such assumptions and misinterpretations are the root cause of our economics being up for free and wild interpretation, which leads to further disheveled implementations of economics.

For the sake of answering your question let’s assume with the West you mean the U.S., where I live.

With that established, let me focus on the second part of the question. Laissez faire, meaning “letting go” in French,  is generally understood to refer to the notion that less governance is better. Yet, such letting go is a fundamental flaw in the establishment of free-market systems, for the establishment of paradoxical rules of collective freedom are an absolute necessity to protect and amplify individual freedoms. Free-markets can only be established, thrive and renew in conjunction with paradoxical rules to protect collective freedoms.

Laissez-faire is generally described as no interference by government, and in the context of aforementioned thus assumes the private sector will establish its own governance to protect collective freedoms. Past has demonstrated a private sector fond of and measured by short-term quarterly earnings deploys terrible self-governance to protect the long-term interests of collective freedom.

A clear example is the creation of a tobacco industry which produced great short-term wealth yet with insufficient self-governance of smoking’s devastating side effects as now the third leading cause of death (in the U.S.)  thirty years later, for which the next generations are coughing up ballooning medical insurance premiums. Other examples abound.

Reality is we in the U.S. have not deployed free-market systems at all, for we have not deployed a definition of freedom that encompasses the world. We have deployed freedom as absolutism void of the protection of (even our own) collective freedoms. We must begin to treat freedom as a relativity theory it ought to be.

But our short-term wealth creation is the foolish envy of the world and many other societies copy our model for the same reasons we created ours. So to your question, many countries in the world follow our laissez-faire economics blindly, including some in the East.

About Georges van Hoegaerden

As a Silicon Valley entrepreneur having raised $14M in venture capital and having returned over $100M to investors I noticed a systemic flaw in the way we build systems. And so I gradually evolved my focus from the economics of innovation to the innovation of economics. I completely re-wrote the playbook of economics to serve us all and named it Renewable Economics™.

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