The debate over whether capitalism or statism is the appropriate economic system has been raging for centuries. But what’s become increasingly clear is that the proponents of the free market are winning the war. Over the years, government monopolies have been suffering at the hands of capitalism’s unstoppable drive for freedom and competition. The most famous example is the Dutch East India Company. After dominating the spice trade for centuries, and working as an effective government-run monopoly, the Company eventually succumbed to the free market.

If you’re like most people, then you’ve probably asked yourself: are government regulations jeopardizing my liberty? The answer is an undeniable yes. Governments, of all kinds, have a long history of creating more regulations in order to limit our liberty, from regulating currencies to violating our freedoms of expression. Historically, governments have used their regulatory powers to stifle competition, create monopolies and shut out newcomers with costly and repetitive regulations. We can look at the United States’ 1800s railroad industry as an example; when the railroads were initially being built, the government adopted regulations which caused the rate of building to fall far below the critical rate needed to establish a comprehensive, national railroad network.

The problem with command economies is the inherent lack of initiative and innovation. Because of the uniform and rigid guidelines imposed by the government, citizens lack the motivation to explore creative solutions and ways to innovate. This problem has been observed throughout history - from Louis XIV’s France to today’s China. In 18th century France, where the king was absolute, royal command was the primary source of direction for the government, economy, and citizens.