The term “laissez-faire” is an economic term that protects private enterprise from government intrusion. The phrase comes from the French, and is generally translated as “leave it alone.” It was first attributed to a 1680 meeting between legendary French finance minister Jean-Baptiste Colbert and business leaders.
Laissez-faire, as a business idea, spread to England during the Enlightenment. Adam Smith, famous for The Wealth of Nations, believed that a laissez-faire system promoted free markets and natural liberty, although he did not use the term in his writing.
As an economic principle, laissez-faire has four basic assumptions. The first is that the individual is the most basic unit in society. Second, the individual has a fundamental right to freedom. Third, the physical order of nature is both harmonious and self-regulating. Fourth, corporations are constructs and must be supervised by the citizen due to their propensity to disrupt the natural order.
Laissez-faire in the United States during the Industrial Revolution led to the rise of the massive monopolies that characterized the Gilded Age. Business regulation now marks the US economy as a mixed economy, characterized by government control over several key areas of the economy, as well as consumer protection from corporate abuse.