: : Nevertheless, I see laissez-faire capitalism to be an impossibility, given that larger capitalists would quickly invent a state to expand and perpetuate their wealth, be it company goons or a more formal structure like those currently existing. After all, the most efficient way for one to extract maximum profit is to either eliminate the competition or somehow regulate the competition. Any replies?
: The pre-Civil War US was very close to true laissez-faire capitalism. Laissez-faire does not require the absense of government; rather, it requires no government regulation or control of the economy. What you are actually arguing is that a stateless system can't last, reguardless of its economic system.
Actually I disagree. First, the Civil War was fought primarily on the disagreement between federal and state jurisidiction. The slavery issue was an agenda by Lincoln to divide the South as no mention was made in his Emanicipation Proclamation of freeing slaves in states not ceding from the union. The federal government favored industry in the North, and state sovereignty favored plantations in the South.
Furthermore, the territory the U.S. "acquired" was the result of government intervention either by territorial purchase (Louisiana), war (Mexican War), of wholesale genocide of numerous Indian tribes. This "government" policy was prompted by wealthy men who had a great deal to gain by the natural resources (READ: commodities) to be gained by the rich mineral deposits in the Appalachians, the lush farmland along the Mississippi, and the gold prospect in California.
Additionally, most of the political and economic power were restricted to white males, excluding African Americans, women, Native Americans, and often poor white males from this wonderful "nearly laissez-faire" system you idealize.
And what about tenant revolts and strikes squelched by state national guards working on behalf of property speculators and early industrialists?