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I know plenty of small businesses. I know none that keep to one person and aren’t disguised employees.
But then, if there are two persons in your business, who’s the boss? And if there’s none, congrats, it’s a cooperative!
Employment is something workers won in the early 20th century. Ask yourself why they fought for it maybe. Then come back with your arrogance.
The government in 1700 didn’t have as strong of a grasp on the military as it does now. And the police kind of didn’t exist in this time. The biggest inventions of the 20th century are mass surveillance, repression, and propaganda. An armed force being able to go from one side of the country to the other in a few hours is also a strength for government stability.