Laura asks, in her article, Evolution of Government and Why Libertarianism Doesn't Work, what type of government libertarians envision. To answer that we must first address the question of what IS government.
To a libertarian, government is any organization that claims the right to use initiatory force against those it governs in order to gain compliance with its policies. It is this non-defensive use of force that distinguishes a government from a voluntary social structure such as the early communal organizations she describes.
What type of organization this will be therefore depends entirely on who controls the use of that force. I'll just call them the good guys or the bad guys for now. Obviously what Laura wants is a world where the good guys control this force. Unfortunately the bad guys are highly unlikely to abandon their quest to control it instead. The bad guys also have a more concentrated interest in seizing power than the general populace has in resisting. The gains they stand to reap usually outstrip the potential loss to each individual that would be hurt by their exercise of that power. What most people want is just to go about their daily lives perusing those values they hold dear for whatever reason they hold them dear. They tend to worry about Genghis Khan only when he is at their gate.
Lets also not forget that power corrupts. Many people, as they say, go to Washington to do good and end up doing very well. It is easy to fall prey to the belief that what is good for me is good for everyone so I should make sure everyone gets what I believe is good. Libertarians want people to be able to pursue their own vision of good so long as they refrain from using force to prevent others from following a different vision. Libertarianism, as strictly a political philosophy, does not presume to define the good. We believe that when force is removed from the equation that those ideals which bring betterment to the human condition will naturally win out.
Now lets move on to some of her fallacies. She claims that if it weren't for minimum wage laws salaries would be driven to subsistence levels. Why then are so many people, the vast majority of the population in fact, able to command salaries far above the mandated minimum wage? The reason is obviously that there is competition for their services. Laura's scenario presumes that jobs themselves are finite while the labor force is expanding. But when the government does not place obstacles, that is regulations, in their path businesses create new jobs all the time. Human want, as opposed to need, is insatiable and there will always be those who think they can make a buck by satisfying those wants.
What the minimum wage does do is raise the entry level requirements for any job. No employer is going to pay ten dollars an hour for someone they perceive as only being worth eight dollars of productivity. Thus the experienced worker will always be hired at the expense of those seeking a true entry level position. The statistics on this are incontrovertible. Every increase in the minimum wage has correlated with an increase in teenage unemployment.
What about her claims that large organizations will monopolize resources and collude to prevent competition. There is no question that they would like to do this but can they really get away with it? Libertarian (particularly Austrian) economics says they can't. Obviously I can't do a thorough job explaining that here so I'll just state that as long as there are no government mandated barriers placed in the way of market entry there are only two possibilities. If a company is using their overwhelming market share to raise prices way above production costs there will always be others who believe they can take some of that share away by selling for less
Yes, the big guys could then drop their prices below cost to drive a competitor out of business but the consumer will be the winner then. As soon as they try to jack up prices again a new competitor will emerge and the price war will resume. Eventually the big guy will go broke or be forced to sell at a realistic profit level. Even if they start by selling at a reasonable profit margin, the second possibility, they will always have to contend with the entrepreneur who believe he can lower production costs and thus sell more cheaply even with the same profit margin.
The history of South Africa also shows
how government uses it coercive power to prevent minority populations
from gaining equality. Basically any place that black populations
were able to adjust to the cultural changes brought about by white
imperialists the government was forced to pass laws which prevented
them from competing on an equal basis. These laws, which ultimately became known at apartheid, took various forms
such as land confiscation and bans on the purchase of land. Before
these "reforms" groups of black farmers were actually doing quite
well in some areas competing against their white neighbors.
And here at home it was the Jim Crow laws that institutionalized racism. A rational business person knows that limiting your market is bad for business. Only when all businesses have to follow the same limits can a new supplier be prevented from competing with the bigots.
So in summary all those evils that Laura sees as occurring in a libertarian society, libertarians see as a direct result of government using its power of initiatory force. The goal of libertarianism is thus to limit as much as possible the areas in which that force can be applied. To some that means staying within the literal confines of the Constitution. The more extreme seek the complete removal of that force and therefore support anarchy in it's literal meaning -- the absence of government.