I am concerneded about the harmful effects of democracy that you bring up, but I prefer disenfranchisment as a solution. Preventing people from working is far more harmful than preventing them from voting.
Fact of the matter is that every nation in the world has labor and passport controls. It would be exceptional and unusual for the US to abandon them unilaterally.
The Soviet Union lasted a long time without a free market. Yet nobody would say allowing sellers to choose their own prices is artificial because they've been dictated by the government for decades and that's the normal and natural state of things.
Similarly the market should shift oil and iron from low value places (in the ground) to high value places (e.g. in a steel beam or gas station).
One could (and did) make the same argument you are making in favor of all sorts of bad laws - Jim Crow, Davis Bacon, etc. That suggests your argument is probably invalid.