Who’s the man with the economic plan? Adam Smith vs Karl Marx Who’s the man with the economic plan?

Adam Smith individuals own the means of production (factories, machines, land) and reinvest profits as capital to expand business Capital – wealth that is invested in order to create more wealth

Adam Smith- The Wealth of Nations Laissez-faire- (let do) non-interference of the government in business HANDS OFF!

Capitalism Free Market Economy – One in which consumer choice, the law of supply and demand and competition drives companies decisions regarding what products to produce and the prices of those products.

Adam Smith 3 Laws Law of Competition

Law of Self Interest

Law of Supply and Demand

Socialism a theory or system of social organization that promotes: that the community as a whole should own and control of the means of production (factories / land) profits from production should be divided amongst the community as a whole

Socialism Continued Believe capitalist take advantage of workers Community or state (gov’t) must act to protect workers Unequal distribution of wealth is unfair (caused by capitalism) Goods should be divided according to each person’s needs

Karl Marx and Freidrich Engels The Communist Manifesto Haves Have-nots Patrician Plebeian Noble Serf 1st & 2nd Estates 3rd Estate Bourgeoisie Proletariat

The New Struggle Bourgeoisie = owners of business, capital and means of production Proletariat = working classes, own nothing

Karl Marx (and F. Engels) The Communist Manifesto Radical Socialism or Marxism Workers will seize control of the government and businesses

“Dictatorship of the Proletariat” Workers would take control of the government

Then what… redistribute profits equally own all property in common (no private property)

Socialism  Communism “From each according to his ability, to each according to his need” (all must work, all share in profits) Economic equality (no more classes) No government or police would be needed in a community of equals where all is shared government would fade away  Communism

“Communist” Countries Today “Communism” = Dictatorship never moved passed Marx’s Dictatorship of the Proletariat stage Examples Former USSR (Soviet Union) China Cuba North Korea

Socialist Countries Today Tend to be democracies Major Industries owned by the people (Railways, Telephones, TV stations etc.) Government taxes provide benefits to all citizens (healthcare, free higher education, pensions (retirement), Social security Examples: France, Canada, England

What system would they support? For the following people decide whether they would support: Socialists - All means of production and all profits are owned by the community together (Owen, Marx) Laissez-Faire Capitalism - Government should keep its hands off business and allow owners to act in their own self interest to seek profit (Smith, Malthus and Ricardo)

Donald Trump If you don't make him a profit “YOU'RE FIRED!”

Robin Hood Robs from the rich and gives to the poor (ie redistribution of wealth).

Papa Smurf Leads a self-sufficient community of little blue people living in harmony. All members of the community work together to meet their needs. All have an equal share.

Gargamel He is in constant pursuit of wealth and doesn't care how many little Smurfs had to die to make him rich. In fact he thought he could turn Smurfs into gold...hmmmmm…