Reforming the Industrial World Ch. 9 Sec 4

I. The Philosophers of Industrialization A. Laissez Faire Economics 1. Laissez Faire let owners of industry & business set working conditions w/o govt. interference 2. This policy was a French philosophy of the Enlightenment-also felt free trade would allow the economy to prosper

A. Laissez Faire Economics 3. Adam Smith a professor at the University of Glasgow defended this position & wrote a book called the Wealth of Nations 4. Believed in 3 natural laws-Law of self interest, law of competition, Law of supply & demand

B. The Economists of Capitalism 1. Thomas Malthus & David Ricardo also supported these theories 2. They opposed govt. efforts to help the poor workers & thought creating minimum wage laws & better working conditions would upset the free market system

B. The Economists of Capitalism 3. Capitalism is the economic system in which the factors of production are privately owned & money is invested in businesses to make profit

II. The Rise of Socialism A. Utilitarianism 1. The idea of socialism based on the belief that govt. or the wealthy should intervene to make people’s lives better 2. Utilitarianism-a philosophy by Jeremy Bentham believed that people should judge ideas, institutions, & actions based on their usefulness

A. Utilitarianism 3. Argued that govt. should try to promote the greatest good for the greatest number of people 4. John Stuart Mills led this movement in 1800s calling on govt. to have companies share the profits more equally with the ordinary working people

II. The Rise of Socialism B. Utopian Ideas 1. British factory owner Robert Owen founded a cooperative community called New Harmony in Indiana w/ the ideas of creating a perfect working place with equality

II. The Rise of Socialism C. Socialism 1. Charles Fourier & Saint-Simon came up w/ an economic system called socialism which meant that factors of production are owned by the public & operate for the welfare of all

II. The Rise of Socialism C. Socialism 2. Believed that if govt. controlled factories, mines, railroads they could end poverty & promote equality

III. Marxism: Radical Socialism A. The Communist Manifesto 1. Karl Marx wrote The Communist Manifesto which was a radical type of socialism 2. Broke down the social classes into the bourgeoisie (employers/haves) & the proletariat (workers/have nots)

III. Marxism: Radical Socialism A. The Communist Manifesto 3.According to Marx & Friedrich Engles the I.R. enriched the wealthy & impoverished the poor

III. Marxism: Radical Socialism B. The Future According to Marx 1. Believed that the proletariat would revolt & seize the factories & mills & produce what was needed 2. Govt. would wither away as a classless society would develop

III. Marxism: Radical Socialism B. The Future According to Marx 3. Then pure communism would take place; meaning all production would be owned by the people

IV. Labor Unions & Reform Laws A. Unionization 1. A union spoke for all workers in a particular trade-membership is voluntary 2. If owners refuse to meet their demands union members would strike-refuse to work

IV. Labor Unions & Reform Laws A. Unionization 3. At first govt.’s refuse to acknowledge unions because they saw them as a threat to social order

IV. Labor Unions & Reform Laws B. Reform Laws 1. Britain’s parliament passed the Factory Act of 1833 which made it illegal to hire children under the age of 9; 9-12 could only work 8 hrs, 13-17 only 12 hrs a day 2. The U.S. did the same but the Supreme Court overruled the decision & left it up to state law