1. Global II Currents of Thought Ch 22, Sec 1 Pg 495 – 499 New Ideas About Organizing Society What new philosophies emerged for running Society in an Industrialized world?

2. Objectives 10.1Explain the ideas of laissez-faire economics. 10.2Describe the change socialists called for in society. 10.3Discuss the predictions Karl Marx made about capitalism. 10.4Discuss the similarities & differences between Capitalism & Communism.

3. Lesson Launch “The goal of capitalism is always the same” WHO IS THIS MAN GETTING RICH FROM?

4. Explaining Capital

5. Origins of Free Market

6. Laissez – Faire Economics (Capitalism) – Open/Free Market Definition: An economic system in which the government does not interfere with the economy. PRIVATE OWNERSHIP An idea that developed from Enlightenment physiocrats Use natural laws to explain economics Natural Laws = Free-Market Economy

7. Laissez-Faire Supporters Adam Smith (late 1700)’s Wrote the Wealth of Nations Felt that Industrialization benefited everyone No government interference Let law of supply and demand dictate economy

8. Cycle Graph David Ricardo Iron Law of Wages

9. HOMEWORK Capitalism How were the abuses of the Industrial Revolution corrected under the Capitalist system?

10. A cup of java please Say, are those Children working in the kitchen? That’s a Gray Area under new government guidelines Isn’t this an Endangered Species you list on the menu? Used to be, that term no longer has a legal meaning. Yeah the water has a bite to it, since they reformed the Clean Water Act. This coffee tastes Awful. Gee, I think I’m gonna be sick. I may have to SUE. Fat chance buddy, that’s illegal now Oh, well at least business is good!! Talk with the person next to you about this cartoon. What are some of the points it makes about laissez-faire economics? Lesson Launch

11. Capitalists take over

12. Who is represented by the different levels of this pyramid? Who makes up the lowest part of the pyramid?

13. Utilitarianism John Stuart Mill Supports capitalism! Calls for reform Government should take action, when necessary, to protect workers All should have right to vote and education Government action ONLY to correct abuses

14. Modern Capitalism Laissez-Faire Private Ownership Extremely competitive Gov’t Hands-off No REGULATION Social Darwinism “Survival of the Fittest” Utilitarianism Private Ownership Competition Gov’t Regulation Labor laws No monopoly “Actions of few…not cause misery for many” Modern Capitalism Private ownership Healthy competition Gov’t Regulation Worker’s rights protected Adam SmithBentham & Mill

15. Socialism/Communism

16. Socialists Oppose Capitalism Declare Capitalism rewards industrialists (owners) not laborers Workers should own means of production (government ownership) Operated for benefit of all people Eventually split: Socialists – work for change through Democracy Communists(Marxists) – violent overthrow

17. Utopian Socialists Reorganize industry for a new society Set up self-sufficient communities, where all property and work would be shared High wages, comfortable housing, schools, and stores w/ low prices. The community works as a whole to make life better for all

18. Karl Marx & Friedrich Engles “Scientific Socialism” Wrote Communist Manifesto History was a class struggle between the wealthy capitalists and the proletariat, or working class. Always determined by economics In order to make profits, the capitalists took advantage of the proletariat The proletariat would eventually rise up and overthrow the capitalist system, creating their own society The proletariat society would take control of the means of production [Land, Labor, Capital] and establish a classless, communist society, in which wealth and power would be equally shared Haves: Spartans Have-nots: Helots _______________ Haves: Patricians Have-nots: Plebians _______________ Haves: Nobles Have-nots: Peasants GREECE ROME Middle Ages

19. Weaknesses of Marxism 1. Failed to see that Capitalism can change (ex. Modern Capitalism) 2. Did not understand nationalism 3. Marxism comes at the cost of individual freedom 4. There is no “incentive” in Marxism

20. Review!! Please discuss the following with a partner: What are the ideas of Lassiez-Faire capitalism? What are the ideas of Communism? What are the similarities of these two theories? What are some differences between these two theories?

21. Each a response to Industrialization (abuses) Each has roots in Marxism (Karl Marx) Each has gov’t ownership Complete Government Dictatorship Closed/Command Violent Revolution Eliminate Opposition None CommunismSocialism Government Private & Government Democracy Mixed Evolution Economic Fairness Yes…profit/pay increases Economy Ownership Achievement Maintain Power Incentives

22. Ways of Organizing Society Communism (Command Economy) Capitalism (Free-Market) SocialEconomicPolitical Classless society No Freedoms Command Economy Gov’t Ownership (Total) Price Controls Wage Controls Economic Decisions by Gov’t Dictatorship No rights to people SocialEconomicPolitical Class based on $ Social mobility Private Ownership Gov’t Regulation OSHA Democracy Many Rights

23. CLOSURE What are the ideas of laissez-faire economics? What changes did socialists call for? What did Karl Marx think would happen to Capitalism? What are the similarities & differences between Capitalism & Communism

24. HOMEWORK Communism Compare and contrast Communism and Capitalism.