1. Economic systems

2. Background
Industrial Revolution opened a wide gap between the rich and poor. Different ideas emerged on how to handle the wealth generated from the Industrial Revolution

3. Capitalism, Communism, and Socialism

4. What is capitalism? Capital=MONEY Businesses are privately owned
Money is invested in business to make a profit
Law of self-interest: people work for their own good
Competition is encouraged
Government should not interfere in economy 4

6. Adam Smith Adam Smith is “the” capitalist
Wealth of Nations: capitalism good for society
Laissez faire: let the people do as they please 6

7. What’s good about capitalism?
Freedom, choice.
You can work wherever, buy whatever, and pretty much do whatever.
If you’re successful, you can be very successful. Think Bill Gates, Papa John, Mark Zuckerberg
Answer the question in your notes
Who would support capitalism and why? 7

8. What’s bad about capitalism?
No “safety net”: government can’t interfere to help
During Industrial Revolution, factory owners took advantage of workers
If you’re unsuccessful, you can be very unsuccessful
Big gap between rich and poor.

9. What is Socialism? Midpoint between capitalism and communism
State owns property and helps to distribute goods more evenly

10. What is communism? IN THEORY
A form of complete socialism in which everything would be owned by the people
Private property would cease to exist
All goods and services would be shared equally
Government would cease to exist as a classless society develops 10

11. What is communism? IN PRACTICE Joseph Stalin
Country is controlled by dictator
Government takes control of all private property
Government picks your job
Government distributes only what you need
housing, food, education, health care
Distribution of goods is equal (depending on size of family)
EXCEPT top ranking members of the communist party; they get whatever they want
All freedoms are taken away

13. Karl Marx Karl Marx is “the” communist
The Communist Manifesto: 1848, class struggle, problems of capitalism
Das Kapital: 1867, critique of capitalism
Both written with Frederich Engels 13

14. What’s good about communism?
Basic needs met
Everyone would have a job, house, health care, etc.
Answer the question in your notes
Who would support this idea? 14

15. What’s bad about communism?
Lack of choice
No reward for being a better worker or punishment for being a slacker
Everyone expected to be the same (lack of focus on individual growth).
watch?v=9uGv1L3opb4 15

16. How’s this related to the Industrial Revolution?
Adam Smith’s capitalism dominated the IR- Led to bad working conditions.
Karl Marx wrote about communism as solution to capitalism’s problems.
Marx said the workers would get fed up and overthrow their governments and start communism.
Eventually, workers won more rights to due unions and reform laws created by the government 16

17. Answer the following question in your notes
Which economic system do we have in the United States? Support your answer with examples.
Capitalism Socialism Communism

19. Read the Connect to Today on pg 738 and answer the following questions
1.How many communist countries existed during the peak of communism (1980s)
2. How many communist countries still exist today, and what are they?

20. Other possible videos https://www.youtube.com/watch?v=5xgwYRX19VU