1. EE # 16: Communism What are the problems w/capitalism?

2. Problems w/capitalism

3. Is there a better way?

4. Pure Centrally Planned Market aka Communism
Public (gov) ownership of all resources
Created by Karl Marx (1848) –
Society should share its resources to ensure that the lower classes (workers) are provided for

5. How much money do you have on you right now?!

6. Gov answers … What to produce? How? For whom to produce?
What’s best for nation: capital goods, military technology
How?
Ensure that everyone is working
For whom to produce?
Public
*No competition

7. Visible Hand Consumer goods are rationed (restricted/limited)
Gov decides
Focus on public goods, NOT consumer goods
Consumer goods are rationed (restricted/limited)
In Communist countries – bread lines, years to get a car, better apartment, etc
HAVANA, CUBA: A woman walks with her government ration of bread at a government bakery in the central section of Havana, Cuba. Many staples, like bread, rice and meat are still rationed in Cuba.

8. Is communism better?
Advantages 
Disadvantages 

9. Better?! ADV  : everyone is provided for DIS  : few consumer items
No incentive to work harder – what will you get if you work harder? Inefficient!
Waste – no pride of ownership b/c it’s never your business or money!

10. EE #17: C&C Compare & contrast communism to PURE capitalism
Which one is better and why? Explain 2 specific reasons.