2. RESPONSES TO INDUSTRIALIZATION: The “isms”

3. COMMUNISM CAPITALISM CLASSICAL LIBERALISM CLASSICAL LIBERALISM “SCIENTIFIC SOCIALISM” (MARXISM) “SCIENTIFIC SOCIALISM” (MARXISM) Karl Marx Adam Smith Thomas Malthus David Ricardo Friedrich Engels

4. Definitions Capitalism : An economic system that is controlled by private individuals who invest excess money and profits (capital) into business. The goal is profits. The government follows a laissez-faire system where they don’t intervene in economic affairs. Socialism: An economic system that is controlled by the workers inside the factories and directed not by owners but by a centralized government planning committee. The goal is to make the people who do the work more powerful than the owners of the factories. You can still make more money based on how productive (or unproductive) you are. The government intervenes a lot. Communism: Like socialism, but the goal is complete equality of condition. (Instead of equality of opportunity)

5. Capitalists

6. Adam Smith

7. First describer of the economic system of capitalism that was developing in England in the 1700s. Described capitalism in his book On the Wealth of Nations Believed that governments should keep their hands off the economy “Laissez-Faire” Said people’s pursuit of their own interests would result in the right products being made for the right price (because businesses WANT to be profitable!)

8. THOMAS MALTHUS AND POPULATION

9. MALTHUS’S THEORY Food supply increases arithmetically Population increases geometrically STARVATION!

10. MALTHUS’ CHECKS ON POPULATION GROWTH NEGATIVE CHECKS LATE MARRIAGES CELIBACY/ RESTRAINT CONTRACEPTION POSITIVE CHECKS WAR FAMINE DISEASE Growth of population cannot be stopped without “misery or vice”!

11. RICARDO AND THE IRON LAW OF WAGES

12. RICARDO’S CYCLE Population IncreaseGOOD TIMES Higher Wages BAD TIMES Lower Wages Population Decline THE IRON LAW OF WAGES

13. IMPLICATIONS OF MALTHUS & RICARDO’S IDEAS? Low wages Suffering among workers Trying to help poor people would only HURT them long-term: Social Darwinism, or the idea that the “fittest” people should control the world, develops

14. “Philosophers have only interpreted the world in various ways; the point, however, is to change it.” - Karl Marx

15. Karl Marx 1818-1883 Friedrich Engels 1820-1895 Communism:MARXISM

16. History is a series of conflicts between classes that control “means of production” (owners) and those which do not (wage-laborers). vs. Karl Marx said:

17. Society (government, religion, moral values) are ALL designed to support the interests of the dominant economic class. How does the ruling class keep control? Religion “is the opiate of the masses.”

18. COMMUNISM:MARXISM Believed that history is moving through a series of stages … FEUDALISM CAPITALISM SLAVE EMPIRES

19. Industrialization has created a new conflict between the owners of factories (bourgeoisie) and factory workers (proletariat): COMMUNISM: MARXISM PROLETARIAT vs. CAPITALISM

20. Increased suffering among Proletariat would INEVITABLY lead them to revolt against the Bourgeoisie, owners of the “means of production” aka: factories. COMMUNISM: Marxism

21. THE BOURGEOISIE THE PROLETARIAT Uh-Oh

22. Workers would create a society without social classes where no one had any private property and all needs were met. COMMUNISM: Marxism From each according to his abilities, to each according to his needs.

23. “The proletarians have nothing to lose but their chains. They have a world to win. WORKING MEN OF ALL COUNTRIES, UNITE!” THE COMMUNIST MANIFESTO (1848)