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Chapter 7 Section 4 New Ways of Thinking Mr. Bellisario Woodridge High School October 10 & 11, 2013.

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Presentation on theme: "Chapter 7 Section 4 New Ways of Thinking Mr. Bellisario Woodridge High School October 10 & 11, 2013."— Presentation transcript:

1 Chapter 7 Section 4 New Ways of Thinking Mr. Bellisario Woodridge High School October 10 & 11, 2013

2 Lesson Objectives Describe laissez-faire economics and the beliefs of those who supported it. Summarize the theories of socialism. Explain Karl Marx views of the working class and the response to Marxism.

3 Laissez Faire Economics Physiocrats Believed government should not interfere in the free operation of economy Early 1800’s middle class business leaders embraced “hands-off”

4 Laissez Faire Economics Adam Smith Wrote, Wealth of Nations (1776) Believed in a free-market economy, no government intervention Unregulated exchange of goods & services – would come to help everyone, not just the rich Produce more goods at lower prices, making them affordable to everyone Encourage capitalists to reinvest profits in new business

5 Laissez Faire Economics Thomas Malthus Population would grow more than food supply Checks on population – War – Disease – Famine Urged families to have fewer children

6 Malthus’ Basic Theory

7 Laissez Faire Economics David Ricardo “iron law of wages” When wages are high, families have more kids – This meant a greater labor force – Led to lower wages & higher unemployment

8 Both Malthus & Ricardo felt… Individuals should improve their lives through: – Thrift – Hard work – Limiting family size

9 Utilitarians Goals - of society should be the greatest happiness for greatest number – Jeremy Bentham & John Stuart Mills

10 Utilitarians Actions/laws are right if they bring happiness, wrong if they bring pain Wanted government to help improve lives of working class Factory workers – Had right to increase their own happiness – Government should step in when owners’ happiness hurt workers Responsible for reforms from child labor to public health – But did not change society greatly – Goal was to end poverty & inequality

11 Socialism People, as a whole, would own means of production (factories, farms, natural resources, transportation, etc., needed to produce goods) Condemned (hated) capitalism (individuals own means of production)

12 Utopians Early socialists – Built self-sufficient communities – Everything owned in common – All work shared

13 Socialism Robert Owen Selected New Lanark, Scotland as model village & factory, based on cooperation – Limited child labor – Encouraged labor unions – Homes for workers – Schools for children – Still able to make a profit

14 Communism Introduced by Karl Marx & Frederick Engels Communism – radical form of socialism A German socialist-philosopher & German socialist whose father owned textile factory in England – Communist Believe A very few wealthy individuals controlled a majority of poor Felt Utopians were unrealistic

15 Karl Marx Wrote Communist Manifesto (1848) Saw class struggle between bourgeoisie (middle class) and proletariat (working class) as unavoidable Marxism: – “Haves” (capitalists, bourgeoisie) always owned means of production & controlled society & wealth – “Have nots” (poor, working class, proletariat) would take control of means of production & set up a classless communist society by overthrowing the “haves”


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