1. New Ways of Thinking in the Industrial Revolution The rise of Socialism

2. View Chapter 7, Section 4 (pages 260- 265) and understand what YOUR economist believed was the IDEAL form of government and economics. What role should government play in their economic system, and why? Adam Smith ( p. 186) Thomas Malthus David Ricardo Jeremy Bentham Karl Marx SOCIAL DARWINISM (not Darwin's biology theories, but how they related to business!)

3. NOT EVERYONE was HAPPY with the changes the Industrial Revolution brought! Neal Ludd and the "Luddites," or, what Mrs. Z will call her band someday

4. Adam Smith and "Laissez-Faire" Wrote, "The Wealth of Nations," 1776 Scottish economist, Enlightenment-inspired "Invisible Hand" and competition/laissez-faire and free market Modern CAPITALISM is credited to Smith!

5. Thomas Malthus Bleak view of factory system Only checks on population growth were “nature’s natural methods” of war, disease, and famine Views proved WRONG!

6. David Ricardo Another laissez-faire economist Believed in the “Iron Law of Wages” Opposed any government help for the poor Hard work and limiting size of families

7. Jeremy Bentham and Utilitarianism Goal of society should be “greatest happiness for greatest number” of citizens Laws should be only if they are USEFUL Influenced John Stuart Mill, who wanted laws to protect workers

8. ANY “LOST” FANS IN THE HOUSE??? John Locke as "Jeremy Bentham"

9. Socialism The people as a whole—NOT individuals—own the means of production Karl Marx and Friedrich Engels, The Communist Manifesto 1848 Communism: Creation of a classless society

11. Communism vs. Capitalism? Communism Democratic Capitalism (USA) Class struggle  Proletariat vs. Bourgeoisie  VIOLENT REVOLUTION  Everyone is EQUAL, GUARANTEED MUST stay put  No trade  No personal freedoms  Many social classes Class MOBILITY MUCH INEQUALITY  NO guarantees!  Able to have personal freedoms and choices

12. Different kinds of ECONOMIES EMERGE! Market: buyers and sellers make the main decisions. Individuals exchange things! SUPPLY and DEMAND, SELF- INTEREST, and COMPETITION are main points. Laissez- faire, and virtually NO control by government. Freedom for consumers to purchase/create, but sometimes large gap between rich and poor. Centrally Planned: Central government--NOT individuals!-- makes key economic decisions. Also called a command economy, a socialist economy, or COMMUNISM. Government controls the MEANS OF PRODUCTION. Often results in poor quality goods and shortages. Mixed Economy: both free enterprise AND socialist characteristics. Government controls the center of economic power. Most are democracies, but require a large amount of central planning to achieve economic equality. Most countries fall in this range today!

13. SOCIAL DARWINISM: or, how some tried to act like plants are TOTALLY the same thing as people Charles Darwin: Theory of evolution, his 1859 book "On the Origin of Species" was related to his trip around the world by boat. Why did some species ADAPT? "Only the strong survive." SOCIAL DARWINISTS attempt to apply this to people! This will take on a racist undertone as we approach the 20th century.