Reforming the Industrial World 9.4 Part I

 Laissez-faire: Economy and its market that functions w/o gov’t regulation or intervention  “let it be” in French The Philosophers of Industrialization

 Grew from the Enlightenment era  Thought that gov’t tariffs on foreign goods interfered w/ the production of wealth  Free trade w/o gov’t intervention = economy would prosper Laissez-faire Economics

 Adam Smith’s Wealth of Nations (1776)  Argued that economic freedom guaranteed economic progress ∴ gov’t should not interfere  Smith backed his argument using the 3 natural laws of economics: 1.The law of self-interest – ppl work for their OWN good 2.The law of competition – competition drives companies to produce a better product 3.The law of supply and demand – enough goods supplied at the lowest possible price to meet the market demand Laissez-faire Economics

 Smith’s ideas were the basis for the economic system called capitalism:  Economic system where the factors of production are privately owned + industry are controlled by private owners for profit, rather than by the state.  These ideas helped to bring about the industrial revolution. Capitalism

 Thomas Malthus: An Essay on the Principle of Population (1789)  Argued that the population increased faster than the food supply ∴ wars/epidemics needed to kill off the extra ppl who would be poor and starve  David Ricardo: Principles of Political Economy and Taxation (1817)  Believed that there would always be a poor lower class  In a free market, the abundant # of workers and resources means labor and supplies are cheap  ∴ as population increased, wages would decrease (law of supply and demand)  Believed that gov’t should NOT intervene to help the poor working class b/c it would upset the free market system Other Industrial Revolution Economists

 Jeremy Bentham introduced the philosophy of utilitarianism in the late 1700s:  Ppl should judge ideas, institutions, + actions on the basis of their utility, or usefulness.  Promote the greatest good for the greatest # of ppl  Pursue goals w/o gov’t intervention for the most part Utilitarianism

 John Stuart Mill – led the 1800s utilitarian mvm’t  Started questioning capitalism  felt that workers should be allowed better lives  Started pushing for reforms in the work place, with women’s rights, of the prison system, education  Sought to close the wealth gap Utilitarianism

 Utopia  the “perfect” society  British factory owner, Robert Owen, aimed to improve working conditions for his workers  Built houses near his factory in England that could be rented at very low costs  Provided free schooling + did not allowed children under 10 to work.  Built a similar community in the U.S. + called it New Harmony, IN Utopian Ideas

New Harmony, IN

 Other theorists like Chalres Fourier and Saint-Simon, argued that the gov’t should intervene to improve ppl’s lives  Solution  Socialism:  Gov’t ownership of the factors of production to get rid of the ills of industrialization  Optimistic view of human nature  Gov’t should plan and regulate the economy and own all industries ∴ business owners can’t take advantage of workers The Rise of Socialism

 Karl Marx: German journalist who introduced the world to Marxism  Together, Marx and Frederich Engels outlined their ideas in The Communist Manifesto  Written in response to the horrendous conditions in factories  Blamed the system of industrial capitalism for the terrible conditions  Their solution to problem was a new social system- eventually known as communism Marxism

 Argued that all of history was a “history of class struggles”  Oppressors vs. oppressed is a constant throughout history  Oppressors: “Haves,” own means to production  Land, raw materials and money  Oppressed: “Have nots,” dependent on the owners of the means of production, endured back breaking work while oppressors became wealthy.  “Society as a whole is more and more splitting up into two great hostile camps, into two great classes directly facing each other: Bourgeoisie and Proletariat.”  Bourgeoisie- the middle/upper class (oppressors).  Proletariat-working class (oppressed). The Communist Manifesto

 Believed that the capitalist system would destroy itself.  Struggle between proletariat + bourgeoisie will eventually lead to a revolution.  All small companies would be driven out of business + a small # of big companies would control all wealth.  BUT proletariat would then overthrow bourgeoisie  Take control of the factories + abolish economic differences that create separate social classes  -End up with a classless society and no gov’t The Future According to Marx

 Marx: Pure communism is when all means of production are controlled by all of the ppl  There would be no ownership of private property  All land, factories, mines, railroads, business etc would be owned by all of the ppl  All goods and services shared equally Communism

 Labor Unions and Reform Laws  The Reform Movement Spreads 9.4 Part II

 By the 1800s workers were getting into politics  Started to form labor unions:  Voluntary labor associations used to express the collective concerns of the labor population Labor Unions and Reform Laws

 Union spoke for ALL workers in a particular trade  Engaged in collective bargaining:  Negotiations b/w workers and their employers  Worked for better working conditions and pay  When factory owners refused to cooperate union member could go on strike:  Collective refusal to work until negotiations are reached  Skilled workers led the union mvm’t b/c they had more bargaining power. Unionization

 Slowly unionization picked up in G.B. and the U.S.  BUT  Combination Acts of 1799 and 1800  Outlawed unions + strikes in Great Britain  British factory workers unionized anyways, Combination Acts finally repeal in  Gained ground in wage increases, better working conditions, and shorter hours over time.  Same in U.S. Unionization

 Labor unions forced gov’t to look into the abuses that industrialization caused  The British Parliament started looking into child labor and working conditions in mines  Factory Act 1833:  Made it illegal to hire children under the age of 9  ages 9-12 couldn’t work over 8 hrs  couldn’t work more than 12 hrs  Mines Act (1842):  Children + women couldn’t work underground. Reform Laws

 From the beginning of the IR, reform mvm’t rose in response to the poor working conditions  Seeking the right to vote for working class men and women in general  Sought an end to slavery The Reform Movement Spreads

 William Wilberforce (member of Parliament) led the abolition mvm’t in England  Parliament passed a bill in 1807 to end the slave trade  1833 Britain abolished slavery completely w/ the Slavery Abolition Act of The Abolition of Slavery

 Earned higher wages than work they did at home  BUT only earned 1/3 the salary as their male coworkers  Worked for the abolition of slavery and to gain voting rights The Fight for Women’s Rights