The Industrial Revolution & Communism Mr. Stowinsky World History

Why did the Industrial Revolution begin in England? Large population – lots of workers Growing economy Lots of natural resources Water & coal to power the machines Iron ore to build machines, tools, and buildings Rivers for inland transportation Harbors to import/export Factors of production – land, labor, and capital (wealth)

Industrialization Spreads English engineers, mechanics, and toolmakers were forbidden to leave English and share industrial secrets Some emigrated to the United States and brought theirs ideas and machines with them Industrialization in the US began in textile factories in New England The US remained largely agricultural until after the Civil War As railroads expanded, so did industrialization

The Rise of Corporations Stock – shares of ownership Corporation – a business owned by stockholders who share in its profits but are not personally responsible for its debts Stocks allowed corporations to acquire resources and buy equipment Workers earned low wages for working long hours while stockholders earned high profits, corporate leaders made fortunes

Continental Europe Industrializes The French Revolution and Napoleon delayed the continent from industrializing English ideas were first smuggled into Belgium Germany industrialized but only had pockets of natural resources, making its industrialization more scattered Other parts of Europe industrialized in pockets Parts of Europe could not industrialize due to natural barriers (mountains, etc.) or political issues

The Impact of Industrialization Shifted the world balance of power – increased competition Widened the wealth gap between industrialized and non-industrialized countries Powerful nations (including the US!) began creating colonies and exploiting their resources Imperialism – extending one country’s rule over other lands Eventually population, health, and wealth increased Creation of a middle class meant more education and democratic participation

Reforming the Industrial World Laissez faire – “let it be” – the belief that industry and business should be left alone by government Supported by the three natural laws of economics: Self-interest – people work for their own good Competition – competition forces people to make a better product Supply & demand – enough goods would be produced at the lowest possible price to met demand in a market economy

Capitalism Capitalism – economic system in which the factors of production are privately owned and money is invested in business ventures to make a profit Thomas Malthus – argued the population was outpacing food supply so there would always be poor people David Ricardo – Wages should be forced down as population increased Laissez-faire were against minimum wages and better working conditions, claiming they would lower profits

The Rise of Socialism Some theorists felt wealthy people or the government must intervene with business to improve people’s lives Utilitarianism – the greatest good for the greatest number of people – also pushed for reforms in the legal & prison systems and education Beginnings of company towns, child labor laws, and free schooling

Socialism – factors of production are owned by the public and benefit everyone The government should plan the economy Government control of factories, railroads, etc. would end poverty and promote equality

Marxism & Communism Karl Marx – Marxism – wrote The Communist Manifesto Human society has always been divided into two warring classes Bourgeoisie – “haves” – employers Proletariat – “have nots” – workers The wealthy controlled the means of producing goods, and the poor did difficult work for little pay. This results in conflict. The Industrial Revolution made the rich richer and the poor poorer. Marx said the poor would overthrow the rich

Marx believed capitalism would destroy itself and a classless society would emerge Communism – a form of complete socialism in which the means of production – all land, mines, factories, railroads, businesses – would be owned by the people No such thing as private property All goods and services would be shared equally

Labor Unions & Reform Laws Unions – groups representing workers that negotiate between workers and employers Negotiated for higher pay and better working conditions Strike – when union members refuse to work Unions were usually made up of skilled workers so they had more bargaining power Reforms included limiting lengths of work days and child labor laws

The Reform Movement Spreads England abolished slavery in 1833. The US ended it in 1865. Spain and Brazil followed in the 1880’s. Women’s rights movements began – demanded the same pay as men – usually only made 1/3 of what men did Public education systems were set up in the US and Europe Prison systems were reformed