Changing the Industrial World Why did Capitalism cause reform movements?

I. Laissez-Faire Economics/Capitalism A. Laissez-Faire is an economic philosophy that allowed owners to set working conditions w/o interference from the govt. 1. Adam Smith defended Laissez-Faire in his book The Wealth of Nations a. argued a free-market, w/ no gov’t regulation would create competition, causing better products & wages b. Prices would be regulated by supply & demand 2. Smith’s ideas become known as capitalism B. Others argue unregulated capitalism will not protect workers & encourages greed Poor workers Adam Smith Capitalist Rich Owners

II. Utilitarianism Utilitarians founded by Jeremy Bentham, argued we should judge ideas on usefulness & create greatest good for greatest number 1. Utilitarians said gov’t should regulate capitalism (benefit the most people) B.1830s: John Stuart Mill takes over Utilitarian movement 1. Mill writes about happiness & harm principle a. gov should promote things that create greatest happiness and regulate harmful things b. unregulated capitalism is not creating happiness but harm to the workers 2. To fix the problem, Mill felt the gov’t should create an equal division of profits 3. favored women’s rights, education reform & prison reforms John Stuart Mill

III. Utopianism British factory owner Robert Owen was shocked by the misery and poverty of the working class 1. Built houses near his factory and rented them out to his workers for low rates 2. prohibited children under 10 from working in the factories and provided free schooling B. 1824: Owen traveled to the US and tried to set up a Utopian system in New Harmony, Indiana but it only lasted three years Robert Owen Utopian