Economic and Social Economic and Social Goals of the United Goals of the United

StatesStates

Benchmarks- did the system meet Benchmarks- did the system meet the needs of the people?the needs of the people?

The Seven GoalsThe Seven Goals

1. Economic Freedom1. Economic Freedom 2. Economic Efficiency2. Economic Efficiency 3. Economic Equity3. Economic Equity 4. Economic Security4. Economic Security 5. Full Employment5. Full Employment 6. Price Stability6. Price Stability 7. Economic Growth7. Economic Growth

Trade-OffsTrade-Offs

What goals might conflict with one another?- What goals might conflict with one another?- Discuss trade-offs among goalsDiscuss trade-offs among goals

What characteristics does the United States’ What characteristics does the United States’ economy have that allows it to resolve economy have that allows it to resolve conflicts among goals?conflicts among goals?

Rank the economic and social goals in order Rank the economic and social goals in order of importance to you. Justify your rankings. of importance to you. Justify your rankings.

Pres. ReportPres. Report

Capitalism and Capitalism and Free Enterprise!Free Enterprise!

Capitalism- a system Capitalism- a system in which private in which private citizens own the citizens own the factors of productionfactors of production

**THRIVES on **THRIVES on competition**competition**

Describes US’s Describes US’s economyeconomy

Free Enterprise: Free Enterprise: competition allowed competition allowed to flourish to flourish w/minimual gov’t w/minimual gov’t interference interference

Also describes US’s Also describes US’s economyeconomy

Adam Smith, 1723-1790Adam Smith, 1723-1790

Father of modern Father of modern capitalismcapitalism

Wealth of Nations Wealth of Nations (1776)(1776)

Predicted the US Predicted the US economy would be economy would be the most successfulthe most successful

““Invisible Hand”Invisible Hand” ““Laissez Faire”Laissez Faire”

Characteristics of a Free Characteristics of a Free Enterprise EconomyEnterprise Economy

Economic FreedomEconomic Freedom Voluntary ExchangeVoluntary Exchange

Act of buyers and sellers freely/willingly Act of buyers and sellers freely/willingly engaging in market transactionsengaging in market transactions

Private PropertyPrivate Property People have right to control possessionsPeople have right to control possessions

Profit MotiveProfit Motive Profit: better off at endProfit: better off at end Profit Motive: drive that encourages well-beingProfit Motive: drive that encourages well-being

Refer to pg. 44 for a pictureRefer to pg. 44 for a picture

The Role of the The Role of the Entrepreneur Entrepreneur

Organizes and Organizes and manages land, labor, manages land, labor, and capital to seek and capital to seek profitprofit

Most importantMost important ““Own boss”Own boss”

Dream too great to Dream too great to resistresist

The Role of the Consumer The Role of the Consumer

““Consumer Consumer Sovereignty” – Ruler Sovereignty” – Ruler of the marketof the market

““Customer is always Customer is always right”right”

Controls what is Controls what is producedproduced

Role of the GovernmentRole of the Government

All levels play a role All levels play a role that reflect goals and that reflect goals and desires of citizendesires of citizen ProtectorProtector Provider and Provider and

ConsumerConsumer RegulatorRegulator Promoter of National Promoter of National

GoodsGoods

a. What aspects of the economy benefit when a. What aspects of the economy benefit when an entrepreneur succeeds?an entrepreneur succeeds?

b. How do American consumers express their b. How do American consumers express their wants?wants?

c. Explain the role you as a consumer must c. Explain the role you as a consumer must play in obtaining economic equity for yourself.play in obtaining economic equity for yourself.

d. What incentive does owing private property d. What incentive does owing private property give people? give people?

DebateDebate

““Government should Government should do for the people do for the people what they wish to what they wish to

have done by have done by cannot do as well or cannot do as well or

at all in their at all in their individual individual

capacities.”capacities.”