• Learning Objective:–Today I will be able to compare

socialism and capitalism by creating a T-chart to write a small summary.

• Agenda1. Learning Objective2. Lecture: 9.4 Reforming Industrial3. T-Chart4. Exit Slip

Title Notes: Ch. 9.4 Reforming Industrial Revolution

• Laissez faire= free trade (gov. hands off)– Belief that without gov.

interference, economy prospers.– Such belief came from French

Enlightenment philosophers.• Adam Smith:– Supports laissez-faire– Book, “The Wealth of Nations”

(1776)

• 3 natural laws of economics (Adam Smith):1. Law of Self-Interest • Ppl. Work for their own good

2. Law of Competition• Competition makes better

products

3. Law of Supply & Demand• Enough goods at lowest price

meets demand.

• Capitalism= factors of production privately owned, makes profit.– Factors of production= Land,

Labor, & Capital (wealth)

Checking for Understanding

• What is laissez-faire?

• What is capitalism?

• What is similar & different about each economic system?

• Laissez-Faire/Capitalist Ideas:• Thomas Malthus argued:– Population increases faster than food supply increases– Poor are destined to be poor.

• David Ricardo– PPl. Are always gonna be poor.– High population + Low resources/work=cheap labor.

• Smith, Malthus, Ricardo:– Opposed gov. actionmin. wage & better working

conditions.– Believed gov. will upset free market.

• Utilitarianism– Individual freedom to pursue economic advantage, without

gov. interference.– Jeremy Bentham modified Smith’s ideas– “Greatest good for greatest # of ppl.”

• Gov. support & control of this idea

– John Stuart Mill• Questioned unregulated capitalism (laissez-faire)• Supported working rights, women’s rights, etc.

Checking for Understanding

• Identify two ideas that support laissez-faire and capitalism

• Define utilitarianism.

• Socialism=factors of production owned by public, benefits public.

• Karl Marx & Friedrich Engels– “The Communist Manifesto”– Bourgeoisie “haves” ---- Middle Class– Proletariat “have nots” --- Poor & Working class– Prection: Workers will overthrow the owners.

Checking for Understanding

• Who are the bourgeoisie?

• Who are the proletariat?

• Marx believed the capital system will fail and workers will take control.

• Communism: complete socialism, factors of production owned by ALL ppl.

• Gap between rich & poor.• Influences revolutions for socialism/communism.• Influences revolutionaries:

– Lenin, Russia– Mao Zedong, China– Fidel Castro, Cuba

• Unions & Strikes:– Factory workers faced long hrs & dirty/dangerous

conditions.– Workers joined together in group to fight for less hrs &

safer working conditions– Refused to work until demands are met.

• England: Combination Acts of 1799• Outlawed unions and picketing (strike)• 1824, repealed

•1875, British unions legally are able to strike/picket peacefully•1886, American Federation of Labor (AFL)• Won higher wages & shorter hrs.

– 1904, National Child Labor Committee (USA)• Ends child labor

•Abolition of slavery:• 1807, ends slavery British in West Indies• 1833, ends slavery all over British Empire• 1865, US ends slavery after Civil War• 1873, in Puerto Rico--- 1886, Cuba --1888, Brazil

Checking for Understanding

• What is socialism?

• What is communism?

• What is similar and different about socialism and communism?

Capitalism Socialism

• (1) Define each concept. (2)What is the difference. (3)Provide an example for each. (4) Draw an image that represents each concept.

Exit Slip• Which economic system do you prefer to

have, Capitalism or Socialism? Explain why you chose this.