Reforming%20the%20Industrial%20World

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Reforming the Industrial World
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Was there a Need for Reform?

• During the 19th century, the Industrial
  Revolution not only revolutionized the way things
  were made, but also created many problems.
• Make a list of the areas of society in which
  reforms were necessary.

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Tensions Created By the Industrial Revolution

• The gap between the rich and poor widened
• Business owners/leaders argued that the
  government should stay out of economic affairs.
• Reformers argued the government needed to play an
  active role to improve the conditions for the
  poor.
• Workers demanded better wages, more rights, and
  protection.
• Workers form labor unions increase their
  influence, often times clashing with business
  owners

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Urbanization

• Significant Population Growth
• Move to the cities--shift of orientation from
  countryside to city.
• Housing, public health, crime, sanitation
• Poor working conditions
• Child labor female labor

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Social Impacts new social classes

• Working class
• Child and female labor
• Working conditions

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Class Consciousness

• Middle Classbourgeoisie
• Working Classproletariat
• Peasant
• Landed Gentryold aristocracy

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The Philosophers of Industrialization their
Economic Philosophies
Philosopher Economic Philosophy
Adam Smith laissez-faire
Thomas Malthus laissez-faire capitalism
David Ricardo laissez-faire capitalism
Jeremy Bentham utilitarianism
John Stuart Mill utilitarianism
Robert Owen utopian socialism
Karl Marx Marxism/communism
Friedrich Engels Marxism/communism
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Laissez-faire

• Term is French in origin let people do as they
  please.
• Economic policy stemmed from the French economic
  philosophers of the Enlightenment.
• The Enlightened Philosophers argued
• against government intervention in the economy
  and the use of placing heavy tariffs on foreign
  goods.
• that government regulations only interfered with
  production and wealth.
• if government allowed free trade, the economy
  would prosper

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Laissez-faire

• Definition of laissez-faire The idea that the
  government should not interfere with or regulate
  industries and business.
• An economic policy of letting owners and business
  set working condition without interference.
• This policy favors a free market unregulated by
  the government.
• What are the advantages/disadvantages of a
  laissez-faire economy?

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Capitalism

• Definition of capitalism an economic system
  based on private ownership and on the investment
  of money in business ventures in order to make a
  profit
• These ideas helped bring about the Industrial
  Revolution and supporters of capitalism believed
  its success was due in part by the fact that the
  government did not meddle in economics.

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ECONOMIC LIBERALISM

• Adam Smith, The Wealth of Nations, 1776
• Laissez-faire economics
• Hidden hand
• Thomas Malthus (1766-1834), Essay on the
  Principles of Population
• Geometric Growth of Population
• Arithmetic Growth of Food Supply
• David Ricardo (1772-1823), Principles of
  Political Economy
• Iron Law of Wages

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Adam Smith

• Professor at the University of Glasgow, Scotland
• Defended the idea of a free economy and free
  markets in his book, The Wealth of Nations
  (1776)
• Economic liberty economic progress
• Believed the government should not interfere with
  the economy

Adam Smith 1723-1790
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Adam Smith

• His arguments rested on what he called the Three
  Natural Laws of Economics
• 1. Law of self interest People work for their
  own good.
• 2. Law of competition Competition forces people
  to make a better product.
• 3. Law of supply demand Enough goods would be
  produced at the lowest possible price to meet the
  demand in a market economy

Adam Smith 1723-1790
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The Hidden Hand of the laissez-faire economy
Every individual is continually exerting himself
to find out the most advantageous employment for
whatever capital he can command. It is his own
advantage, indeed, and not that of the society,
which he has in view. But the study of his own
advantage, naturally, or rather necessarily,
leads him to prefer that employment which is most
advantageous to the society. Adam Smith
he intends only his own gain, and he is in
this, as in many other cases, led by an invisible
hand to promote an end which was no part his
intention. Adam Smith
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The Philosophers of Capitalism
David Ricardo (1772-1823)
Thomas Malthus (1766-1834)
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Thomas Malthus

• Supported the basic ideas of Adam Smith and that
  natural laws governed economic life
• His ideas, (along with David Ricardos,) were the
  foundations of laissez-faire capitalism.

Thomas Malthus (1766-1834)
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Thomas Malthus

• In his essay, An Essay on the Principle of
  Population (1798), he argued that population
  tended to increase more rapidly than the food
  supply.
• Argued that without wars, famine, or epidemics to
  control the population, most people would be poor
  would suffer.

Thomas Malthus (1766-1834)
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Thomas Malthus

• He urged people to have less children to avoid
  overpopulation and the chance of large families
  becoming poor and to avoid suffering.
• Predictions became a reality during the 1840s,
  though the food supply eventually increased,
  living conditions improved, and people began to
  have less children.

Thomas Malthus (1766-1834)
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Thomas Malthus1766-1834
Population, when unchecked, increases in a
geometrical ratio. Subsistence only increases in
an arithmetical ratio. A slight acquaintance
with numbers will show the immensity of the first
power in comparison of the second. Thomas
Malthus
Who is mainly responsible for poverty?
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David Ricardo

• A wealthy stockbroker
• Believed the poor had too many children.
• Elaborated on Malthuss theory of economics in
  his book Principles of Political Economy
  Taxation (1817)
• Believed a permanent underclass would always be
  poor
• Believed as the population increased, wages would
  decrease (workers paid less)

David Ricardo (1772-1823)
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David Ricardo

• Principles of Political Economy Taxation (1817)
  continued
• Iron law of wages
• When wages are high, families have more children
• More children more workers
• More workers lower wages.
• Thus, higher wages and other reforms will not
  lead to real improvements.

David Ricardo (1772-1823)
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Laissez faire thinkers, such as Adam Smith,
Thomas Malthus, and David Ricardo all

• Opposed government intervention in the economy,
  which included government efforts to help poor
  workers.
• Believed people should be left to improve their
  lot through thrift, hard work, and limiting the
  size of their families.
• Argued creating a minimum wage and better working
  conditions would
• Upset the free market system
• Lower profits
• Undermine the production of wealth in society

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Discussion Laissez-faire Capitalism and the
Philosophers

• How were workers viewed by people like Smith,
  Malthus, and Ricardo?
• How did they view the poor? Was their view
  favorable or unfavorable? Explain your answer.
• According to Malthus and Ricardo, what affect did
  population growth have upon society?
• What flaws (if any) can you find with
  laissez-faire capitalism?
• Could a society have a capitalist economy in
  which a government could impose restrictions?
  Explain your answer. (Hint Think about the U.S.
  economy.)

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Socialism

• Grew out of the Enlightenment faith in progress,
  its belief in the goodness of human nature, and
  its concern with social justice.
• Supporters of socialism believed
• Governments should intervene in business
• Wealthy people or governments had an obligation
  to take action to make peoples lives better (i.e.
  better wages, working/living conditions,
  distribute wealth/power equitably)
• Condemned the evils of industrial capitalism,
  which they argued, created the huge gap between
  the rich and the poor.
• In a society in which would operate for the
  benefit of all its members, not just for the
  wealthy.

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Socialism

• Definition of socialism an economic system in
  which the factors of production are owned by the
  public and operate for the welfare of all.
• Under socialism, people as a whole would own and
  operate the means of productionthe farms,
  factories, railways, mines, and other large
  businesses that produced and distributed goods.

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Utilitarianism

• A form of socialism
• Definition of utilitarianism the theory,
  proposed by Jeremy Bentham in the late 1700s,
  that government actions are useful only if they
  promote the greatest good for the greatest number
  of people.
• Idea that the goal of society should be to bring
  about the greatest happiness for the greatest
  number of people.
• This theory provided that the government
  intervene in business and the economy to bring
  about economic and social equality, fair working
  conditions, and improved living conditions.

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The Philosophers of Utilitarianism
Jeremy Bentham (1748-1832)
John Stuart Mill(1806-1873)
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Jeremy Bentham

• Modified the ideas of Adam Smith
• Introduced utilitarianism in the late 1700s
• He strongly supported individual freedom, which
  he believed guaranteed the greatest happiness.
• Believed people should
• Judge ideas, institutions, and actions on the
  basis of their utility, or usefulness
• Be free to pursue his/her own advantage without
  interference from the state (government.)

Jeremy Bentham (1748-1832)
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Jeremy Bentham

• Benthams thoughts about
• the government
• The government should try to promote the greatest
  good for the greatest amount of people.
• Government policy was only useful if it promoted
  this goal.
• Laws or actions should be judged by their
  utility.
• Did they laws provide more pleasure (happiness)
  than pain?
• Believed the government needed to be involved in
  the economy in certain circumstances.

Jeremy Bentham (1748-1832)
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John Stuart Mill

• Philosopher economist, led the utilitarianism
  in the 1800s
• Questioned unregulated capitalism
• Believed it was wrong that workers led deprived
  lives and often meant starving to death
• Wished to help ordinary through governmental
  policies that would create an equal division of
  profits

John Stuart Mill(1806-1873)
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John Stuart Mill

• While he believed in individual freedom, he
  argued the government needed to improve the harsh
  life of the working class.
• Like other utilitarians, Mill worked for reforms
  in many areas affecting workers, the poor, child
  labor, and public health.
• Favored cooperative systems of agriculture
• Supported womens rights

John Stuart Mill(1806-1873)
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John Stuart Mill

• Suffrage argued workers and women should have
  the right to vote
• These groups could then use their political power
  to win reforms.
• Pushed for governmental reforms in the following
  areas
• the legal system, including prison systems
• education reform
• Class system he wished the government would
  abolish the great disparity between the rich and
  the poor.

John Stuart Mill(1806-1873)
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Utopia

• Definition of utopia an ideal society an
  imaginary land described by Sir Thomas More in
  his book Utopiahence, an ideal place.
• In Greek, utopia means no place.
• In Mores book, greed, corruption, and war had
  been weeded out. Because there was no greed in
  Utopia, there was no need for money.
• Influenced the political and economic philosophy
  of utopian socialism

Sir Thomas More (1478-1535)
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Utopian Socialism

• Early socialists were called utopians.
• Early socialists tried to build self-sufficient
  communities. In this community
• all work and all property was owned in common.
• They believed that no difference between rich
  poor no fighting between people.
• Why do you think utopians were referred to as
  impractical dreamers?

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Robert Owen

• Born a poor Welsh boylater became a successful
  mill owner.
• He refused to use child labor.
• Lobbied the government to pass laws limiting
  child labor and encouraged the organization of
  labor unions.

Robert Owen (1771-1858)
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Robert Owen

• Owens vision of Utopia
• Built a factory and a model village in New
  Lanark, Scotland.
• Built homes for workers, opened a school for
  children.
• Workers were generally treated well, illustrating
  an employer could offer decent living and working
  conditions while still running a profitable
  business.
• By the 1820s, people visited New Lanark to study
  Owens reforms

Robert Owen (1771-1858)
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The Philosophers of Marxism

• Definition of Marxism A radical type of
  socialism introduced by Karl Marx, a German
  journalist

Friedrich Engels (1820-1895)
Karl Marx (1818-1883)
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Karl Marx

• A German journalist
• Agitated for reform as a young man.
• A socialist who despised capitalism, which he
  argued, created prosperity for a few and poverty
  for many.
• Forced to leave his homeland because of his
  radical ideas.
• First lived in Paris and then settled in London,
  where he met Friedrich Engels.
• Along with Engels, they outlined their economic
  ideas in a 23-page pamphlet called the Communist
  Manifesto

Karl Marx (1818-1883)
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Friedrich Engels

• A German socialist residing in London, England
• His father owned a textile mill in Manchester,
  England.
• Teamed up with Karl Marx, to outline their
  economic ideas in a 23-page pamphlet called the
  Communist Manifesto

Friedrich Engels (1820-1895)
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Marx Engels The Communist Manifesto

• Marx and Engels argued that human societies have
  always been divided into two warring classes
• The middle class, haves or employers, called
  the bourgeoisie
• The wealthy controlled the means of producing
  goods
• The working class, have-nots or employees
  called the proletariat
• The poor performed backbreaking labor under
  terrible conditions.

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Marx Engels The Communist Manifesto

• The Industrial Revolution enriched the wealthy
  and impoverished the poor.
• Marx and Engels Predicted that the workers would
  overthrow the owners
• the proletarians have nothing to lose but their
  chains. They have a world to win. Workingmen of
  all countries unite.

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The Future According to Marx

• Marx argued the capitalist system would destroy
  itself in the following ways
• Factories will drive small artisans out of
  business
• Small number of manufacturers will control the
  wealth, causing a huge gap between classes
• The large proletariat will revolt, seize
  factories mills from capitalists

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Karl Marx(1818-1883)

• not only anticipated
• the ability
• of capitalism to achieve unprecedented rates of
  economic growth
• but also predicted
• the exacerbation of income inequality
• a larger pie but more disparate slices

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Marx and Alienated Labor (Labour)

• The devaluation of the human world increases in
  direct relation with the increase in value of the
  world of things. Labour does not only create
  goods it also produces itself and the worker as
  a commodity, and in the same proportion as it
  produces goods.

1818-1883
Karl Marx (1818-1883)
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The Future According to Marx

• Results of the proletarian revolt
• Workers will share in the profits
• Economic equality will be established for all
• Cooperative living education will yield a
  classless society and the state/government will
  disappear.
• The final phase of Marxism is called communism

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Communism

• Definition of communism an economic system in
  which all means of productionland, mines,
  factories, railroads, and businessesare owned by
  the people, private property doesnt exist, and
  all goods and services are shared equally.
• A form of socialism that sees class struggle
  between employers and employees as unavoidable.

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Communism

• Economics as the Foundation
• Mode of Production
• The history of all hitherto existing society is
  the history of class struggle.
• Theory of surplus value.
• Dialectical Materialism
• Mode of Production and material conditions drive
  ideas
• Violent Revolution as inevitable
• Classless Society -- bourgeois state will
  wither away.

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Short-Term Results of Communism

• 1848-1849
• Many revolts in Europe
• European leaders put down revolts
• 1900s
• Marxism inspired revolutionaries in Russia
  (Lenin), China (Mao Zedong), and Cuba (Fidel
  Castro).
• These leaders adapted Marxism to their own
  specific situations and beliefs