economic systems capitalism, socialism & communism
TRANSCRIPT
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Warm-Up*For our warm-up today, we will be watching a
short video clip. After the video, answer the following questions for your daily warm-up.*
1. Which political group supported monarchies?
2. Which political group supported change?
3. What was the concert of Europe?
4. Was Klemens von Metternich a liberal or a conservative?
5. Which religious group dominated northern Europe?
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Liberalism and Conservatism
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Economic SystemsCapitalism, Socialism & Communism
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The Industrial Revolution • Increased wealth and means of production
•Growing inequality between social classes
•Arguments broke out over how the economy should operate
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Which is more important:Liberty or Equality?
•What is Liberty?
•What is Equality?
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Capitalism = free market• Maximizes freedom in the economy
• Adam Smith – 1776 – “The Wealth of Nations”
• “Free Enterprise” – no limit to wealth
• Laissez-Faire – “let alone” economy
• Free to succeed and to fail
• Private capital
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Capitalism- “the invisible hand”•Private sector provides
services
• Invisible hand: By pursuing their own needs, businesses will improve society unintentionally
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The “Threat” of Capitalism“4 Delicious Foods Banned because of Capitalism”
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4 Delicious Foods Banned because of Capitalism
North Korea: Choco Pies used to boost morale
suspected of arousing pro-capitalist feelings.
Bolivia: Coca-Cola banned to encourage consumers to
buy local Mocochinchi.
Russia: McDonald’s banned because it “symbolized
America”.
France: Ketchup was taking the place of traditional
Gallic sauces and banned to promote the consumption of
French cuisine…and healthier food.
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Socialism- wealth owned by government
• The government controls means of production
• Some private property
• Redistribution through high taxes
[Example: In Sweden the tax rate is very high, but college education and healthcare are covered for all Swedes. ]
Those who pay taxes have their needs met regardless of access to capital.
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Communism• Public (government) ownership of capital
• “From each according to his ability, to each according to his need.”
• No competition
• Government provides basicneeds and pay
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History of Communism•Karl Marx – 1848
“The Communist Manifesto”
• Father of Communism
1. All history is a class struggle.
2. All value comes from labor/work.
3. The government always sides with the rich.
4. The poor must overthrow the government and set up a classless society.
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Rock, Paper, ScissorsPlease clear your desks.
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Rock, Paper, Scissors• I am going to give each of you poker
chips.
•Once everyone has theirs, you will play R,P,S. If you lose, you must give the winner one of your chips.
• Sit down when you run out of chips.
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Rock, Paper, Scissors
•How did you feel about Round 1?
•Was it fair?
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Rock, Paper, Scissors
• I’m going to come around the room and offer you as many chips as you would like.
•Take whatever you think is fair.
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Rock, Paper, Scissors
•Now I will collect all the chips and redistribute them equally.
•Is this fair?
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Warm-UpTurn in the map packets you received before the snow!
1. What is laissez-faire economics?
2. Who wrote The Wealth of Nations?
3. Explain the invisible hand principle
4. What is redistribution, and how does it relate to socialism?
5. What is a difference between socialism and communism?
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The History of Economics in QuotesOn your handout, summarize the text in each quotation.
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1. “Advocates of capitalism are very apt to appeal to the sacred principles of liberty, which are embodied in one maxim: The fortunate must not be restrained in the exercise of tyranny over the unfortunate”Bertrand Russell
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2. “The inherent vice of capitalism is the unequal sharing of blessings; the
inherent virtue of socialism is the equal sharing of miseries.”
Winston Churchill
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3. “History suggests that capitalism is a necessary condition for political freedom.”
Milton Friedman
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4. “This American system of ours, call it Americanism, call it capitalism, call it what you will, gives each and every one of us a great opportunity if we only seize it with both hands and
make the most of it.”
Al Capone
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5. “I find capitalism repugnant. It is
filthy, it is gross, it is alienating...
because it causes war, hypocrisy and
competition.”
Fidel Castro
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6. “The problem of social organization is how to set up an arrangement under which greed will do the least harm, capitalism is that kind of a system.”
Milton Friedman
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7. “Socialism proposes no adequate substitute for the motive of enlightened selfishness that to-day is at the basis of all human labor and effort, enterprise and new activity.”
William Howard Taft