Capitalism versus Marxism 2 Economic Ideas that come out of the Industrial Revolution.
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Transcript of Capitalism versus Marxism 2 Economic Ideas that come out of the Industrial Revolution.
Capitalism versus Marxism
2 Economic Ideas that come out of the Industrial Revolution
Capitalism
I. What is Capitalism?
• An economic system
• Money invested in business w/ goal of making a profit
• Economic system of: America, Britain, France, Canada
II. Basic Concept of Capitalism
1. Capitalism based on “Laissez-faire”Translated: “to let be”
2. Idea: Allow the owners of factories or businesses to establish working conditions
3. Key: No government control or regulation
How will this be best for the people of Britain?
III. Creator of Capitalist System
Adam Smith (1723-1790)1. Wrote The Wealth of Nations, published in 1776
Key Ideas of the book:1. Free market (no gov’t rules or laws)2. Economy would be guided by an “invisible
hand”3. Division of labor4. Smith argued that humans are greedy &
selfish5. Competition would benefit society as a whole
V. Two Overall Arguments of the Capitalistic Thinkers:
1. Opposition to government intervention in the economy
2. Minimum wage laws & regulation of working conditions would lower profits
Communism/Marxism
Marxism• An economic & philosophical systemAn economic & philosophical system
– Opposes ideas of capitalismOpposes ideas of capitalism
• Arose due to poor conditions of the Arose due to poor conditions of the Industrial RevolutionIndustrial Revolution
• Also known as: Socialism, CommunismAlso known as: Socialism, Communism
Basic Ideas of Marxism
• No private property No private property – All property is to be owned collectively as a All property is to be owned collectively as a
societysociety
• Value of what is produced goes to the Value of what is produced goes to the worker worker
• All goods (money, goods, products) is to All goods (money, goods, products) is to be shared equallybe shared equally
Creators of Marxist System
• Karl Marx (1818-1883) & Friedrich Engels (1820-1895)
• Both were German• Both lived during the Industrial era• As a result, they became very angry about:
– Exploitation or mistreatment of workers– Unequal distribution of wealth
• Co-authored The Communist Manifesto, published in 1848
• Key Ideas of the book:– Industrial society had two classes
• Bourgeoisie – middle class, the “haves”• Proletariat – working class, the “have-nots”
– Marx & Engels predicted that:• Wealth/power is controlled by middle class, or the
bourgeoisie (factory owners, industrialists, etc)• The working class, or the proletariat would grow angry at
their mistreatment• The working class would unite & overthrow the middle
class in a violent revolution • Workers would seize control of factories • All wealth & resources would distributed equally• A classless society would emerge• Eventually, all resources (land, factories, mines,
businesses) would be owned & controlled by the people– This is known as Communism
The Communist Manifesto
Long-Term Effects of Marxism
• Ideas inspired future leaders & sparked revolutions– Russia: (1917-1991)
• Vladimir Lenin & Joseph Stalin
– Cuba: (1959 – present)• Fidel Castro & Ernesto ‘Che’ Guevara
– North Vietnam: (1954 – present)• Ho Chi Minh
– China: (1949 – present)• Mao Zedong
– North Korea: (1948 – present)• Kim Il-Sung & Kim Il-Jong