Download Responding to Classical Liberalism

Responding to
Classical
Liberalism
Chapter 5 and 6 (pgs. 114-157)
Overview
Classical Liberalism
theory
practice
Opposition to liberalism
Luddites
Chartists
Socialists
Classical
Conservatism
Reaction by Liberals
Welfare capitalism
Welfare state
Keynesian economics
Classical liberalism was meant to be a movement towards
freedom in society; to break with the confines of old, to
allow people to achieve what is in their own best interest
with little interference from government. Sounds great
doesn’t it?
How is Nathan’s hotdog
eating event a
metaphor—or bundle of
metaphors--- for what
was wrong with
classical liberalism?
Question for Inquiry
“Why did ideologies
develop in opposition to
classical liberalism?”
(2.7)
Classical liberalism and the Industrial Revolution
transformed western society. A society based on agriculture
and class separation (centered on station) became a society
based upon industry, emergence of a middle class, laissezfaire government and the pursuit of industrial efficiency.
The ruling elite that emerged (the factory owners and
entrepreneurs) and flourished under classical liberalism may
have lived more democratically than the old ruling elite but the
new ideology of laissez-faire capitalism was only concerned with
two things….
INDUSTRIAL EFFICIENCY
ACCUMULATION of WEALTH
These goals were considered more important than equality !!!!
Problems of Classical Liberalism…
• Huge companies took over, and small companies were no
competitive
• Monopolies on industries such as oil, steel, railroads, sugar
refining, meatpacking, and chemicals were developed.
• The huge monopolies that were being formed had so much power
that they could influence the government officials to pass laws that
were in their interest.
• Most of the wealth was in the hands of only a few very wealthy
people. (Robber Barons)
• Poor wages and working conditions
• Environmental concerns -- pollution, living conditions, etc
• Government had no “responsibilities” – self interest, personal
autonomy, laissez-faire, etc.
Not all people saw the Industrial Revolution and classical
liberalism as positive developments.
http://www.youtube.com/watch?v=3EfqaNBkvc&list=TLt92K3rgOjiRxO3yC4Yr9_xkw_vF6xInx
Responses to
Liberalism
https://www.youtube.com/watch?v=o9w6UVQ
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Opponents of classical liberalism increased and flourished in the
circumstances and conditions created by classical liberalism and a
number of movements and new ideologies arose in opposition to the
ideas/principles of classical liberalism…..
Grassroots Movements
• Luddites
• Chartists
New Ideologies
• Utopian Socialism
• Moderate/Democratic Socialism
• Marxism (communism)
• Classical conservatism
Grassroots
Movements
Luddites
 The Luddites, a band of
nineteenth century English
handicraftsmen, rioted in
protest to the textile
machinery that had taken
them out of business.
 Luddites destroyed thousands
of pieces of machinery until
they finally met their demise
around 1817 when the
government was able to
control Luddites riots.
Chartists
• Working-class in Britain that focused on political and social reform. They called for:
-
Universal suffrage for all men over 21
-
Equal-sized electoral districts
-
Voting by secret ballot
-
An end to the need for property qualifications for Parliament
- Pay for Members of Parliament
- Annual elections
• The right to vote was deemed essential to change; working class individuals were
denied this right
• Ironically, while the Chartists were a persecuted group, most of their demands were
eventually implemented in the Reform Acts of 1867 and 1884
New Ideologies
Socialist Ideologies
• An ideology based on collectivist values
• Specifics beliefs and values
o Resources should be controlled by the public (government) for the
benefit of everyone in society and not by private interests and not for
the benefit of the individual
o Economic equality
o Cooperation over competition
o Control and direction in the economy
• Developed out of a want to reform political, social, and economic
structures of 19th century…..to correct the problems that emerged
out the free-market system (capitalism)
• Two basic types of socialism emerged
SOCIALISM
Communism/
Marxism
Utopian Socialism
Democratic Socialism
Robert Owen – The Utopian Socialist
 Individuals such as Robert Owen
believed that education and
improved working conditions
could peacefully eradicate the
worst aspects of capitalism, and
lead to an ideal socialist society
where all could live happily.
 Utopian socialists wished to
modify classical liberalism, not
overturn the systems that
supported it.
Marxism/Communism
 Marxism is also called scientific socialism
or communism to distinguish itself from
other forms of socialism
 His ideas were based primarily on the
theory that history is the story of evolving
class warfare (radical socialism), a class
struggle (revolution) between the
proletariat (workers) and bourgeoisie
(owners).
Marxism/Communism
Actions/beliefs:
1.
2.
3.
4.
Public property
Government run factories
Government run banks
Nationalized Industries = government run,
owned and operated
5. Government control over transportation and
communication
6. Free public education
Classical Conservatism
• Classical conservatism was a right wing reaction
(reactionary) to classical liberalism
• Wanted to revert back to the way things were before
• Edmund Burke and classical conservatives beliefs:
• Society should be hierarchical (people are not equal—
some people suited for leadership) ---- ELITISM
• Limited electorate to choose government
• Care for the welfare of others --- tyranny is
unacceptable --- charity not gov’t programs
• Stability of society is paramount—achieved through
law and order and the maintenance of the customs and
traditions that bind society together.
• Burke predicted that Rousseau’s concept of the
“general will of the people” was misguided as it
would allow the mediocre, uneducated and
uninterested power to rule.
• Some classical liberals gradually came to see the merits of some of
their opponents’ views and modified some of their values and
beliefs
• Rather grudgingly, classical liberals began to recognize that some
changes were necessary. The basic premise for these modifications
was an acceptance of the fact that those who believed in the pursuit
of industrial efficiency—laissez-faire capitalists--needed to
develop a social conscience and more concern for the equality
rights of workers
• Welfare Capitalism: a classical liberal economic system combined
with a government that used legislation to give workers protection.
Examples: limited working hours, minimum wage, pensions,
medical plans, etc
• Britain, for example, passed a series of Factory Acts,
beginning in 1810
• Each Act gradually improved the working conditions
in factories, decreased working hours, regulated the
ages at which children could be employed, and
regulated the number of hours women and children
could be required to work
• Still, capitalists did not gladly or easily give way to
new ways of thinking about society’s responsibilities
THEODORE ROOSEVELT AND
WELFARE CAPITALISM…
• He was a republican who recognized some
of the problems associated with classical
liberalism
• When the United Mine Workers of
Pennsylvania walked off the job, instead of
calling in the army against the workers as
owners had hoped, Roosevelt threatened to
use the army against the owners should they
refuse to negotiate.
• He called this a “square deal” and eventually
forced the arbitration.
• In 1912, T. Roosevelt went on to form the
National Progressive Party because he felt
the Democrats and Republicans were too
resistant to change.
http://www.youtube.com/watch?v=5mWzXqDbM5c
Why Did a Third Party not Develop in America?
1. World War One (1914)
• Governments became per-occupied with the war effort
• Needed industrialists to ensure sufficient war supplies
2. The “First Red Scare” (1917-1920’s)
• Public fear of Communism
• Large labor strikes in USA…..rise of socialism?
3. A Return to Conservative Values
• Due to the Red Scare, Harding and Coolidge (conservative
republicans) were the next two presidents of the USA and promised a
“return to normalcy”
• Their platform included…..
 Isolationism
 Nativism
 Reduce government involvement
• The move from welfare capitalism to the welfare state was motivated
by the Great Depression.
• The problems that arose during this period made it obvious that the
existing political, economic and social order had failed.
• What began to emerge was as we know it today.
• United States was the richest
country in the world.(resources
& population)
• After the war the U.S.A.
became wealthy by mass
producing consumer goods
like radios and cars
• The USA and Canada also
became the breadbasket for
Europe during WWI.
• Factory workers were paid
well which meant they spent
money on consumer goods.
The beginning of the end...
• As the 20’s progressed , more and more people were buying shares/stocks of
companies “on margin” or “on time” (credit) and these shares rose in price.
• Factories produced more goods than people could buy; therefore, the supply of
goods was much more than the demand.
• After the war ended, America continued to produce large amounts of grain. When
France began producing grain again, the market became flooded and the price of
grain plummeted. People began selling their stocks
THE WALL STREET CRASH
• In 1929 share prices were
rising but profits for companies
began to decline.
• By September and October, the
market was fluctuating wildly
• On October 24th of 1929,
panic selling of shares forced
the value of shares to drop
drastically.
• By October 29th, the market
crashed. “Black Tuesday”
• The stock market crash brought
an end to prosperity in the
U.S.A.
Other Causes of The Great
Depression
• Supply outgrew demand……over production = falling prices
• Droughts
• Wages did not increase
to
match inflation
• Farmers went bankrupt
• Banks failed
• Factories closed
• Increase in unemployment
• High rate of corporate fraud
• By 1931, unemployed people were
lining up in breadlines since there
was no unemployment insurance.
• Countries used protective tariffs in
an attempt to protect domestic
industry, so global trade declined.
• By 1932, 12 million people were
unemployed.
• President Herbert Hoover feared
that assistance from the
government would make citizens
dependent and unable to stand on
their own two feet.
• In 1932, the American people voted
for Franklin D. Roosevelt as
president on a platform of
government intervention to get the
USA out of the Depression.
• Classical liberals believed that there
would be full employment when supply
and demand were in balance.
• They also believed that the “natural law”
of economics was that good times were
followed by bad times. Therefore, it was
the individual’s responsibility to save for
bad times during periods of prosperity.
• Keynes argued that the economy was
unstable and people reacted in times of
uncertainty by hoarding money, thereby
harming the economy.
John Maynard Keynes:
A British economist who
developed the theory known as
“Demand Side Economics” or
“Keynesian Economics” in
response to Great Depression
• Because few people could predict the variances in the market, most
suffered during times of recession and depression.
• He proposed a solution to this problem through the regulation of
government spending, taxation, the regulation of the interest rate and
production of money.
• In doing so, governments could regulate consumer demand, thus
regulating the economy. This became known as “Demand-Side
Economics”
prosperity
FISCAL POLICY
Increase government $
FISCAL POLICY
depression
Decrease government $
Decrease taxes
Increase taxes
MONETARY POLICY
MONETARY POLICY
Increase $ supply
Decrease $ supply
Decrease interest rates
Increase interest rates
Keynes’
Demand Side Economics
More money in
your pockets:
Governments
should spend
money in a
recession to reduce
its severity. It
should also reduce
taxes.
Less money in
your pockets:
Governments
should spend less
money in boom
times to soften a
boom. It should
also raise taxes.
The “New Deal”
• Franklin D. Roosevelt (FDR)was
president of the United States from
1933-1945
• He was the first to convert to Keynes's theories and put
them into practice….on a national level
• He implemented massive public works programs to put
people to work…..Alphabet Agencies (WPA, CCC, PWA)
• He called it the “New Deal”, an echo of Theodore
Roosevelt’s “square deal.”
• This represented the beginning of a shift to the welfare
state and a mixed economy (capitalism with government
intervention) in many Western democracies
• By the 1960’s North America and most of Europe had
some semblance of a mixed economy --- modern liberalism
Welfare
Capitalism
Socialism
Marxism
Modern
Liberalism
Classical
Conservatism
Classical
Liberalism
LEFT
Command
Economy
RIGHT
Mixed
Economy
Free-market
Economy
Traditional
Economy
Equal
• Welfare capitalism depended on the
efforts of capitalists and government;
ordinary citizens had little power or
influence in society, thus, equality rights
had still to be achieved
• During the 19th-century, labourers who
wanted to improve their standard of
living and their quality of life began to
attempt to form unions
• What this involved was a recognition of
a new right—the right to organize
• More and more people began to believe
that liberalism required a move toward
equal opportunity and equal respect for
all members of society
As a result of the struggles' of
the 19th-centry, unions exist
even today.
The Value of Unions…
• Unions could significantly strengthen
the achievement of labour’s goals by
acting collectively to negotiate
equitable wages and decent working
conditions—all of which undermined
the capitalist’s control of the
workplace
• They could also threaten a strike if
their desires were not met
• Unions were regarded as rebellious of
classical liberal principles and
capitalism, and were fiercely opposed
• Unions did not become legal in
Canada until 1872
• Classical liberalism proclaimed the
equality of men, but not all men.
Only certain men were considered
“equal” and in most cases women
were not included.
• In many cases only certain races,
economic classes, religious
members, etc were permitted to
vote while others were excluded.
• Slowly, qualifications were removed,
but for men only
• Women weren’t permitted to vote
until much later (depending on the
nation) and, in some cases, still do
not have the right to vote
Canadian Enfranchisement
•
Vote given to all citizens of European descent – both
men and women… The Dominion Elections Act (1920)
•
In 1929, the Canadian government recognized the right
of women to be run for and be appointed to public
office
•
First Nations were not given the vote or run for office
until 1960 (Inuit were awarded this right in 1950, but
most were unable to exercise this right as poling
stations were not set up in the North until the 1960s)
•
The last group to receive the franchise was prison
inmates in 2002.
•
Bhutan -- One vote per house. Although this applies to both men and women, in
practice it currently prevents many more women from voting than men.
•
Lebanon -- Partial suffrage. Proof of education required for women, not required
for men. Voting is compulsory for men; optional for women.
•
Brunei -- No suffrage for men or women. This country is ruled by a monarchy.
Neither men nor women have the right to vote or to stand for election.
•
Saudi Arabia -- No suffrage for women. The first local elections ever held in the
country occurred in 2005. Women were not given the right to vote or to stand for
election.
•
United Arab Emirates -- No suffrage for men or women. The Parliament is officially
appointed and there are no elections. Neither men nor women have the right to
vote or to stand for election.
Can you suggest why these nations may not be overly supportive
of suffrage in general and female suffrage in particular?
• Feminism, at its simplest, is the belief that
men and women are to be treated equally
in all respects
• Initially most people thought the rights of
‘man’, meant ‘men
• Women were expected to work as hard as
men, and were a source of cheap labour,
as they were usually paid much less.
• Gradually, women became more involved
in the public sphere, becoming involved in
politics; anti-poverty campaigns and child
labour movements; they were also active
in temperance societies, which fought
against the abuse of alcohol…..led to
prohibition in the USA
http://www.youtube.com/watch?v=aZMbTFNp http://www.youtube.com/watch?v=w6NJoadu
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P5I
Has modern liberalism gone too far??
•
Affirmative action refers to policies that take factors including "race,
color, religion, gender, sexual orientation, or national origin“ into
consideration in order to benefit an underrepresented group "in areas
of employment, education, and business", usually justified as countering
the effects of a history of discrimination.
•
Affirmative action is intended to promote equal opportunity. It is often
instituted in government and educational settings to ensure that
minority groups within a society are included in all programs. The
justification for affirmative action is that it helps to compensate for past
discrimination, persecution or exploitation by the ruling class of a
culture or those minorities that are seen as more “economically
challenged”