Download Capitalism Cons - Social Studies 30

The honeymoon doesn’t last
Disadvantages
•Consumers can be manipulated by advertising
•Prices and incomes might not reflect what is best for society
•Business cycle experiences many ups and downs (=
considerable unemployment)
•Monopolies and oligopolies can emerge that charge
unreasonable prices
•Extreme income inequality results
•Industry cost-cutting can lead to environmental problems
•Insecurity is present on a large scale
•Difficult to break out of cycle of poverty
 Lack of concern for the workers, seen in
industrialization nations from Great Britain’s factories,
US slavery, sweatshops in Asia
 The Great Depression, the 1990s dotcom bubble, the
2008 global recession, Enron…
 Competition does not mean a level playing field for all
companies (eg WalMart, Standard Oil)
 Global climate change brought about by the increasing
consumerism promoted by capitalism
 http://crisisofcredit.com/
 Classical liberal ideas had transformed society, but
not everyone benefitted equally
 Injustice or natural law (depends on your perspective)
 Rapid transformation of economic systems =
focus on efficiency and profit over humanity
 Protest – Luddites
 Economic liberal attitudes changed much more quickly than
political or humanitarian attitudes (rebound)
►child labor (women and children paid less)
►12-16 hour days
►limited or no breaks for meals
►corporal punishment
►fear of losing job
►living miles away from the factory
►poor living conditions
►short life span
►"Sarah Golding was poorly and so she stopped her
machine. James Birch, the overlooker, knocked her to
the floor. She got up as well as she could. He knocked
her down again. Then she was carried to her
house.......she was found dead in her bed. There was
another girl called Mary......she knocked her food can
to the floor. The master, Mr. Newton, kicked her and
caused her to wear away till she died. There was
another, Caroline Thompson, who was beaten till she
went out of her mind. The overlookers used to cut off
the hair of any girl caught talking to a lad. This head
shaving was a dreadful punishment. We were more
afraid of it than any other punishment for girls are
proud of their hair." An interview in 1849 with an unknown woman who worked
in a cotton factory as a child.
 “reactionary” – origin: French revolution
(opposition to revolution, conserve the
monarchy)
 Edmund Burke: Society has a natural hierarchy
which does not allow for equal political rights
(less educated/experienced = less able to
participate)
 Therefore, economic inequality can be justified
 Leaders should be humanitarian, but stability is
the primary concern
 Focus: equality through government intervention
(to varying degrees)
 Cooperation vs competition
 Utopian Socialists - modifying classical
liberalism
 Robert Owen – New Lanark
 Louis Blanc – socialist communities
 John Stuart Mill – liberal philosophy – including
the need for labor legislation to protect workers
against the abuses of the laissez-faire capitalist
system.
Some of the first government interventions during
the Industrial Revolution included labor
regulations
The creation of unions (often very difficult at first)
gave the workers a stronger voice
 Triangle Shirtwaist Fire
 London Match-worker’s Strike
 Public ownership of property
 ideals of equality and economic strength is
promoted (usually in areas of national importance, areas
of high risk or to protect employment)
 Joint ownership is often favored
 Government controls and subsidies
 Redistribution of wealth
 social programs and progressive taxation,
direct and indirect taxation (GST, airline fuel
taxes)
 Very similar to Canada’s economy, however it is more
socialized
 More unionized – attitude of cooperation instead of
competition
 “Cradle to Grave” – services span lifetime (prenatal care
to university tuition to senior’s pensions)
 Indicative Planning – 5 year plans
 Differ from Communist five year plans as they are
created by labor, management and government to
indicate where the economy should go
 What goods/services to produce: consumer
demand and government determination of goods
citizens need
 How to produce the goods/services: competition
with some government help if necessary
 Who should the goods/services be distributed to:
government ensures economic equality by
providing basic goods and services for everyone,
goods/services also produced for those who can
afford them
 What is your opinion of capitalism?
 In your answer, include a reflection on:
 What are the basic tenants of classical economic
liberalism (capitalism)?
 What are the benefits of capitalism?
 What are potential problems created by capitalism?
 Is the rejection of capitalism and acceptance of socialism
a better way?