Capitalism vs. Communism

1. Capitalism vs. Communism

2. -Food and housing should be paid for by the government. There should be no upper class or lower class - everyone should be treated the same and have the same Communism

3. You will be allowed to keep all the money you make. Survival of the FittestIf you are poor or sick, there is no “safety net”, meaning you must rely on friends or your family to support you Capitalism

4. Capitalism

5. Capitalism • Capitalism – an economic system based on private ownership and on the investment of money in business ventures in order to make a profit.

6. Adam Smith • A Scottish political economist and moral philosopher (1723-1790). • His Inquiry into the Nature and Causes of the Wealth of Nations (1776) founded the modern discipline of economics and provided the rationale for free trade, (unrestricted by government regulation).

7. Physiocracy • Smith criticized physiocracy, which taught that wealth originated in land. • Smith argued that labor was the major source of wealth and that the division of labor was the key to economic growth. • As productivity rises, wages will rise. Your skilled labor = higher pay. More skill, more production, more pay)

8. Capitalism • Ideas: • Businesses compete with each other for the consumer’s money. • Each business tries to provide goods and services that are better and less expensive than their competition.

9. Capitalism • Government should not interfere in the economy. • Laissez faire (hands off)

10. The Invisible Hand • The free market appears chaotic and unrestrained. • Actually, it is guided by “an invisible hand” to produce the right amount and variety of goods. • If a product shortage occurs, the price rises, establishing a profit margin that provides an incentive for others to enter production.

11. Understanding CAPITALISM • You are in charge of your life and the means to work to support yourself.You can choose to run your own business • Capitalism can lead to materialism- the belief that material goods and money are the most important things on the planet. • You get the highest quality of products for the cheapest prices.

12. Understanding CAPITALISM • If you are poor or sick, there is no “safety net”, meaning you must rely on friends or your family to support you (with money and otherwise).  • You can become extremely rich if you work hard, know the right people, and/or are born into the right family.

13. Understanding CAPITALISM • You vote with your dollars. If you don't like shop at Store A, you can always shop at Store B.  If no one shops at Store A it will shut down. • You have the right to own property, which comes with the right to do what you wish on it (build a house, a business, etc.). • There is no minimum wage in a true capitalism, which means business owners can pay you as little as the market will bare. • $10/hr = 1 worker, $5/hr = 2 workers, $2.50/hr =4 workers (4 people have jobs vs 1 person, BUT, can you live off $2.50/hr)

14. COMMUNISM

15. Steps of Communism Communism • Marx and Engels studied the history of the world’s economies. • This means the way that power, industry and finance are controlled. • They saw the way countries developed in stages. Socialism Capitalism Feudalism Primitive Communism

16. Communism • How would you define “communism”? • What other words come to mind when you think of the word “communism”? • Are these associations positive or negative?

17. Communism • An ideology that seeks to establish a future classless, stateless social organization, based upon common ownership of the means of production and the absence of private property.

18. Who Made This Communist? • These guys wrote the ‘Communist Manifesto in 1847. It’s a short book – but billions of people have read it… • Pure capitalism with no government involvement leads to major societal problems, particularly in the industrial age.  The working class becomes exploited by the entrepreneurs seeking profit.  The working class receives none of the benefits and is even placed in danger. The rich got richer and the poor got poorer. This is Karl Marx, the ‘Father of Communism’. People who believe in his ideas are called ‘Marxists’ This is his good friend, Frederick Engels.

19. Marx • Karl Marx and Frederick Engels wrote The Communist Manifesto as an outline of what they saw as the perfect economic society: one where the workers controlled the economy for the benefit of everyone. • All resources of a country would be collected and redistributed evenly. Everyone would be equal, so there would be no class differences. • Communism struck a chord with the exploited workers.  The Manifesto was published at a time when many revolutions were taking place. (1848 in Europe had 3 revolutions) • This was a dramatic threat to those whose power came from having money (like kings, czars, and other rich people).  • "Working men of the world UNITE!"

20. What does the Symbol Of Communism mean? • This is the symbol of Communism-The Hammer and the Sickle. Hammer for the Workers! Sickle for the Peasants - the farm laborers

21. Atheism • Marx was an atheist. • He believed that religion was “the opiate of the masses.” • The owners of capital used religion to keep the peasants and workers subjugated by leading them to think, not of their present misery, but of future happiness in heaven.

22. Understanding COMMUNISM • Everyone is treated equally by the government. • Personal rights and freedoms are negotiated with the rest of society, actions deemed favorable are good and promoted, actions deemed unfavorable are eliminated • Everyone has a job based on their skill set • “from each according to their skills, to each according to their needs” • Challenge – “How do we determine proper needs, vs excessive consumption”

23. Understanding COMMUNISM • Laws are oftentimes much more strict, as the government wants to make sure people act in a certain way. • There is healthcare for everyone, as the government provides it. • Everything belongs to everyone.

24. COMMUNISM • When you go to any store, there are fewer choices as products serve a purpose, rather than displaying a status or uniqueness. (all rain boots are the same because there job is to keep your feet dry) • Each item carries a purpose. i.e. shopping carts at Safeway – does it matter which cart you grab (assuming they are all functioning the same). Essentially everyone owns a license to use the shopping cart while shopping, when finished, it gets put back in the cart rack. The next time you shop, you grab the first one that is available. There is no “special” value between 2 exact shopping carts.

26. Capitalism • United States is Capitalist (in design, but not pure free market in practice) • Work for profit and wealth • Competition between people and businesses • Private ownership by people and businesses • “Free Market” trade, buy, sell without restrictions from government.

27. Communism • seeks to establish a classless society (no rich/poor) • Ideology created by German Karl Marx 1800s- Wants a Utopia (Perfect society) • common ownership of land, farms, factories (no private property) • From each according to skills, to each according to needs.