The Idea of Capitalism

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The Idea of Capitalism
that led to the modern philosophys
By SAM SHIN
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The Origin of Capitalism

• What is Capitalism??
• Capitalism is a combination of
  economic practices that became institutionalized
  in Europe between the 16th and 19th centuries,
  especially involving the formation and trade in
  ownership of corporations for buying and selling
  goods, especially capital goods (including land
  and labor), in a free market.
• The capitalism started when there were more
  individual rights permitted. Permission to more
  individual rights created private ownership and
  market system which bound the economy together.
  In a free market system, all the economic
  activities are left to people freely responding
  to the opportunities and discouragements of the
  marketplace. (Heilbroner Thurow)
• In a capitalist society, there is private
  ownership of the factors of productions, that are
  LAND (or natural resources), LABOUR (workers),
  and Capital (machinery in this case). Firms own
  them and must use them or put them together to
  produce what they want to produce.
• Producers try to compete with other firms in
  order to achieve their SELF-INTEREST or of the
  consumers. As a consumer, its self interest is to
  consume a good quality product at the lowest
  price, and as a producer, its self interest is to
  maximize its profit within the competition with
  other producers. And to be competitive, it is
  necessary to be able to use the factors of
  production wisely.
• And Adam Smith thought there was such a thing as
  an INVISIBLE HAND which is affected by this
  system of competition and moves these factors of
  production to those productions of goods that can
  satisfy consumers wants. (Heilbroner)

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Thomas Ruggles, Annals of Agriculture, 1792

• Everybody knows that bread covers at
  least two-thirds of the expenditure on food. A
  laborer's wage must be at least sufficient to
  maintain himself and his family, and must allow
  for something over. Were the wages not to do so,
  then the race of such workers would not last
  beyond the first generation. In Great Britain,
  therefore, the wages of the laborer must be
  evidently more than what is precisely necessary
  to bring up a family, and the price of grain must
  determine everything in regard to the economics
  of labor. However, failure to implement this
  level of wages may, perhaps, be mitigated by the
  adoption by the poor of the potato, a nutritious
  and cheap substitute. Nonetheless, the poor will
  not eat potatoes if they can get anything else,
  for the daintiness and ignorance of the poor in
  regard to the wonderments of this root has been
  the chief obstacle to its adoption. (Ruggles)

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How did Capitalism evolve into INDUSTRIALIZATION

• Capitalism had given producers a need of better
  technology in order to be able to produce faster,
  at lower costs, and in a most efficient way. This
  was caused by the grown importance of the market,
  where you have to pay for the factors of
  production you use for the production. And the
  existence of competition brought them a need of
  better technology as well. And this caused the
  Industrial Revolution during the 18th century in
  Europe especially England. (Heilbroner Thurow)
• And this need of better technology created
  many new inventions, many technological
  breakthroughs, and new source of energy, steam
  power (from fuels such as coal). Also bigger
  business required better operation of the
  production, and this created division of labor by
  which jobs by humans were much more simple.
  (Heilbroner Thurow)

Women Workers, making brushes in a steam powered
factory, c. 1884
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The Impact of Industrialization on Peoples LIFE

• Good Impacts
• Improvement in the standard of living
• Convenient Travel System
• Social Mobility
• Growth of Foreign Trade new things coming in
  and out

• Bad Impacts
• POLLUTION
• Unequal income distribution
• Child Labor
• Forced Labor
• Bad working conditions
• Decline in birth rates Increase of death rates
  before adulthood

The Industrial Revolution brought many benefits
to peoples life, but also harm too. Many
inventions such as coal train made peoples life
more convenient and easier, but by building many
factories and creation of the steam energy by
burning fuels caused pollution which has been one
of the biggest problems of the society now.
Also the division of labor made the workers job
extremely boring and repetitive.
Prolonged and exhausting labor, continued from
day to day, and from year to year, is not
calculated to develop the intellectual or moral
faculties of man.  The dull routine of a
ceaseless drudgery, in which the same mechanical
process is incessantly repeated The mind gathers
neither stores nor strength from the extension
and retraction of the same musclesTo condemn man
to such severity of toil is, in some measure, to
cultivate in him the habits of an animal (KAY)
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Malthusianism that Evolved from Industrialization
Eventually, this kind of thing might happen to us

• Malthusianism was a pessimistic idea of Thomas R
  Malthus. He argued that the population of the
  world is growing vastly and eventually the food
  supply will not be able to keep up with it. He
  said this was all caused by the improve in
  technology which improved the standard of living.
  By improving the standard of living, peoples
  lives would be better off and they would get
  married younger and have families and increase
  the population.
• And so then, according to his theory there
  should be a point of balance where the food
  supply just can keep up with the world
  population. And he argued that we have to main
  that balance otherwise there wouldnt be enough
  food for people. To decrease the birth rate, he
  said simply getting married later and having
  small families was the solution.

Somalia suffered a severe famine in 1992 IS IT
TRUE THAT THE WHOLE WORLD IS GOING TO SUFFER FROM
THE STARVATION CAUSED BY OVER POPUATION??
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Will there be enough food in the future??

• U.N had reported that since 1950, the
  population had doubled to 6 billion and will
  again in 50 years. And many biologists argue that
  the solution to the idea of Malthus, that is
  about to come true, is to reduce the number of
  birth rate that has been increasing vastly over
  years. They say overpopulation has caused famine,
  diseases, hunger, environmental destruction.
  (Dooms Day)
• But on the other hand, economists argue that
  the food supply will keep up with the rate of
  increase in population. They say more people
  means higher quality of technology and life and
  we respond to the problems that occur. In fact,
  our agricultural development has made it possible
  for us to grow better and more food. Ex.
  Fertilizer
• And even though it is true that many people in
  Africa or South-East Asia suffer from starvation
  and insufficient supply of food.. But many people
  focus this problem on WARCONFLICT rather than
  overpopulation. In fact, the main issue of
  Ethiopia that caused unfair distribution of food
  was the war.
• We do possess good enough agricultural
  technology that improves over years, and it is
  assumed that 35 people can be fed with already
  existing technology. The main problem is unfair
  distribution of food in Africa that is caused by
  war and conflict. (Dooms Day).

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Communist Manifesto
And Marxism
Hammer representing the working class,
proletariat.
Karl Marx (1818-1883) was a Russian
philosopher. His philosophy, Marxism became the
basis and the origin of communism. He wrote the
COMMUNIST MANIFESTO in which, he speaks of his
ideal, the Russian nation replaced by communism
where the working class rules.
He believed that capitalism had created the
CLASS STRUGGLE, which is a separation of
proletariat, the working class and Bourgeoisie,
the ruling class. He believed that the working
class, who are the labor of the production, own
no property and work to produce goods and
services for wages, deserve more proportion of
the profit of the firm than what the ruling
class, who just owns the factors of productions,
gets out of the business. His idealistic way of
changing the society was a violent way, a
revolution, in order to grant the proletariat
with the command of the tools and production,
distribution, and exchange. And to create a
classless society under communism. (Worlds
Together)
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Marx Criticisms of Capitalism

• Marx had a lot criticisms about capitalism. Most
  of them was on the problems caused by
  Industrialization.
• First of all, he was against child labor. Child
  labor was one of the bad impacts of
  industrialization. He considered education as an
  important matter of life and the society. He was
  also against poor working conditions. During the
  industrial revolution, many people died of
  extreme amount of labor.
• And the low wages also bothered him. The working
  class, laborers got too low wages which dont
  balance to the amount of contribution.
• Factory workers, mostly migrants from the
  interior, earn no more today than they did in
  1993, several Chinese studies have found. The
  average wage of 50 to 70 a month also buys less
  today than it did in the early 1990's, meaning
  workers are losing ground even as China enjoys
  one of the longest and most robust expansions in
  modern history. The free-market economic
  policies have not left China worse off on the
  whole. They have lifted it out of the ranks of
  the world's poorest countries, created a nascent
  middle class of service industry workers in the
  big cities, and made China the largest Asian
  exporter to the United States. But China is
  living through a gilded age of inequality, whose
  benefits are not trickling down to the 700
  million or 800 million rural residents who live
  off the land or flock to the cities for factory
  or construction jobs. (Kahn)
• He predicted the continuation of all these
  problems would corrupt the capitalist societies,
  and the working class will gain control and
  establish communism.
• But hopefully, he was wrong, but those problems
  still exist.

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Social Darwinism

• Social Darwinism is created by those who claim
  the LAW OF NATURE by which, the stronger one win
  and the weaker ones lose. They also claim
  Survival of Fittest which means those who are
  successful at getting rich do so because they
  possess the genetic characteristics of the
  fittest ones. They justified imperialism by the
  survival of fittest
• The law of the stronger holds good
  everywhere in war, that nation will conquer
  which can throw into the scale the greatest
  physical, mental, moral, material and political
  power, and is therefore the best able to defend
  itself. War will furnish such a nation
  withenlarged possibilities of expansion and
  widened influence, and thus promote the progress
  of mankind Strong, healthy and flourishing
  nations increase in numbers. From a given moment
  they require a continual expansion of their
  frontiers, they require anew territory for the
  accommodation of their surplus population. Since
  almost every part of the globe is inhabited, new
  territory must, as a rule, be obtained at the
  cost of its possessors that is to say, by
  conquest, which thus becomes a law of necessity.
  (Bernhardi)
• As the industrialization increased its scale,
  there was a bigger difference in peoples wealth.
  This philosophy was created to prevent poor
  people from revolting because some might think
  the governing system or capitalism is not just or
  fair.

Bill gates, who is considered to be one of the
richest and most powerful man in the world. Is it
just because he was BORN WITH the genetic
characteristics of those who survive??
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Problems of Social Darwinism

• Should we really abandon the weaker people??
  This is against moral.
• Also education difference can explain wealth
  difference.

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THE END
Thank You