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The Evolution of Modern Liberalism
Chapter # 6
**Evaluating the evolution of modern liberalism
Chapter # 6 Vocabulary Consumerism Income disparity Inflation Monopoly Social programs Trickle-down economics Welfare state
Modern American liberalism is a form of liberalism that arose from progressive ideals such as Theodore Roosevelt's New Nationalism, and Franklin D. Roosevelt's New Deal. Modern American liberalism is a combination of social liberalism, social progressivism, support for a welfare state and a mixed economy. Keynesian economics play an influential role in the philosophy.It is often associated with the Democratic Party. Liberals support freedom of speech and freedom of religion as well as government entitlements such as health care and education. :the central premise that individual freedom can only exist where it is protected by a strong democratically elected government that has an active role in society and the economy. ( summarize this slide)
Homestead Strike The failure of the strike was the beginning of a long decline for the steelworkers union.
Carnegie steel plants would employ only non-union workers for the next 40 years.
Read p. 196-97
skip
Economics and the Principles of Liberalism in North America skip Taking an Economic Practice Opinion Poll Rm 6.1 Question 1-20 Survey 4 other students and identify the three
questions with most agreement and the three questions where you opposed almost unanimously.
The Jungle is a 1906 novel written by author and socialist journalist Upton Sinclair. Sinclair wrote this novel to highlight the plight of the working class and to remove from obscurity the corruption of the American meatpacking industry during the early 20th century. The novel depicts in harsh tones the poverty, absence of social programs, unpleasant living and working conditions, and hopelessness prevalent among the working class, which is contrasted with the deeply rooted corruption on the part of those in power. The sad state of turn-of-the-century labor is placed front and center for the American public to see, suggesting that something needed to be changed to get rid of American "wage slavery".
Read p.198-99
skip
The Progressive Era (Series: America in the 20th Century) http://www.learnalberta.ca/content/aeve/movi
eLauncher.html?movie=smil/progressive_era_cc.mov
Roosevelt’s Progressivism Gave the public a “square deal” Preventing large companies from abusing their
control over the marketplace. Why was Standard Oil on Roosevelt's hit list? Notes on Taft and the Sherman Anti-Trust Act Notes on Alphonse Desjardins and Credit
Unions How did these reforms help Americans?
Reforms Limited to some extent the classical liberal
freedoms and principles of the marketplace. Reforms prevented powerful entities from
abusing the rights and freedoms of less influential organizations and individuals.
Credit Unions: profit-sharing operation went against classical liberal principles.
Evolution of modern liberalism
Roaring TwentiesRoaring Twenties is a phrase used to describe the 1920s, principally in North America, that emphasizes the period's social, artistic, and cultural dynamism.Everyone would have a chance at attaining prosperity The Wall Street Crash of 1929 served to punctuate the end of the era, as The Great Depression set in.RadioProhibition TalkiesTVWomen get the vote
Political cartoon of 1919 depicting a "European anarchist" attempting to destroy the Statue of Liberty.
The term "Red Scare" has been retroactively applied to two distinct periods of strong anti-Communism in United States history: first from 1917 to 1920, and second from the late 1940s through the late 1950s. These periods were characterized by heightened suspicion of Communists and other radicals, and the fear of widespread infiltration of Communists in U.S. government.
Represents Liberal Democracy
The first Red Scare 150,000 anarchists or communists in USA in
1920 Seattle docks were idled by a strike race riots,
police strike in major American cities contributed to the perception that support for Socialism and communism in America was growing.
Produced an atmosphere of political conservatism. (ultimately lead to a resistance to change.)
Harding and Coolidge p.202-03 What was Harding’s platform of a “return to
normalcy”? How were the tax reductions and subsidies by
Coolidge a reflection of classical liberalism? How do the developments of economic
prosperity, mass production, mass marketing and consumerism reflect the values of classical liberalism?
Tax reductions and reduced subsidies Lessens the level of government intervention Strengthens the role of the market.
Economic prosperity and Consumerism
Henry Ford and mass production ( produce large volumes of a product)
Practiced Welfare capitalism : minimum wage and a 40 hour work week. Better wages would encourage them to buy more goods
and services Consumerism increased during the 1920’s Radio ,film, telephones and refrigeration encouraged
consumerism.
The Stock Market Crash of 1929 P.206-07 Notes Define Bank runs Social Effects of the Depression Notes 207-08
The 1930’s and the Great Depression
The Election of 1932 Americans blamed President Hoover for the
country’s economic woes. Franklin Delano Roosevelt won the Democratic
Party’s nomination. Roosevelt promised relief for the poor and more
public works programs to provide jobs. He attacked Hoover and the Republicans for their response to the Great Depression.
Long-lasting influence on liberal democratic governments. ( government intervention)
The New Deal had three major goals:
I. Relief for the unemployed
II. plans for economic
Recovery
III. Reforms to prevent another depression
Evolution of modern liberalism
Banking Crisis
• Temporarily closed all the nation’s banks to stop panic and large-scale withdrawals
Hundred Days
• Roosevelt pushed Congress to put most of his New Deal into practice.
• The New Deal promised relief, recovery and reforms.
Franklin Roosevelt as President
Radical Reactions to the New Deal
Conservative Reactions to the New Deal
• Believed the New Deal did not go far enough in reforming the economy
• Wanted a complete overhaul of capitalism
• Attacked the New Deal as a radical break with traditional American ideals
Trouble for the New Deal
RM. 6.2High light a document
The Nation’s Economy
Economic Theory
• Roosevelt had hoped to cut back on government spending, for he feared the growing federal budget deficit.
• As unemployment rose during 1937 and 1938, the government spent large sums of money to help the unemployed.
• British economist John Maynard Keynes argued that deficit spending was needed during a depression.
Economic Downturn of 1937
Write a paragraph in a word document In what ways did Roosevelt’s New Deal reject
or reflect the principles of Liberalism?
The Dark Years 1929-1939 in Canada
http://www.learnalberta.ca/content/aeve/movieLauncher.html?movie=smil/dark_episode_1_ana_cc.mov
Government Responses to the Depression in Canada
Prime Minister Bennett Relief camps Believed that laissez-faire policies would lead
the country out of the crisis Created the Bank of Canada: took control of
the money supply.
Bennett's New Deal Bennett's "New Deal" promised a more progressive
taxation system, a maximum work week, a minimum wage, closer regulation of working conditions, unemployment insurance, health and accident insurance, a revised old-age pension and agricultural support programs.
Nevertheless, Bennett lost the October 1935 general election. ( evolution of modern liberalism)
Prime Minister Mackenzie King Created many social programs ( modern
welfare state ) Unemployed built airports Established Trans-
Canada airlines National Harbours board Created the CBC
Crown Corporations And Social Programs Bank of Canada National film board Unemployment Insurance Family allowance National Housing Act ( low income housing) ** the evolution of modern liberalism
The Ebb and Flow of Economic Liberalism Since the Second World war
Canada: strengthened social programs Public health Care Old Age Pension Foreign Investment Review agency CRTC: An independent agency responsible
for regulating broadcasting and telecommunications systems in Canada
Economic Crisis of the 1970’s USA wanted their currency to “float”; not be
tied to the gold standard Other countries followed suit, and a period of
inflation followed. Classical Liberalism: currencies would trade
freely in an open market.
Yom Kippur War 1973 1973 Arab-Israeli War and the Fourth Arab-Israeli War
between Israel and a coalition of Arab states backing Egypt and Syria.
Egypt and Syria respectively crossed the cease-fire lines in the Sinai and the Golan Heights, which had been captured and occupied by Israel since the 1967 Six-Day War.
Opec:( organization of petroleum exporting countries) imposed a 5 month embargo on the USA who has always back the state of Israel.
Opec: reduced production causing an increase in price and added to the inflation as a recession occurred as countries that cut back in economic production.
Stagflation: a recession and high inflation as the same time.
Yom Kippur War 1973
Stagflation
Cost of social programs go up as the recession causes more unemployment.Governments are collecting less taxes from big business and the average citizens
Monetarism: Friedman and Hayek Try to undo the interventionist policies of
previous governments (Klein and Stephen Harper)
One monetarist policy conclusion is the rejection of fiscal policy in favor of a “monetary rule.” ( interest rates)
http://www.youtube.com/watch?v=Q277sXW0Z2k&feature=related Moore schooled by Friedman over economics http://www.youtube.com/watch?v=cD0dmRJ0oWg&feature=related
http://independence4wales.com/2012/milton-friedman-the-road-to-serfdom (very good)
Supply-side emphasizes the importance of tax cuts and business incentives in encouraging economic growth, in the belief that businesses and individuals will use their tax savings to create new businesses which in turn will increase productivity, employment.
Supply Side Economics
Reaganomics
Tax cuts primarily for corporations and the wealthy
government spending cuts on social services
deregulation of the economy Thatcherism: wide scale privatization emphasis on individual and self-help
(classical Liberalism) reduced the power of the labour unions (
unions are seen as a threat to the free market system)
http://www.youtube.com/watch?v=z5CCRI1vdwE&feature=related
Reagan’s plan for tax and spending cuts
Two goals
Reduce taxes to stimulate economic growth
Cut the federal budget
Based on supply-side economics
A theory that says breaks for businesses will increase supply of goods and services, aiding the economy
Reaganomics
Thatcherismhttp://www.youtube.com/watch?v=40NVkfbaMo4
Pause and Reflect p. 224 In what way does this example represent a
middle ground between laissez-faire economics and social justice?
Democratic Socialism It is characterized by central
planning, nationalization and a comprehensive social welfare programs. ( universality )
Legislative reforms Sweden is the modern “
Social Welfare State”.
Public vs Private Industries Public Ownership 25% of the forest
industry 50% of the hydro 85% of the iron ore 95% of the
railroads The telephone
systems
Private Ownership
90% of workers work in private firms
Large multinationals exist such as Volvo, Saab.
P.226 Life is a Smorgasbordhttp://www.ifitweremyhome.com/compare/US/SE
Sweden United States
P. 228 Comparative Scale Draw figure 6-16 into your notes
Review points
Economic Liberalism and the Global Economy Today There is the recognition that governments do indeed
have a role to play in furthering the principles of modern liberalism ( domestically as well as internationally)
We have begun to question the unregulated free market
Bailout of industries and the regulation of banks in the USA.
The ebb and flow of liberalism seems to flowing towards the left ( greater role of government.)
Welfare Capitalism Combination of traditional free market
principles mixed with laws or practices of a welfare state
Provides a safety net for individuals living & working in society. Min. wage, working day, employment insurance
Rationale traditional liberal economic theory would suggest
workers are at a sever disadvantage compared to companies
Welfare State Completely provides for the welfare or
wellbeing of its citizens (physical, social) Greater economic equality (minimum
standard of living) Education healthcare, employment insurance,
price and wage controls, public transportation, child care,
Some paid by taxes other insurance programs (temporary or permanent)
Heavily taxed middle class and upper-class
Difficulties Creating an efficient system Rationing of goods and services (dependence) Lack of motivation Resentment by those who work and have to
pay heavy taxes to support those who do not work.
Fiscal Policy Government’s use of taxing and spending to
regulate and influence the economy. Governments use of spending and taxes to
influence growth or decline the business cycle.
Weak economy deficit spending Strong economy raise taxes Keynesian policies
Monetary Policies Government regulation of the supply of money to
influence the economy. When the economy is slowing down interest rates
are lowered to stimulate borrowing and improve the economy (increasing the amount of money available)
When the economy is strong / growing (inflation) interest rates are increased to reduce borrowing and slow down economic growth.
Milton Friedman supporter of monetarism.
Interesting article on Reganomics http://distributism.blogspot.com/2007/07/
myth-of-reaganomics.html
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