Reforming the
Industrial World
Chapter 9
Section 4
Main Idea


The Industrial Revolution
led to economic, social and
political reforms.
Many modern social
welfare programs
developed during the period
of reform.
Introduction
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In industrialized countries there was
a wide gap between the rich and
the poor.
Business leaders wanted the
government to stay out of their
affairs.
Reformers wanted governments to
play an active role to improve the
conditions for the poor.
Workers demanded more rights
and protection.
 Formed labor unions.
The Philosophers of
Industrialization

Laissez-faire –
economic policy of
letting the owners of
industry and business
set working conditions
without interference.

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Favors a free-market.
Literally means “let do”.
“Hands-off” approach.
Laissez-Faire Economics


Philosophers believed
that government
regulations only
interfered with the
production of wealth.
If government allowed
free-trade, economy
would prosper.
Adam Smith
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Defended his idea of a free
economy in The Wealth of
Nations.
Three natural laws of economics:
The law of self-interest – own
good
The law of competition – better
products
The law of supply and demand
The Economists of Capitalism

Capitalism – economic
system in which the
factors of production are
privately owned and
money is invested in
business ventures to
make a profit.
The Rise of Socialism


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Opposite of laissezfaire.
Philosophers believed
government should
intervene.
Wealthy people’s
and government’s
duty to take action to
help the less
fortunate.
Utilitarianism


People should judge
ideas, institutions, and
actions on the basis of
their utility, or
usefulness.
Government should
produce the greatest
good for the greatest
number of people.
Utopian Ideas


Other reformers wanted to create a utopia,
or perfect living place.
The “utopias” that were created did not last.
Questions
1.
2.
3.
4.
5.
Why did business leaders want the
government to stay out of their affairs?
What kind of approach does the
laissez-faire philosophy favor?
According to Adam Smith, what are the
three natural laws of economics?
What is the opposite of laissez-faire?
Why do you think the utopias did not
last?
Socialism




Reformers sought to offset the ill effects of industrialization
with a new economic system called socialism.
Socialism – factors of production are owned by the public
and operate for the welfare of all.
Grew from an optimistic view of human nature.
Argued that government should plan the economy and not
depend on the free market to do so.
Socialism (cont.)

Government control of factories, railroads,
mines, etc., would end poverty and promote
equality.
Presidential Election 2008


What message are the editors trying to send?
Do you agree?
Marxism: Radical Socialism



Karl Marx – German
journalist.
Introduced the world to a
radical type of socialism =
Marxism.
Marx, paired with Friedrich
Engels, wrote The
Communist Manifesto.
The Communist Manifesto


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
Argued that human societies have
always been divided into warring
classes.
Bourgeoisie – Middle Class,
“haves” or employers
Proletariat – “have nots” or
workers
Wealthy controlled the means of
producing the goods.
Poor performed difficult labor
under horrible conditions.
Marx and Engels



Industrial Revolution enriched the wealthy and
impoverished the poor.
Prediction: Workers would overthrow the owners.
“The proletarians have nothing to lose but their chains.
They have a world to win. Workingmen of all countries,
unite.”
The Future According to Marx

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Marx predicted that the workers would revolt.
What would happen next?
They would create a “dictatorship of the proletariat.”
State or government would wither away.
A classless society would develop.
This final phase was called pure communism.
Communism

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
Communism – complete form of socialism.
All means of production would be owned by
the people.
Private property would cease to exist.
Effect of CM
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Revolts sprung up.
Were not successful in the
long-term.
However, after 1900, there
were explosive results.
Marxism inspired Russia’s
Lenin, China’s Mao
Zedong, and Cuba’s
Fidel Castro.

Adapted Marx’s beliefs to
their own situations and
needs.
Labor Unions and Reform
Laws

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
Long hours, dirty and dangerous working
conditions and the threat of being laid off.
By the 1800s the working class had became
more involved in politics.
To gain reform, workers joined unions,
voluntary labor associations.
Unionization

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A union spoke for all people in a certain trade.
Unions engaged in collective bargaining.
 Negotiations between workers and their employers.
Bargained for better working conditions and higher pay.
If the owners refused…
Strike = refusal to work.
Unions


Unions were thought to be a threat to social
order and stability.
Combination Acts of 1799 and 1800 –
outlawed unions and strikes.
Reform Laws



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Factory Act – 1833 made it
illegal to hire children under 9
Children from 9 – 12 could not
work more than 8 hrs
Ages 13 – 17 could not work
more than 12 hours
Mines Act – 1842 prevented
women and children from
working underground
Questions
1.
2.
3.
4.
5.
Who owns the factors of production in
socialism?
According to the Communist Manifesto, the
people are broken up into two classes the
________ and the _______.
What were some of the effects of the
Communist Manifesto?
What would union members do if factory owners
refused demands?
The Factory Act of 1833 said that children
between the age of 13-17 could not work more
than ___ hours a day.