Ideology II: World Economies
An economy is a system by which a nation
produces and distributes goods and
Must answer “The Three Questions”
What shall we produce?
How shall we produce it?
Who will receive what we produce?
The Three Questions are answered by
consumers (a.k.a. the “market”)
Here’s the process:
A product or service is wanted (demand)
An entrepreneur produces it for the market
The entrepreneur hopes to make a profit
Capitalist: Person who invests in
companies (stockholder) who also wants
to make a profit.
Competition: The Regulator of
Competition is supposed to regulate price
and quality of goods and services
If an entrepreneur is selling something
that is shoddy or too expensive then
someone else will produce a better
product at a cheaper price.
Market Share: The percentage of the
market that a producer serves.
Role of Government
since The Three Questions are answered by
the market the government is supposed to
stay out of it
Military?, Police?, Fire?, Schools?, Roads?
Only private ownership of property
No public (government-owned) property
A.K.A.-Free Enterprise and Free Market
Problems With Capitalism
Little or no competition
Monopolies: One company controls an entire market
(“cornering the market)
Consumers can accept their price and quality or go
No Entrepreneurs for a particular good or
service if the market is very small
Very expensive things
Outdated goods or services (typewriters)
Problems With Capitalism
No government regulation (minimum
wage, working conditions, etc…)
Environmental Issues (ex. pollution,
logging, endangered species)
No “safety net” for the poor
A small, very wealthy upper class and a
very large, very poor lower class
Life in a Purely Capitalist Economy
Stufflebeam Academy: Very expensive but an
Who gets to go to school?
Obviously, a purely capitalist economy is
Government answers The Three Questions
Everyone works for and is paid by the
Only Public Property
Equal Distribution of Wealth
No Social Classes or Poverty?
Life in a Communist Nation
Long lines due to scarcity of goods and
Little choice of goods and services
Communist Countries: Vietnam, North
Korea, China, Cuba
Problems With Communism
Who gets what? Not everyone needs the
You can’t get ahead. There is no incentive
to work hard. Are you ready to do your
best for the benefit of everyone else?
Ex. Huge State Farms: Alcoholism,
Tends to be dictatorial (you’ll learn why
More on Communism
The Communist Manifesto
Marx: Organized religion is a lie meant to
keep the proletariat obedient.
The government answers some of The
Three Questions and the market answers
Heavy Regulation of Business
Tax the Rich
High Minimum Wage
Police, public ed., fire, etc…
Minimum wage, labor laws, social security,
medicare/medicaid, regulations on business
Post Office, Amtrak, Utilities, Taxes, Area 51
“Socialized” Health Care?
Fascism: An Ideology but not an
Extremely Right-Wing Ideology
Ideology and Political
Are All People Equal?
Capitalism: No. It’s a dog-eat-dog world
Communism: Yes. Everybody gets the
Socialism: Not quite equal but not too far
away from each other in regard to
Facism: No. Kill the inferior races.
(Genocide or ethnic cleansing)
Should Government Be Big?
Capitalism: No. Government should only
exist to protect the nation and its citizens
Communism: Yes. Government should
own and control all property and equally
distribute goods and services.
Socialism: Sort of. Heavy taxes, social
programs, government regulation of the
Is Change Good?
Capitalism: No. The market will decide
what change, if any, takes place.
Government will not institute social
Communism: Yes. A revolution must
overthrow the capitalists
Socialism: Slow but steady change
The Two Cow Analogy
If you have two cows in a capitalist country you
sell the milk for a profit and buy more cows.
If you have two cows in a communist country
the government takes them and equally
distributes the milk.
If you have two cows in a socialist country the
government takes one cow and gives it to
someone who doesn’t have any cows.
If you have two cows in a fascist country the
government doesn’t care but will kill or imprison
you if you are a racial minority.