Political and Economic Systems: Key Concepts and Theories

Politician

An individual running for or serving in elective office, or someone using political skills in other social interactions.

Political Actor

Anyone actively engaged in political activity.

Politics

Any interaction among individuals, groups, or institutions seeking to make a collective choice or solve a collective problem ('who gets what, when, how').

Political Science

Focuses on interactions involving governments.

Rules and Institutions

Rules (specific or open to interpretation) guide and constrain reality. Institutions are organizations whose actions are governed by rules, often created to benefit those who advocate for them.

Constitution

Affirms basic legal principles, including government structure, duties, and rights. Its importance varies by country.

US Supreme Court

Rules on the constitutionality of political actions; compliance is expected.

Strategic Choices

Individuals in politics make choices based on rules and conditions to achieve their goals.

Fact vs. Opinion

A fact is supported by compelling evidence; reality is not a matter of opinion.

Democracy

Government where people choose leaders or policies.

Political Ideologies

Consciously held ideas about how political life is structured and how it should be structured.

Socrates

Emphasized reason and critical thinking to find truth.

Plato

Advocated for rule by exceptionally skilled individuals with wisdom and knowledge, free from temptation.

Aristotle

Ideal forms of rule included: Monarchy, Aristocracy, Politeia, Tyranny, Oligarchy.

Monarchy

Rule by a wise and virtuous leader for the community's good.

Aristocracy

Rule by a group of virtuous leaders.

Politeia

Rule by a majority of citizens (middle class) with varying wealth, aiming for the public good through rational debate and participation.

Tyranny

One person ruling for their own good.

Oligarchy

Rule by a few for their own advantage.

Thomas Hobbes

Laws of Nature: Rules based on human reason, leading to peace and safety if followed by all.

Leviathan

A powerful governmental entity needed to enforce laws of nature through fear of punishment.

Social Contract (Hobbes' view)

Agreement among individuals to give loyalty to a political ruler with unrestricted power to uphold natural laws and secure peace.

John Locke

Natural Laws: Universal moral rules discoverable through reason, grounded in God, establishing natural rights and duties.

Natural Rights

Inherent rights (e.g., to life), with corresponding duties to respect others' rights.

State of Nature (Locke's view)

Individuals have the right to punish violators of natural rights.

Social Contract (Locke's view)

Agreement to preserve private property and personal freedom, transferring enforcement power to a government whose sole purpose is to uphold natural rights.

Enlightenment

Emphasized ordering social, political, and religious life based solely on reason.

Adam Smith

Challenged mercantilist policies. Advocated for free exchange of goods and services (free market) among nations, arguing it leads to prosperity for all.

Jean-Jacques Rousseau

Humans have a natural right to be free and compassionate, but are enslaved by wealth/status, leading to oppressive regimes.

Social Contract (Rousseau's view)

Groups must develop a collective identity, guided by a charismatic leader and civil religion (common religious sentiments defining citizens as brothers/sisters, respecting differences).

General Will

The true good for everyone, advocated for direct assembly of people to determine laws without factions.

Classical Liberalism

Combines natural rights, limited government, and capitalism, endorsing free trade within moral limits.

John Stuart Mill

Philosopher who advocated for expanded commitment to freedom, including open debate and personal liberty.

Harm Principle

Legal and cultural norms must protect personal liberty, even with risk to the individual, as long as no one else is harmed.

New Deal

Economic regulations and social welfare programs in response to the Great Depression, challenging classical liberal belief in limited government.

F.A. Hayek

Argued extensive state planning of the economy limits freedom and can lead to serfdom.

Free Markets

Markets where prices are set by supply and demand, essential for efficient resource allocation and economic prosperity.

Nationalism

Political ideology that each nation should celebrate its distinctive contributions, which can lead to social exclusion and war.

Karl Marx and Friedrich Engels

Condemned nationalism as a distraction from economic struggles, predicting a global revolution leading to communism.

Class Consciousness

Workers bond over common economic conditions and demand change.

Dictatorship of the Proletariat

Temporary period where workers control the state to usher in communism and reshape social relations of production.

Antonio Gramsci

Introduced the concept of hegemony, where domination occurs through prevailing culture.

Vladimir Lenin

Believed workers needed a vanguard to seize power by force and act on behalf of workers.

Joseph Stalin

Lenin's successor, advocated for strict conformity with Marxist ideology.

Totalitarianism

State controls all aspects of citizens' lives to achieve state objectives.

Fascism

Ideology combining reverence for the state with nationalism, anti-communism, and skepticism of parliamentary government.

Nazism

Fascist ideology by Adolf Hitler that consolidated power in one ruler and justified racism.

Authoritarianism

Allows freedoms in nonpolitical life but no political challenge to the ruler.

Mao Zedong (Maoism)

Believed Chinese peasantry could usher in communism if led by a powerful political party.

Cultural Revolution

Persecuted urban, intellectual groups from 1966-1976 led by Red Guards.

Deng Xiaoping

Mao's successor who allowed controlled private property and free markets to increase economic efficiency.

Confucianism

Emphasized social cooperation, order, and hierarchy; currently influences Chinese Communist Party leaders.

Democratic Liberalism

Merges classical liberalism's capitalism and individual rights with equal treatment and democratic decision-making.

Direct Democracy

Populace decides political matters by direct majority vote.

Fusionism

Combines moderate economic libertarianism and moderate social conservatism (dominant in Republican party).

Libertarianism

Limits government to enhance personal freedom (speech, expression, personal behaviors). Wants to reduce economic regulation, income redistribution, and supports international trade, reduced tariffs, and immigration.

Social Conservatism

Upholds traditional moral standards based on natural law or local tradition. Accepts some personal autonomy rights (e.g., same-sex couples) but is concerned with judicial activism and embraces originalism.

Center-Left Democratic Liberalism (Democratic Party)

Maximizes personal liberty (avoiding large extensions), broadens personal autonomy (as long as no one is harmed). Endorses private property and capitalism for economic growth and improved quality of life, supports a robust role for government.

Problem of Survival

Man faces this problem as a member of a social group, not individually.

Self-centeredness vs. Cooperation

Humans are endowed with self-centeredness but require cooperation for survival.

Primitive Solutions

Includes Environmental Pressure (Direct need for existence, e.g., Eskimos) and Social Obligations (Universally accepted norms of kinship and reciprocity, e.g., Bushmen sharing game).

Challenges in Advanced Communities

Lack of tangible environmental pressure or strong kinship claims makes social cohesion difficult.

Vulnerability

Modern industrial life is vulnerable to human unpredictability (e.g., farmers not planting, railroad men changing careers).

Tradition

Society organized around handing down tasks and positions (e.g., caste systems in unindustrialized world).

Command

Authoritarian rule dictates tasks, enforced by edicts and penalties (e.g., Egyptian pyramids, Soviet Five Year Plans).

Market System

Society ensures continuance by allowing individuals to act as they see fit, guided by the rule of best monetary advantage (gain).

Medieval Fairs

Exotic goods, but rudimentary business practices (Roman numerals, errors in calculation, lack of zero understanding), small scale.

Andreas Ryff (1550s Germany)

Faced numerous customs tolls, diverse local currencies, weights, and measures.

Robert Keayne (1639 Boston)

Prosecuted for making 'outrageous gain' (over sixpence profit on the shilling), highlighting societal suspicion of profit.

Colbert's Regulations (1666 France)

Strict governmental control over manufacturing (e.g., specific thread counts for fabrics), punishing deviation.

Key Characteristics of the Pre-Market World

Absence of the idea of personal gain as a legitimate principle. Economic life inextricably mixed with political, social, and religious life; no separate, self-contained economic world.

Modernity of the Profit Motive

The profit motive, as understood today, is a relatively modern invention, not inherent to all human nature.

Pre-Industrial Labor

Workers, unaccustomed to wage work, might take more time off if wages rose, rather than working harder for more gain.

Social Sanction of Gain

Historically, the Church viewed merchants with suspicion and usury as sin. The object of life was often to maintain one's station, not advance it.

Early Capitalists

Often outcasts, not pillars of society (e.g., Saint Godric of Finchale).

Life Eternal vs. Earthly Life

The paramount idea that life on earth was a preamble to Life Eternal discouraged the business spirit.

No 'Making a Living' Concept

Work was an end in itself, a tradition, not a means to acquire money and commodities.

Markets vs. The Market System

Markets (places of exchange) have existed for millennia, but 'the market system' (a self-sustaining mechanism for society) is a modern invention.

Pre-Capitalist Blindness

The medieval world couldn't conceive of the market system because Land, Labor, and Capital (abstract agents of production) did not yet exist as freely salable, impersonal economic entities.

Land

Estates, manors were social and political cores, not freely salable real estate.

Labor

Serfs, apprentices, journeymen; their work was duty, regulated by guilds, not a network where services were sold to the highest bidder.

Capital

Private wealth existed, but no impetus for aggressive use; motto was 'Safety first,' with preference for longer, more labor-consuming processes, and advertising forbidden.

Absence of Economic Theory

Until the market system emerged, there was no need for economists or a theory of political economy. The world was explained by laws of manor, Church, and custom.

Not a Peaceful Evolution

The shift to a market system was a long, violent, and largely unwelcomed social convulsion.

Commercialization of Land

Required uprooting feudal life, converting social relationships into property.

Creation of 'Workers'

Transformed sheltered serfs and apprentices into a 'frightened, disoriented class called the proletariat.'

Capitalists from Guild Masters

Required teaching 'laws of the jungle' to cautious producers.

Resistance to Change

Guilds resisted innovation (e.g., new weaving techniques, button makers opposing cloth buttons).

Government Suppression of Inventions

Government bodies suppressed new inventions (e.g., stocking frame).

Trade in Forbidden Goods

Trade in forbidden goods (like calicoes) met with brutal suppression and loss of life.

The Enclosures

Massive movement in England (16th-19th centuries) where common lands were privatized for sheep grazing (wool production).

Dispossessed Peasants

Dispossessed peasants ('yeomen') lost their livelihoods, becoming paupers.

Laws Against Paupers

Laws designed to protect against paupers (tying them to parishes) paradoxically prevented the emergence of a fluid, mobile labor force.

Emergence of National Political Units

Centralized monarchies replaced feudalism, fostering national spirit, royal patronage for industries, and standardized laws, measurements, and currencies (replacing local variations).

Foreign Adventure and Exploration

Shift from private to national exploration (e.g., Columbus under Isabella), activating the chase for money (e.g., Queen Elizabeth's profits from Drake's voyage).

Decay of Religious Spirit & Rise of Protestantism

Italian Renaissance emphasized earthly life over 'Life Eternal.' Protestantism reevaluated the merchant's role, promoting 'pious' use of God-given talents in business.

Material Changes

Growth of towns, rudimentary roads, and trade fostered familiarity with money and markets.

Technical Progress

Development of rational money accounting (e.g., double-entry bookkeeping by 17th century) enabled large-scale business.

Rise in Scientific Curiosity

Encouraged invention and innovation.

Gradual and Sprawling Upheaval

The revolution spanned centuries, with old ways coexisting with new.