Midterm review

Smith’s ideas—the importance of free markets, assembly-line production methods, and gross domestic product (GDP)—formed the basis for classical economics theories.

Laisses Faire- or free markets where new inst. Are est. to conduct market transactions

Philosophy of free markets(Smith)

  • The philosophy of free markets emphasizes minimizing the role of gov’t intervention and taxation in free markets

  • Although Smith advocated for a limited government, he did see the government as responsible for the education and defense sectors of a country

    . From Smith comes the idea of the invisible hand that guides the forces of supply and demand in an economy. Every person, by looking out for themselves, inadvertently helps to create the best outcome for all

Marx’s economic theory

  • The labor theory of value- states that the value of a produced economic good can be measured objectively by the average. # of labor hours required to make it

  • Marx claimed that two significant flaws in capitalism led to exploitation.

  • It was also argued that the specialization of the labor force, coupled with the growing population, pushes wages on goods and services, which doesn’t accurately account for the actual labor cost.

Smith vs. Marx- smith= production Marx= labor

The industrial revolution

  • Period of mechanization and innovation

  • American industrial revolution began in the 1870’s through WWII

  • This led

  • to the most significant economic expansion in history

Inventions during the IR

  • assembly line, telegraph, steam engine, sewing machine, internal combustion engine

Working conditions

  • Working conditions were harsh

  • hours are long, about 10-12 hours a day

  • unsafe conditions led to bad accidents

  • tasks tended to be divided for efficiency, which led to repetitive and monotonous work for employees.

Unions

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  • Eventually, workers began to fight for their working conditions

  • American Federation of Labor (AFL) was created in 1866 for skilled craftsmen

  • Industrial Workers of the World (IWW) formed in the 90’s

  • Groups such as these would organize strikes and boycotts to get management to acquiesce to their demands

The progressive era

  • The period of US history from the 1890s to the 1920s is called this era of social and political reform to make a better society.

  • During the progressive era, protections for workers and consumers strengthened, and women finally achieved the right to vote.

Problems with industrialization

  • Industrialization raised the standard of living in the US dramatically, but not perfect

  • corporate bosses, referred to as robber barons, pursued unethical and unfair business practices to eliminate competition and increase profits

  • factory workers and immigrants worked in brutal and dangerous working and living conditions

  • Political corruption helped politicians at the cost of the lower and working classes who struggled to make ends meet.

Progressive Ideology

  • Human nature could be improved through the enlightened application of regulations, incentives, and punishments

  • the second fundamental assumption was the power of the federal gov’t could be harnessed to enhance the individual and transform society

Progressive reforms

  • Reformers successfully influenced the passage of legislation, including some amendments to the Constitution.

  • 16th Amendment est. a federal income tax

  • 17th Amendment allowed for the direct election of senators

  • The 18th Amendment prohibited alcohol sales

  • 19th Amendment granted women vote

  • Legislation aimed at strengthening protections for workers and consumers, including the Pure Food and Drug Act of 1906, which created the Food and Drug Administration to guarantee the safety and purity of all food products and pharmaceuticals.

  • The Clayton Antitrust Act of 1914 sought to curb business practices to stifle competition.

WWI

Archduke Ferdinand,

  • what caused the war

  • Franz Ferdinand was the Archduke and heir to the Austria-Hungarian throne. On June 28, 1914, Ferdinand was driving with his wife when a Serbian nationalist named Gabriel Princip murdered the couple. Princip and other nationalists struggled to end Austria-Hungarian rule over Bosnia and Herzegovina. The assassination set off a rapid chain of events. Austria declared war on Serbia, and then Germany declared war on Russia because they were aligned with Serbia and because of their alliance with Austria. One day later, Germany declared war on France.

The Lusitania

  • The event that changed sentiment was the sinking of the British ocean liner Lusitania.

  • In 1915, it was sunk by a German U-boat and killed 2,000 people(128 American). Despite demanding Germans to end submarine warfare, it did not indicate war for America.

Zimmerman Telegram

  • January 1917, the British intercepted and deciphered an encrypted message from German foreign minister Arthur Zimmerman to the German minister in Mexico. It proposed an alliance between Germany and Mexico if America joined the war on the Allies' side. If adopted, Germans would support the Mexicans in regaining the territory they lost in the Mexican-American war, Texas, New Mexico, and Arizona. Additionally, Germany wanted Mexico to convince Japan to come over to its side of the war.

Second battle of the Marne

  • with Germany able to build up its strength on the western front after the armistice with Russia, allied troops struggled to hold off another German offensive. Until promised reinforcements from the US were able to arrive. On July 15, 1918, German troops launched what would become the last German offensive of the war, attacking French forces(joined by 85,000 American troops and some of the British expeditionary force). The Allies successfully pushed back the German offensive and launched their counteroffensive three days later.

  • After suffering massive casualties, Germany was forced to call off a planned offensive further North, in the Flanders region stretching between France and Belgium, which was envisioned as Germany’s best hope of victory. The second battle of the Marne decisively turned the tide of war towards the Allies, who were able to regain much of France and Belgium in the months that followed.

Treaty of Versailles

  • At the Paris Peace Conference in 1919, Allied leaders stated their desire to build a post-war world that would safeguard itself against future conflicts of such a devasting scale; some hopeful participants even began calling WWI “the war to end all wars.” However, the Treaty of Versailles, signed on June 28, 1919, would not achieve that lofty.

  • Saddled with war guilt, heavy operations, and denied entrance into the League of Nations, Germany felt tricked into signing the treaty, having believed any peace would be a “peace without victory,” as put forward by President Wilson in his famous 14 Points speech of January 1918 goal.

Manifest destiny

  • The phrase, coined in 1845, suggests that God destined the US to expand its dominion and spread democracy and capitalism across the entire North American continent. It was used to justify the removal of Native Americans and other groups from their home.

  • The rapid expansion of the US intensified the issue of slavery as new states were added to the Union, leading to the outbreak of the CW.

13th Amendment

  • intended to complete the destruction of slavery begun by the US government during the CW in its policy of military emancipation(freed slaves by use of military action). Guarantee of personal liberty for all persons in the US, the Amendment established a minimum national standard of equality founded on personal freedom expressed by the proscription of slavery and involuntary servitude. Passed by the house on January 31, 1865.

The enlightenment

  • The period during the 1700s with emphasis on rationality and reason

  • philosophy, government, and science

  • Inspired later revolutionary movements, mainly in the US and France.

Gettysburg address

  • Robert E. Lee(south) invaded Pennslyvania in June 1863. General Meade(Union) met Lee at Gettysburg. On July 2, Lee attacked the Union, and they held guard for three days. The Union had 23,000 casualties, and the Confederates had 28,000-1/3 of Lee’s army. The battle of Gettysburg was the turning point in the war, and Lincoln's speech commemorated the win.

    allied and central powers

  • Allied-great Britain, France, Russia , Italy, Romania, Canada, japan, and the Us

  • Central- Germany , Austria-Hungary, Bulgaria, and the ottoman empire

    Casualties

  • 9 million dead, 21 million wounded, and 10 million civilian casualties

  • Germany and France sent 80% of their men between ages 15 and 49