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Transcript of Timeline
To prevent the uprising from becoming violent, the government created laws to protect the rights of workers.
Industrialists also tried to accept some worker demands on their own to prevent an increase in government regulation.
As a result, working conditions improved; workers too could now enjoy the freedom that classical liberalism gave them, making it more popular, even with a bit more government involvement by Fizzah, Linda, Jimmy, and Kelly The Evolution of Liberalism 1800 - 1900
Classic Liberalism Birth of Classical Liberalism, a time period that was on the very right side of the spectrum with close to no government involvement in economy 1900 - 1917
Welfare Capitalism Period where improvisation, where classical liberalism moves a little further away from the right side of the spectrum 1917-1929
Political Conservatism 1930 - 1970
Post-War Consensus As number of poors increased, popular support began to arise for political organizations with collectivist ideologies.
People believed that government should take on a greater role in the economy to prevent such extreme fluctuations and provide citizens with economic stability.
This began the significant shift away from classical liberal thinking toward a mixed economy and a more modern understanding of liberalism. 1970 - 2000
Monetarism, Reaganomics After the withdrawal of various countries from the Bretton-Woods Agreement, many countries were faced with a slowed down economy due to inflation
OPEC gas's oil embargo caused further inflation by increasing price of goods
Facing stagflation, governments could not seem to find a solution, therefore gave the freedom back to the people via monetarism and the "trickle-down economics", swinging society back right towards classical liberalism ideals of limited government intervention 2008 - 2013
Obamanomics After the 2008 global economic meltdown, Obama was elected as US president based on his platform of "Change", which includes more government regulation to combat the corruption of the wealthy in a capitalist environment and to stimulate the economy out of its recession As US president, introduced the "Square Deal": both labor and capital had to treated fairly.
Secured political freedom by expanding suffrage to all
Created a "Social Welfare State" while maintaining the principles of capitalism
This ensured that the wealthy were held responsible for their actions due to increased government involvement.
[Elkin's Act (1903), Meat Inspection Act (1906), Food and Drug Act (1906), Hepburn Act (1914)...etc]
Sherman Anti-Trust (1890) - gave the government power to exert control and break large monopolies/trusts to encourage fairness and competition The credit unions were group-owned, profit-sharing organizations, first founded by Desjardin
offered better lending rates and lower fees, and was more willing to loan to small businesses/lower classes compared to tradition commercial banks.
Provided access to financial service to a wide range of individuals
The idea of a collective group known as a union thus became quite common and popular in this period, further moving the economy to the left As the end of this time period approached, there was more government involvement to ensure people were held more accountable for their actions.
It gave protection and security to the workers and smaller businesses, to ensure they have equal opportunities of being successful.
The society shown an increase in the interest of collective welfare, while maintaining the capitalist principles classical liberalism.
As a result the people were generally happier, as both the industrialists and the workers were better off. One of the major contributor of the US economy was Henry Ford of the automobile industry
He came up with the idea of an assembly line to maximize production.
He also increased worker wages and reduced their working hours in an effort to maximize efficiency.
This increase in efficiency led to a reduction in the price of products that customers with a now greater income could buy, leading to an age of consumerism. Public fear of Communism, or fear of a communism-uprise like the USSR within America
The American public feared the Bolshevik communists, whose ideals were to have a government controlled, centralized economy; the exact opposite of what was benefiting America at the time.
Anything correlated to socialism or any form of collectivism such as labour unions were classified as communist and radical
This produced an environment of political conservatism and Xenophobia in the US Warren G. Harding as US president and his "Return to Normalcy": promised to protect America from foreign influence.
Nativism & Isolationism (1921): retreat from involvement in other countries' affairs, and promotion existing dominant culture within a country
Emergency Quota Act (1921) - restrict immigration to the US to protect economy from danger of communism
Revenue Act (1921, 1924, 1928) - drastically reduced taxes, allowing for more wealth with the people and less government involvement in their capital
MacCumber Tariff (1922) - protect American business and agriculture from foreign competition With such a good time, one that would be later known as the period of the roaring twenties, the people loved the system of classical liberalism, accepting and adapting it wholeheartedly and believing it to be the best way to create a strong economy. Because of very little government involvement under the principles of capitalism, the American public made risky decisions on credit-investments in the stock market
The failure of the stock market was the result of both man-made and natural coincidental reasons, however the chain reaction from the crash resulted in a severe recession that became a economic depression
The depression was internationally spread by the 1930's, especially in the US and Britain, as well as rest of Europe.
It caused Germany's hyperinflation to continue, and the nation to swings toward extremism.
This period of economic depression have a long-lasting affect that would influence the liberal democratic government, increasing their involvement in economies. The Depression led to a loss of faith in the system of the free market economy and classical liberalism.
This frustration led to a movement towards collectivism, and the popular Keynsian Theory was widely implemented amongst democratic nations; it's validity undoubted Time period where the western society was still under influence of Classical liberalism and on the very right of the spectrum US president Franklin D. Roosevelt introduced his "New Deal" - a series of relief program funded by the government in an attempt to combat unemployment and poverty in the aftermath of the Great Depression
Pushed for more government regulation in the economy, implementing the ideals of the Keynsian Economics theory.
Creates a more left wing society, favored and supported by most devastated Americans of the depression Premier Duplesis of Quebec used interventionist methods to assist the people of Quebec through a farm credit program, a commission to oversee fair wages and a benefit program for destitute mothers and the visually impaired.
However Duplesis also took advantage of the power given to the government by pushing through the Padlock Law, allowing the government to padlock any building that was used for communist meetings or activities for a year. Friedman and Hayek were liberal thinkers who had similar beliefs in economic freedom without government intervention as the ideal economic policy, and suggested a "return to classic liberalism" as best method to encourage growth, decrease unemployment and inflation.
Friedman and Hayek's beliefs influenced major political figures like US President Reagan and Great Britain's PM Thatcher, both whom believed that excessive government involvement in the economy will do more harm than good.
Under this principle both the US and GB drastically cut back on regulation and taxation, and encouraged privatization by selling off government-owned property and Crown Corporations Reaganomics and Thatcherism re-ignited the old beliefs of Adam Smith through the reduction of income and business taxes, as well as reduced regulation on businesses and increased government spending on the public defense system.
Their beliefs in the “trickle-down” economics was based on the idea that both the use of government spending on defense and the tax reliefs would encourage those with capital to invest in the stemming economic growth which would in turn help out the working class, thus helping the economy. While not totally popular amongst the general public, Obama’s fiscal policies have saved General Motors from bankruptcy in 2009 and have allowed General Motors to pick itself up and begin reaping in profits again, best of all without laying off the millions of people working for General Motors, but at the cost of a 49.5 billion dollar bailout using taxpayer's money. Beyond just direct intervention with private companies, Obama continues to sign fiscal policies that promote progressive taxation in order to level the economic disparity amongst the people in the United States.
Obama advocates progressive taxation of the rich slightly more than the middle class in order to fund tax breaks, tax reliefs and social programs that the victims of the economic crisis desperately need. Creation of machinery + mass production
Privatization of property in the form of factory creation by rich independent merchants
Creation of a new middle class/ "Nouveau Riche"
Rapid urbanization of cities
Allowed everyone an equal opportunity to succeed Many skilled workers, craftsman, and farmers were left unemployed due to mass production by machines.
The over-supply of desperate workers and limited government involvement allowed rich factory owners/bourgeoisie to freely exploit them with low wages and poor working conditions
The bourgeoisie had absolute power and were allowed to increased their wealth through illegal means and black market, eventually becoming known as "robber barons". As a result of this freedom in economy, those with the power to took advantage of those unable to speak out so that they could get a competitive edge against other.
Many of the lower classes joined forces in order to protest for their individual rights, forming collectivist groups such as labor unions.
The result of an unregulated economy by means of greed, exploitation, and lack of social security shifted society slightly towards the left-wing of the economic spectrum, where suffrage and individual rights were extended on a broader range. The birth of Modern Liberalism, a time period with a lot more government involvement in the economy; shifting the spectrum towards the center A time closer to classical liberalism than the previous period, with an increase in government deregulation Industrial Revolution [1760-1840] A period of increase in support of government regulation by American workers, and a slight shift to the left of the spectrum HOWEVER... Also in this period: American Revolution (1775-1783)
French Revolution (1787-1799) The industrial revolution greatly influenced the motives for the American and French Revolutions.
As science and technology gave reasoning and doubt to the western societies, they overturned the hierarchical system hoping that by giving more individual freedom to each person they will achieve happiness as a whole. Worker's Unions (late 1800's) T.Roosevelt: Progressivism (1902-1913) Credit Unions (early 1900's) World War I (1914-1918) "The total cost of World War I to the United States (was) approximately $32 billion, or 52 percent of gross national product at the time." The war created major economic boom for the USA via international trade of goods and weapons Civil War in the USSR (1918-1920) Civil war broke out between the "white" and "red" parties of the Soviet Union.
The "red" communist party/Bolsheviks brought fear along with its unified political vision of an extreme collectivist society when it signed the peace treaty with Germany to end the nation's involvement in the war. WWI Lead to US Consumer Peak (1920's) World export of goods gave boom to US economy during the WWI
Even after the first world war there was little unemployment due to the large demand of goods from a recovering Europe.
Rising middle class - consumers
Consumerism allowed technology to exponentially increase standard of living
Changing social values: individual rights was recognized more [woman gains right to suffrage (1918), and the Indian Citizenship Act (1924)] Innovation US innovation and economic success set the newly improvised capitalism of late classic liberal ideals as the world's model of how society should be. 1st Red Scare (1917-1920) Isolationism in America US in the 1920's was perceived as a nation of economic prosperity, who was eager to distance itself from the rest of the world. It advocated the ideal of the equality of opportunity rather than circumstance, and that everyone had a chance, but only those who deserve it would achieve it. The American Deam Relevant Event:
Germany's Inflation Peak (1923) After WWI, Germany is at great financial loss for its forced reparation in the treaty of Versailles and other series of events involving the loss of Ruhr to France.
Hyperinflation quickly set in, where price rose quicker than people could spend their money. Stock Market Crash (1929) Great Depression (1930+) Keynsian Economics FDR's "New Deal" (1933) Agricultural Adjustment Act (1933) - government directly involved in the production and distribution of food. Farmers are paid to grow less food, reducing outputs thus effectively raising the prices of food. The "New Deal" Package: SEC/Securities and Exchange Commission - regulated publicly traded stocks to ensure there was no one taking advantage of the system.
This restores confidence in consumers, also encouraged people to buy stocks. Federal Deposit Insurance Corporation (1933) - insure individual bank deposits and stabilize banking system Interventionalist Policies in Canada (1936-1939) Defeat of Conservatives election in Canada Conservative prime minister was defeated in the election to Mackenzie King, which made the government much more involved in the Canadian economy and created many public institutions and social programs The Great Depression encouraged change in the very right-winged society whom were so fascinated by liberal policies of capitalism.
Under Roosevelt's leadership, western nations adopted a much more government-involved economy, and accepted that government have a very direct role in regulating the markets and the responsibility to protect its people from the abuses of uncontrolled capitalism.
This represents a shift from classical liberalism into modern liberalism World War II (1939-1945) An end to the world's depression and an economic boom for western nations via international trade of goods and weaponry Obama is elected during a time of Economic crisis where people welcomed change and seeked protection and security from the government.
Obama is able to exert a increased level of control from the government and shift the very right-winged American society slightly left towards a mixed economy, so that the majority of the people's needs may be met. Mortgage Crisis (2008) Transition towards a Mixed Economy Credit/Mortgage Crisis (2008) - France, USA, and Canada agreed to government regulating banking systems to prevent abuse by corrupt upper-class
Economic Stimulus Bill (2009) - Obama signs $787 billion bill into law in order to stimulate economy
Patient Protection and Affordable Care Act/ObamaCare (2010) - decrease amount of uninsured Americans and reduce overall cost of healthcare Israeli War and Stagflation (1973) Blair's 3rd Way (1997) however... Reagan's "Trickle Down" Economics:
1 - reduce taxation
2 - reduce regulation
3 - increase military spending Friedman & Hayek Economic data suggest that "trickle-down" economy do not really "trickle down" wealth into the nation.
As the wealthy upper-class became greedy and kept most of the wealth to themselves.
This resulted in a widening income gap between the rich and the poor, as the middle-class slowly start to disappear. Other Relevant Events within the time period 9/11 (2001) - Counter-terrorism spending increased in the US and tax-revenue is spent on funding the War on Terrorism, suggesting more government control.
NAFTA (2002)- encouraged trade within the North American Continent, with reduced tariffs and hence increasing flow of capital, suggesting a shift towards the right of the spectrum with less government regulation and more individual freedom A more pragmatic approach to socialism
Focused on trade unions, public ownership, a strong welfare state, government intervention, and redistribution of wealth
Adopts some Monetarism and free-market policies, while maintaining some social programs
Under Blair's leadership, the government increased spending on healthcare and education, shifting the spectrum slightly towards left