chapter 12 economics and politics. the economy the economy operates in a predictable manner goods:...

Chapter 12

Economics and Politics

The Economy

• The economy operates in a predictable manner

• Goods: Commodities ranging from necessities to luxury items

• Services: Activities that benefit others

• Economies of modern high-income nations are the result of centuries of social change

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Agricultural Revolution

• The earliest societies were hunters and gatherers with no distinct economy

• Economy as a distinct social institution:– Agricultural technology– Job specialization– Permanent settlements– Trade


The Industrial Revolution

• New sources of energies– Steam-fueled machine operation

• Centralization of work in factories– Impersonal factories replaced cottage

industries

• Manufacturing and mass production– Raw materials into a wide range of products


The Industrial Revolution

• Specialization– Diverse division of labor and lower overall skill

requirements

• Wage labor– Working for strangers with intense supervision


The Information Revolution and Postindustrial Society

• Postindustrial economy– System of service work & high-technology

• Information revolution altered fundamental character of work in three ways:– From tangible products to intangible ideas– From mechanical skills to literacy skills– From factories to almost anywhere



The Size of Economic Sectors, by NationalIncome Levels of Country

Sectors of the Economy

• Primary sector– Generates raw materials from environment

• Secondary sector– Transforms raw materials into manufactured

goods

• Tertiary sector– Generates services rather than goods


The Global Economy

• Global economy–Expanding economic activity with little regard to national borders

• This activity has five major consequences:– Global division of labor– Products pass through many nations


The Global Economy

– National governments no longer control the economic activity within their borders

– A small number of businesses now control a vast share of the world’s wealth

– Raises concerns about the rights and opportunities of workers



Agricultural Employment in Global Perspective

Service-Sector Employment in Global Perspective

Capitalism

• “Justice” in a capitalist system amounts to marketplace freedom

• Three distinct features:– Private ownership of property– Pursuit of personal profit– Competition and consumer choice


Socialism

• “Justice” in a socialist context is meeting everyone’s needs in roughly equal manner

• Three distinct features:– Collective ownership of property– Pursuit of collective goals– Government control of the economy


Alternative Systems

• Welfare capitalism– Economic & political system that combines

• Market-based economy & social welfare programs

• State capitalism– An economic & political system; companies

privately owned cooperate closely with govt


Capitalism vs. Socialism

• Economic productivity– GDP is $13,500

• Economic equality– More income disparity

• Personal freedom– Emphasizes freedom to pursue personal self-

interest


Capitalism vs. Socialism

• Economic productivity– GDP is $5,000

• Economic equality– Less income disparity

• Personal freedom– Emphasizes freedom from basic want


Work in the Postindustrial Economy

• The Changing Workplace– In 1900, roughly 40 percent of U.S. workers

were farmers– In 2010, 1.7 percent were employed in

agriculture



The Changing Pattern of Work in the United States, 1900–2011

Work in the Postindustrial Economy

• Labor unions– Organizations of workers that seek to improve

wages & conditions through various strategies– Decline of unions

• Shrinking industrial sector• Service jobs are unlikely to be unionized


Professions

• Theoretical knowledge

• Self-regulated practice

• Authority over clients

• Orientation to community rather than self-interest



The Careers Most Commonly Named as Probable by First-Year College Students, 2010

Self-Employment, Unemployment, and Underemployment

• Self-employment–Earning a living without being on the payroll of a large organization

• Every society has some unemployment.

• Jobs disappear as:– Occupations become obsolete– Businesses change the way they do business– Companies downsize or close


Self-Employment, Unemployment, and Underemployment

• Underemployment: Lower salaries, fewer benefits, and reduced/no pensions

• Many workers agree to cuts in pay and/or benefits



Official U.S. Unemployment Rates for Various Categoriesof Adults, 2011

The Underground Economy

• Most of us occasionally participate in the underground economy in small ways

• Much of the underground economy is due to criminal activity

• Largest segment: people who fail to report legally earned income on their tax returns


The “Jobless Recovery”

• This time around, the recovery in jobs has not been as quick

• More companies have opened factories/offices abroad

• The U.S. economy is simply not growing fast enough


New Information Technology and Work

• Computers are de-skilling labor

• Computers are making work more abstract

• Computers limit workplace interaction

• Computers increase employers' control of workers

• Computers allow companies to relocate work



Projected Increase in the Number of People in the U.S. Labor Force, 2011–2018

Corporations

• Economic Concentration

• Conglomerates and Corporate Linkages

• Corporations: Are They Competitive?

• Corporations and the Global Economy



Where the Jobs Will Be: Projections to 2020

Monarchy

• Constitutional monarchy– Symbolic heads of state– Political principles rule– Elected official actually rules– Examples: Great Britain, Spain, Denmark


Monarchy

• Absolute monarchy– Rulers claiming power based on divine right– Examples: Saudi Arabia, Kuwait, Bahrain


Democracy

• Representative democracy– Authority in hands of elected leaders,

accountable to the people

• The US isn’t truly democratic – Extensive use of unelected bureaucratic

officials


Democracy

– Wealthy have more political clout than the impoverished

• Political economy– The interplay of politics and economics– Capitalist societies claim freedom while

socialist societies claim security



Political Freedom in Global Perspective

Other Political Systems

• Authoritarianism–A political system that denies popular participation in government– Authoritarian government is indifferent to

people’s needs– Examples: Saudi Arabia, Bahrain, Ethiopia


Other Political Systems

• Totalitarianism– A highly centralized political system that

extensively regulates people’s lives– Seeks to bend people to the will of the

government– Vietnam, North Korea



The Size of Government, 2012

The Rise of the Welfare State

• Individualism

• Welfare state–Government agencies and programs provide benefits to population

• One in seven US workers is a government employee

• The US welfare state is still smaller than those of many other high-income nations.


The Political Spectrum

• Ranges from extremely liberal on the left to extremely conservative on the right

• Economic issues

• Social issues

• Class, race, and gender

• Party identification



Left-Right Political Identification of College Students, 1970–2006

Special-Interest Groups

• Special-interest groups – Strong in nations where political parties tend

to be weak– Employ lobbyists to work on their behalf


Special-Interest Groups

• Political action committee (PAC)– Organization formed by a special-interest

group, independent of political parties, to raise • And spend money in support of political goals



The Presidential Election, 2008: Popular Vote by County

Voter Apathy

• Americans are less likely to vote today than a century ago– Half of registered voters participated in 2000

presidential election– Participation rose to 63% in 2008– Women slightly more likely than men to vote


Voter Apathy

– 65+ much more likely to vote than college-age– Non-Hispanic whites more likely to vote than

African Americans– Hispanics least likely to vote (50% voting rate)– People with a bigger stake in US society are

more likely to vote


Voter Apathy

• Conservatives: Apathy is political indifference

• Liberals: Apathy is alienation


Theoretical Analysis of Power in Society

• Pluralist model– Analysis of politics that sees power as spread

among many competing interest groups

• Power-elite model– An analysis of politics that sees power as

concentrated among the rich


Theoretical Analysis of Power in Society

• Marxist political-economy model– An analysis that explains politics in terms of

the operation of a society’s economic system


Political Revolution

• Political revolutions have common traits:

• Rising expectations– Tend to happen when quality of life is

improving

• Unresponsive government– Government unwilling or unable to reform


Political Revolution

• Radical leadership by intellectuals– Thomas Hobbes: Intellectuals provide the

justification for revolution.

• Establishing new legitimacy– Guarding against the counterrevolution


Terrorism

• Violence as legitimate political tactic; bypasses channels of negotiation

• Used by governments & individuals

• Democratic countries especially vulnerable because of broad civil liberties

• One person’s terrorist is another's freedom fighter



Deaths of Americans in Eleven U.S. Wars

War and Peace

• Wright’s five factors that promote war:– Perceived threats

• Threats to people and territory

– Social problems• Internal problems and frustration


War and Peace

– Political objectives• Show of force and protecting one’s own property

– Moral objectives• Rallying people around morality

– Absence of alternatives• Limited options


War and Peace

• Social class and the military

• Is terrorism a new kind of war?– Conventional warfare is symmetrical– Terrorism is asymmetrical


War and Peace

• Nuclear weapons– Nuclear proliferation–Acquisition of nuclear

weapons technology by more & more nations

• The costs and causes of militarism– Military-industrial complex–Association of

federal govt, military, & defense industry– Regional conflict as reason for militarism


War and Peace

• Mass media and war– The power of the mass media to provide

selective information to a worldwide audience – Means television & other media are almost as

important to the outcome of a conflict as the – Military that is doing the actual fighting


Pursuing Peace

• Deterrence– Balance of power between societies

• High-technology defense– Strategic defense initiative


Pursuing Peace

• Diplomacy and disarmament– Keep talking about reducing arms

• Resolving underlying conflict– Increase spending on promoting peace rather

than building up military



Democracy and Islam

chapter 12 economics and politics. the economy the economy operates in a predictable manner goods:...

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pearson education

global perspective

agricultural employment

distinct social institution

distinct economyeconomy

size of economic sectors

mass productionraw materials

national bordersthis