Capitalism and Socialism

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Capitalism and Socialism발음듣기

Today we're going to talk about capitalism.발음듣기

Yeah, Mr. Green, capitalism just turns men into wolves.발음듣기

Your purportedly free markets only make slaves of us all.발음듣기

Oh god, Stan, it's me from college.발음듣기

Me from the past has become me from college. This is a disaster.발음듣기

The reason he's so unbearable, Stan, is that he refuses to recognize the legitimacy of other people's narratives, and that means that he will never, ever be able to have a productive conversation with another human in his entire life.발음듣기

Listen, me from the past, I'm going to disappoint you by being too capitalist, and I'm going to disappoint a lot of other people by not being capitalist enough, and I'm going to disappoint the historians by not using enough jargon.발음듣기

What can I do? We only have 12 minutes.발음듣기

Fortunately, capitalism is all about efficiency, so let's do this, me from college.발음듣기

Randy Riggs becomes a best-selling author, Josh Radnor stars in a great sit-com, it is not going to work out with Emily and do not go to Alaska with a girl you've known for 10 days.발음듣기

Okay, let's talk capitalism. (music) Capitalism is an economic system, but it's also a cultural system.발음듣기

It's characterized by innovation and investment to increase wealth.발음듣기

Today we're going to focus on production and how industrial capitalism changed it.발음듣기

Stan, I can't wear these emblems of the bourgeoisie while Karl Marx himself is looking at me, it's ridiculous. I'm changing.발음듣기

Very hard to take off a shirt dramatically. Let's say it's 1200 C.E.발음듣기

And you're a rug merchant.발음듣기

Just like merchants today you sometimes need to borrow money in order to buy the rugs you want to resell at a profit, and then you pay that money back often with interest once you've resold the rugs. This is called mercantile capitalism.발음듣기

It was a global phenomenon from the Chinese to the Indian Ocean trade network to Muslim merchants who would sponsor trade caravans across the Sahara.발음듣기

By the 17th century, merchants in the Netherlands and in Britain had expanded upon this idea to create joint stock companies.발음듣기

Those companies could finance bigger trade missions and also spread the risk of international trade.발음듣기

The thing about international trade is sometimes boats sink, or they get taken by pirates.발음듣기

While that's bad if you're a sailor, because, you know, you lose your life, it's really bad if you're a mercantile capitalist because you lost all your money.발음듣기

But if you own one-tenth of ten boats, your risk is much better managed.발음듣기

That kind of investment definitely increased wealth, but it only affected a sliver of the population and it didn't create a culture of capitalism.발음듣기

Industrial capitalism was something altogether different, both in scale and in practice.발음듣기

Let's use Joyce Appleby's definition industrial capitalism: An economic system that relies on investment of capital in machines and technology that are used to increase production of marketable goods.발음듣기

Imagine that someone made a Stan machine.발음듣기

By the way, Stan, this is a remarkable likeness.발음듣기

That Stan machine could produce and direct ten times more episodes of Crash Course than a human Stan.발음듣기

Of course, even if there are significant up-front costs, I'm going to invest in the Stan machine so I can start cranking out ten times the knowledge.발음듣기

Stan are you focusing on the robot instead of me?발음듣기

I am the star of this show!발음듣기

Stan, bud, you're going behind the globe.발음듣기

When most of us think about capitalism, especially when we think about its down sides; long hours, low wages, miserable working conditions, child labor, unemployed Stans, that's what we're thinking about.발음듣기

Now admittedly, this is just one definition of industrial capitalism among many, but it's the definition we'ere going with.발음듣기

Industrial capitalism developed first in Britain in the 19th century.발음듣기

Britain had a bunch of advantages.발음듣기

It was the dominant power on the seas and it was making good money off of trade with its colonies, including the slave trade.발음듣기

Also, the growth of capitalism was helped by the half-century of civil unrest that resulted from the 17th century English civil war.발음듣기

Now, I'm not advocating for civil wars or anything, but in this particular case, it was useful.발음듣기

Before the war the British Crown had put a lot of regulations on the economy; complicated licenses, Royal monopolies, etc., but during the turmoil it couldn't enforce them which made for freer markets.발음듣기

Another factor was a remarkable increase in agricultural productivity in the 16th century.발음듣기

As food prices started to rise, it became profitable for farmers, both large and small, to invest in agricultural technologies that would improve crop yields.발음듣기

Those higher prices for grain probably resulted from population growth, which in turn was encouraged by increased production of food crops.발음듣기

A number of these agricultural improvements came from the Dutch who had chronic problems feeding themselves and discovered that planting different kinds of crops, like clover, that added nitrogen to the soil and can be used to feed livestock at the same time, meant that more fields could be used at once.발음듣기

This increased productivity eventually brought down prices, and this encouraged further innovation in order to increase yield to make up for the drop in prices.발음듣기

Lower food prices had an added benefit.발음듣기

Since food cost less and wages in England remained high, workers would have more disposable income, which meant that if there were consumer goods available, they would be consumed, which incentivized people to make consumer goods more efficiently, and therefore more cheaply.발음듣기

You can see how this positive feedback loop leads to more food and more stuff, culminating in a world where people have so much stuff that we must rent space to store it, and so much food that obesity has become a bigger killer than starvation. Thanks thought bubble.발음듣기

This increased productivity also meant that fewer people needed to work in agriculture in order to feed the population.발음듣기

To put this in perspective, in 1520, 80% of the English population worked the land.발음듣기

By 1800, only 36% of adult male laborers were working in agriculture.발음듣기

By 1850, that percentage had dropped to 25.발음듣기

This meant that when the factories started humming, there were plenty of workers to hum along with them, especially child laborers.발음듣기

(John makes vocal wer-wer-wer sound) So far all this sounds pretty good, right?발음듣기

I mean except for the child labor.발음듣기

Who wouldn't want more, cheaper food? Yeah, well, not so fast.발음듣기

One of the ways the British achieved all this agricultural productivity was through the process of enclosure, whereby landlords would reclaim and privatize fields that for centuries had been held in common by multiple tenants.발음듣기

This increased agricultural productivity, but it also impoverished many tenant farmers, many of whom lost their livelihoods.발음듣기

Okay, for our purposes, capitalism is also a cultural system rooted in the need of private investors to turn a profit.발음듣기

The real change needed here was a change of mind.발음듣기

People had to develop the capitalist values of taking risks and depreciating innovation.발음듣기

They had to come to believe that making an up-front investment in something like a Stan machine could pay for itself and then some.발음듣기

One of the reasons that these values developed in Britain was that the people who initially held them were really good at publicizing them.발음듣기

Writers like Thomas Mun who worked for the English East India Company exposed people to the idea that the economy was controlled by markets.발음듣기

Other writers popularized the idea that it was human nature for individuals to participate in markets as rational actors. Even our language changed.발음듣기

The word "individuals" did not apply to persons until the 17th century.발음듣기

In the 18th century, a "career" still referred only to horses' racing lives.발음듣기

Perhaps the most important idea that was popularized in England was that men and women were consumers as well as producers, and that this was actually a good thing because the desire to consume manufactured goods could spur economic growth.발음듣기

The main spur to trade, or rather to industry and ingenuity, is the exorbitant appetite of men, "which they will take pain to gratify."발음듣기

So wrote John Cary, one of capitalism's cheerleaders, in 1695.발음듣기

In talking about our appetites, he wasn't just talking about food.발음듣기

That doesn't seem radical now, but it sure did back then.발음듣기

Here in the 21st century it's clear that industrial capitalism, at least for now, has won.발음듣기

Sorry, buddy, but you gave it a good run.발음듣기

You didn't know about Stalin. Capitalism isn't without its problems or its critics.발음듣기

There were certainly lots of shortcomings to industrial capitalism in the 19th century. Working conditions were awful.발음듣기

Days were long, arduous and monotonous.발음듣기

Workers lived in conditions that people living in the developed world today would associate with abject poverty.발음듣기

One way that workers responded to these conditions was by organizing into labor unions.발음듣기

Another response was in many cases purely theoretical; socialism, mostly famously Marxian socialism.발음듣기

I should probably point out here that socialism is an imperfect opposite to capitalism even though the two are often juxtaposed.발음듣기

Capitalism's defenders like to point out that it's natural, meaning that if left to our own devices humans would construct economic relationships that resemble capitalism.발음듣기

Socialism, at least in its modern incarnations, makes fewer pretenses toward being an expression of human nature.발음듣기

It's the result of human choice and human planning.발음듣기

Socialism as an intellectual construct began in France.발음듣기

How'd I do, Stan? In the border between Egypt and Lybia!발음듣기

There were two branches of socialism in France; utopian and revolutionary.발음듣기

Utopian socialism is often associated with Comte de Saint Simon and Charles Fourier, both of whom rejected revolutionary action after having seen the disaster of the French Revolution. Both were critical of capitalism.발음듣기

While Fourier is usually a punchline in history classes because he believed that in his ideal socialist world the seas would turn to lemonade, he was right that human beings have desires that go beyond basic self interest and that we aren't always economically rational actors.발음듣기

The other French socialists were the revolutionaries, and they saw the French Revolution, even its violence, in a much more positive light.발음듣기

The most important of these revolutionaries was Auguste Blanqui.발음듣기

We associate a lot of his ideas with communism, which was a term that he used.발음듣기

Like the utopians, he criticized capitalism, but he believed that it could only be overthrown through violent revolution by the working classes.발음듣기

However, while Blanqui thought that the workers would come to dominate a communist world, he was an elitist, and he believed that workers could never, on their own, overcome their superstitions and their prejudices in order to throw off bourgeoisie oppression.발음듣기

That brings us to Carl Marx, whose ideas and beard cast a shadow over most of the 20th century.발음듣기

(harp music) An open letter to Carl Marx's beard.발음듣기

Oh, Robot? Stanbot? Two Stanbots, one of the female!발음듣기

Now I own all the means of production!발음듣기

You're officially useless to me, Stan.발음듣기

Now turn the camera off. I'm going to have to get up and turn the camera off?발음듣기

Stanbot, go turn the camera off. Hey there, Carl Marx's beard.발음듣기

Wow! You are intense. Carl Marx, these days there are a lot of young men who think beards are cool, beard-lovers if you will.발음듣기

Those aren't beards, they're glorified milk mustaches.발음듣기

I haven't shaved for a couple weeks, Carl Marx, but I'm not claiming a beard.발음듣기

You don't get a beard by being lazy.발음듣기

You get a beard by being a committed revolutionary.발음듣기

That's why hardcore Marxists are literally known as bearded Marxists. These days that's an insult.발음듣기

But you know what, Carl Marx?발음듣기

When I look back at history, I prefer the bearded Communists.발음듣기

Let's talk about some Communists that didn't have beards.발음듣기

Mao Tse Tung, Pol Pot, Kim Jong Il, Joseph freaking Stalin with his face caterpillar.발음듣기

So, yeah, Carl Marx's beard, it's my great regret to inform you that there are some paltry beards trying to take up the class struggle these days.발음듣기

Best wishes, John Green. Although he's often considered the father of Communism because he co-wrote the Communist Manifesto, Marx was above all a philosopher and a historian.발음듣기

It's just that unlike most philosophers and historians, he advocated for revolution.발음듣기

His greatest work, Das Kapital, sets out to explain the world of the 19th century in historical and philosophical terms.발음듣기

Marx's thinking is deep and dense and we're low on time, but I want to introduce one of his ideas; that of class struggle.발음듣기

For Marx, the focus isn't on the class, it's on the struggle.발음듣기

Basically, Marx believed that classes don't only struggle to make history, but that the struggle is what makes classes into themselves.발음듣기

The idea is that through conflict, classes develop a sense of themselves and without conflict there is no such thing as class consciousness.발음듣기

Marx was writing in 19th century England.발음듣기

There were two classes that mattered; the workers and the capitalists.발음듣기

The capitalists owned most of the factors of production; in this case, land and the capital to invest in factories. Workers just had their labor.발음듣기

So the class struggle here is between capitalists who want labor at the lowest possible price and the workers who want to be paid as much as possible for their work.발음듣기

There are two key ideas that underlie this theory of class struggle.발음듣기

First, Marx believed that production, or work, was the thing that gave life material meaning.발음듣기

Second, is that we are by nature social animals.발음듣기

We work together, we collaborate, we are more efficient when we share resources.발음듣기

Marx's criticism of capitalism is that capitalism replaces this egalitarian collaboration with conflict, and that means that it isn't a natural system after all.발음듣기

By arguing that capitalism actually isn't consistent with human nature, Marx sought to empower the workers.발음듣기

That's a lot more attractive than Blanqui's elitist socialism.발음듣기

While purportedly Marxist states, like the U.S.S.R., usually abandon worker empowerment pretty quickly, the idea of protecting our collective interest remains powerful.발음듣기

That's where we'll leave it for now lest I start reading from the Communist Manifesto.발음듣기

Ultimately, socialism has not succeeded in supplanting capitalism as its proponents had hoped.발음듣기

In the United States, at least, socialism has become something of a dirty word.발음듣기

Industrial capitalism certainly seems to have won out, and in terms of material well-being and access to goods and services for people around the world, that's probably a good thing. Ah, you keep falling over.발음듣기

You're a great bit, but a very flimsy one.발음듣기

Actually, come to think of it, you're more of an eight-bit.발음듣기

How and to what extent we use socialist principles to regulate free markets remains an open question, and one that is answered very differently in, say, Sweden than in the United States.발음듣기

This, I would argue, is where Marx still matters.발음듣기

Is capitalist competition natural and good, or should there be systems in place to check it for the sake of our collective well being?발음듣기

Should we ban together to provide healthcare for the sick or pensions for the old?발음듣기

Should governments run businesses? If so, which ones?발음듣기

The mail delivery business? The airport security business?발음듣기

The education business? Those are the places where industrial capitalism and socialism are still competing.발음듣기

In that sense, at least, the struggle continues.발음듣기

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