Wednesday, January 27, 2010

WH Honors II: 28 January 2010


Current Events:

An historical retrospective on State of the Union Addresses. Cf.

Ch. 13 Mass Society and Democracy 1870-1914

Section 2 The Emergence of Mass Society

Media Library

Section 3 The National State and Democracy

Media Library

Western Europe and Political Democracy

Great Britain




A Confident Age

Under Victoria, the British middle class—and growing numbers of the working class—felt great confidence in the future. That confidence grew as Britain expanded its already huge empire. Victoria, the empress of India and ruler of some 300 million subjects around the world, became a revered symbol of British might.


From Monarchy to Democracy in Britain

During her reign, Victoria witnessed growing agitation for social reform. The queen herself commented that the lower classes “earn their bread and riches so deservedly that they cannot and ought not to be kept back.” As the Victorian era went on, reformers continued the push toward greater social and economic justice.

In the 1860s, a new era dawned in British politics. The old political parties regrouped under new leadership. Benjamin Disraeli forged the Tories into the modern Conservative Party. The Whigs, led by William Gladstone, evolved into the Liberal Party. Between 1868 and 1880, as the majority in Parliament swung between the two parties, Gladstone and Disraeli alternated as prime minister. Both fought for important reforms.

Expanding Suffrage

Disraeli and the Conservative Party pushed through the Reform Bill of 1867. By giving the vote to many working-class men, the new law almost doubled the size of the electorate.

In the 1880s, it was the turn of Gladstone and the Liberal Party to extend suffrage. Their reforms gave the vote to farm workers and most other men. By century’s end, almost-universal male suffrage, the secret ballot, and other Chartist ambitions had been achieved. Britain had truly transformed itself from a constitutional monarchy to a parliamentary democracy, a form of government in which the executive leaders (usually a prime minister and cabinet) are chosen by and responsible to the legislature (parliament), and are also members of it.
Limiting the Lords

In the early 1900s, many bills passed by the House of Commons met defeat in the House of Lords. In 1911, a Liberal government passed measures to restrict the power of the Lords, including their power to veto tax bills. The Lords resisted. Finally, the government threatened to create enough new lords to approve the law, and the Lords backed down. People hailed the change as a victory for democracy. In time, the House of Lords would become a largely ceremonial body with little power. The elected House of Commons would reign supreme.



The news sent shock waves through Paris. Napoleon III had surrendered to the Prussians and Prussian forces were now about to advance on Paris. Could the city survive? Georges Clemenceau (kleh mahn soh), a young French politician, rallied the people of Paris to defend their homeland:

“Citizens, must France destroy herself and disappear, or shall she resume her old place in the vanguard of nations? . . . Each of us knows his duty. We are children of the Revolution. Let us seek inspiration in the example of our forefathers in 1792, and like them we shall conquer. Vive la France! (Long Live France!)”


Focus Question

What democratic reforms were made in France during the Third Republic?

For four months, Paris resisted the German onslaught. But finally, in January 1871, the French government at Versailles was forced to accept Prussian surrender terms.

The Franco-Prussian War ended a long period of French domination of Europe that had begun under Louis XIV. Yet a Third Republic rose from the ashes of the Second Empire of Napoleon III. Economic growth, democratic reforms, and the fierce nationalism expressed by Clemenceau all played a part in shaping modern France.


Reading Check


What is the principle of ministerial responsibility?

Central and Eastern Europe: The Old Order




Reading Check


What was the role of the Duma in the Russian government?

The United States and Canada (Is Canada a part of the United States?)

Aftermath of the Civil War

Economic differences, as well as the slavery issue, drove the Northern and Southern regions of the United States apart. The division reached a crisis in 1860 when Abraham Lincoln was elected president. Lincoln opposed extending slavery into new territories. Southerners feared that he would eventually abolish slavery altogether and that the federal government would infringe on their states’ rights.

North Versus South

Soon after Lincoln’s election, most southern states seceded, or withdrew, from the Union and formed the Confederate States of America. This action sparked the Civil War, which lasted from 1861 to 1865.

The South had fewer resources, fewer people, and less industry than the North. Still, Southerners fought fiercely to defend their cause. The Confederacy finally surrendered in 1865. The struggle cost more than 600,000 lives—the largest casualty figures of any American war.

Challenges for African Americans

During the war, Lincoln issued the Emancipation Proclamation, by which enslaved African Americans in the South were declared free. After the war, three amendments to the Constitution banned slavery throughout the country and granted political rights to African Americans. Under the Fifteenth Amendment, African American men won the right to vote.

Still, African Americans faced many restrictions. In the South, state laws imposed segregation, or legal separation of the races, in hospitals, schools, and other public places. Other state laws imposed conditions for voter eligibility that, despite the Fifteenth Amendment, prevented African Americans from voting.


By 1900, the United States had become the world's richest nation.


After the Civil War, the United States grew to lead the world in industrial and agricultural production. A special combination of factors made this possible including political stability, private property rights, a free enterprise system and an inexpensive supply of land and labor—supplied mostly by immigrants. Finally, a growing network of transportation and communications technologies aided businesses in transporting resources and finished products.

Business and Labor

By 1900, giant monopolies controlled whole industries. Scottish-born Andrew Carnegie built the nation’s largest steel company, while John D. Rockefeller’s Standard Oil Company dominated the world’s petroleum industry. Big business enjoyed tremendous profits.

Intro to John D. Rockefeller, 2:38

Vocabulary Builder

dominate—(dahm un nayt) vt. to rule or control by superior power or influence

But the growing prosperity was not shared by all. In factories, wages were low and conditions were often brutal. To defend their interests, American workers organized labor unions such as the American Federation of Labor. Unions sought better wages, hours, and working conditions. Struggles with management sometimes erupted into violent confrontations. Slowly, however, workers made gains.

Populists and Progressives

In the economic hard times of the late 1800s, farmers also organized themselves to defend their interests. In the 1890s, they joined city workers to support the new Populist party. The Populists never became a major party, but their platform of reforms, such as an eight-hour workday, eventually became law.

Economics and the Populist Party, 2:24

The American Academy's U.S. History - online high school course.

History Extra Credit: Populist Party, :54

William Jennings Bryan's Cross of Gold Speech, 3:29

High inflation during the American civil war benefited farmers who were debtors and who received high prices for farm products. After the war, the U.S. went back to the gold standard causing general deflation. Various rural-based inflation movements developed. By the early 1890s, the Populist Party and figures within the Democratic and Republican Parties advocated "free silver" (a silver-standard currency at a high price for silver that would bring inflation). The Populists represented an alliance of rural interests and silver mining interests. Free silver advocate William Jennings Bryan became the Democratic presidential candidate of 1896, delivering the famous "Cross of Gold" speech denouncing the gold standard. This is a radio broadcast on the 100th anniversary of the speech which includes a 1923 phonograph recording of excepts from the speech by Bryan. (Bryan ran for president 4 times. He was Secretary of State under Woodrow Wilson for a time. And he became the prosecutor in the Scopes "Monkey Trial" in Tennessee, convicting Scopes for teaching evolution in the public schools.)

By 1900, reformers known as Progressives also pressed for change. They sought laws to ban child labor, limit working hours, regulate monopolies, and give voters more power. Another major goal of the Progressives was obtaining voting rights for women. After a long struggle, American suffragists finally won the vote in 1920, when the Nineteenth Amendment went into effect.


For many Irish families fleeing hunger, Russian Jews escaping pogroms, or poor Italian farmers seeking economic opportunity, the answer was the same—America! A poem inscribed on the base of the Statue of Liberty expressed the welcome and promise of freedom that millions of immigrants dreamed of:
“Give me your tired, your poor,

Your huddled masses yearning to breathe free,

The wretched refuse of your teeming shore.

Send these, the homeless, tempest-tossed to me.

I lift my lamp beside the golden door.”

—Emma Lazarus, “The New Colossus”


Focus Question

How did the United States develop during the 1800s?

In the 1800s, the United States was a beacon of hope for many people. The American economy was growing rapidly, offering jobs to newcomers. The Constitution and Bill of Rights held out the hope of political and religious freedom. Not everyone shared in the prosperity or the ideals of democracy. Still, by the turn of the nineteenth century, important reforms were being made.
Expansion Abroad

U.S. Expansion, 1783–1898

From the earliest years of its history, the United States followed a policy of expansionism, or extending the nation’s boundaries. At first, the United States stretched only from the Atlantic coast to the Mississippi River. In 1803, President Thomas Jefferson bought the Louisiana territory from France. In one stroke, the Louisiana Purchase virtually doubled the size of the nation.

By 1846, the United States had expanded to include Florida, Oregon, and the Republic of Texas. The Mexican War (1846–1848) added California and the Southwest. With growing pride and confidence, Americans claimed that their nation was destined to spread across the entire continent, from sea to sea. This idea became known as Manifest Destiny. Some expansionists even hoped to absorb Canada and Mexico. In fact, the United States did go far afield. In 1867, it bought Alaska from Russia and in 1898 annexed the Hawaiian Islands.


Reading Check


Name the territories acquired by the United States in 1898.

International Rivalries

Reading Check


What countries formed the Triple Alliance and the Triple Entente?

Crisis in the Balkans

Reading Check


Why were the Serbs outraged when Austria-Hungary annexed Bosnia and Herzegovina?

Section 4 Toward the Modern Consciousness

Media Library

Scientific developments of the late-nineteenth and early-twentieth centuries changed the way people saw themselves and their world. Writers, artists, and musicians rebelled against traditional literary and artistic styles and created new ones that sometimes shocked critics with their audacity. Impressionism, cubism, and abstract art emerged. The scientific discoveries of Marie Curie and Albert Einstein, and the psychoanalysis of Sigmund Freud defied the orderly view of reason. Charles Darwin's description of life as a biological struggle for survival led to the Social Darwinism of Herbert Spencer and others. Extreme nationalist ideologies also borrowed from Social Darwinism. Threatening anti-Semitic activity in France, Germany, and Austria-Hungary led many Jews to emigrate to escape persecution. Many Jews immigrated to Palestine, where Zionists were trying to restore Jewish life.

A New Physics

Reading Check


How did Marie Curie's discovery change people's ideas about the atom?

Freud and Psychoanalysis

A thought provoking collection of Creative Quotations from Sigmund Freud (1856-1939); born on May 6. Austrian psychoanalyst; He was the first to develop the concept of the subconscious mind; founded psychoanalysis, 1895-1900.

Psychologist Sigmund Freud demonstrates what a boy will think in his conscious and unconscious when he sees a girl...on the beach. In a fantastically fun and educational way, the psychology legend explains and defines his terms, Id, Ego, and Superego.

This is a stop-motion video of a Sigmund Freud action figure dancing to Bloodhound Gang's "The Bad Touch."

Freudian Slippers: a brand new way of thinking about footwear. Brought to you by the Unemployed Philosophers Guild:

Sigmund Freud On The BBC - 1938 - Brief Audio Clip

Toward the end of his life, Freud was asked by the BBC to provide a brief statement about his decades-long career in psychoanalysis... here, in English, he offers a succinct overview... The "Freud Conflict and Culture" web site said this:

"On December 7, 1938, the British Broadcasting Corporation (BBC) came to Freud's Maresfield Gardens home in London to record a short message. By this time his cancer of the jaw was inoperable and incurable, making speech difficult and extremely painful. A photograph of Freud was taken as he prepared to read the statement you are listening to now. After his long struggle with cancer grew intolerable, Freud asked his physician for a fatal injection of morphine. He died on September 23, 1939."

Late Clips Of Sigmund Freud (1932, 1938)

In these brief clips, psychoanalysis founder Sigmund Freud (1856-1939) is first seen in Vienna in 1932 speaking with archeologist Emanuel Loewy, then in 1938 signing the Royal Society's charter book and lastly celebrating his 81st birthday... the latter clips were taken in London where Freud and his family were forced to move from Vienna following the 1938 Nazi Anschluss (he died in London a year later).

Reading Check


What is Freud's theory of the human unconscious?

Social Darwinism and Racism

Reading Check


What does the theory of social Darwinism state?

Anti-Semitism and Zionism


The most serious and divisive scandal began in 1894. A high-ranking army officer, Alfred Dreyfus, was accused of spying for Germany. However, at his military trial, neither Dreyfus nor his lawyer was allowed to see the evidence against him. The injustice was rooted in anti-Semitism. The military elite detested Dreyfus, the first Jewish person to reach such a high position in the army. Although Dreyfus proclaimed his innocence, he was convicted and condemned to life imprisonment on Devil’s Island, a desolate penal colony off the coast of South America. By 1896, new evidence pointed to another officer, Ferdinand Esterhazy, as the spy. Still, the army refused to grant Dreyfus a new trial.

Deep Divisions

The Dreyfus affair, as it was called, scarred French politics and society for decades. Royalists, ultranationalists, and Church officials charged Dreyfus supporters, or “Dreyfusards,” with undermining France. Paris echoed with cries of “Long live the army!” and “Death to traitors!” Dreyfusards, mostly liberals and republicans, upheld ideals of justice and equality in the face of massive public anger. In 1898, French novelist Émile Zola joined the battle. In an article headlined J’Accuse! (I Accuse!), he charged the army and government with suppressing the truth. As a result, Zola was convicted of libel, or the knowing publication of false and damaging statements. He fled into exile.

Slowly, though, the Dreyfusards made progress and eventually the evidence against Dreyfus was shown to be forged. In 1906, a French court finally cleared Dreyfus of all charges and restored his honors. That was a victory for justice, but the political scars of the Dreyfus affair took longer to heal.

Calls for a Jewish State

The Dreyfus case reflected the rise of anti-Semitism in Europe. The Enlightenment and the French Revolution had spread ideas about religious toleration. In Western Europe, some Jews had gained jobs in government, universities, and other areas of life. Others had achieved success in banking and business, but most struggled to survive in the ghettos of Eastern Europe or the slums of Western Europe.

By the late 1800s, however, anti-Semitism was again on the rise. Anti-Semites were often members of the lower middle class who felt insecure in their social and economic position. Steeped in the new nationalist fervor, they adopted an aggressive intolerance for outsiders and a violent hatred of Jews.

The Dreyfus case and the pogroms in Russia stirred Theodor Herzl (hurt sul), a Hungarian Jewish journalist living in France. He called for Jews to form their own separate state, where they would have rights that were otherwise denied to them in European countries. Herzl helped launch modern Zionism, a movement devoted to rebuilding a Jewish state in Palestine. Many Jews had kept this dream alive since the destruction of the temple in Jerusalem by the Romans. In 1897, Herzl organized the First Zionist Congress in Basel, Switzerland.

Reading Check


Why did Jews start to move to Palestine?

The Culture of Modernity





Social trends in the mid-1800s in France are readily apparent in the works of many of the impressionist artists. The work of Edgar Degas is a good example. In this activity you will learn about impressionism and about the contribution of Degas to a new style in painting and sculpture.

Edgar Degas


* Read the information on the Web site about Degas. Take notes as you read.
* Click on “Life” and read the information.
* Go back and click on “Artistic Styles.” Read the information.
* Click on two of Degas’s paintings and review his works.

Use the information you found to answer the following questions.



Reading Check


How did the Impressionists radically change the art of painting in the 1870s?


Self-check Quiz on Chapter

Vocabulary eFlashcards

Academic Vocabulary


Content Vocabulary

People, Places and Events

Psychoanalysis expert Timothy L. Hulsey, VCU psychology professor and dean of the honors college engages students and faculty in the Core Course and the psychology, MLC and English departments in a general forum on the relationship between Freudian theory and mainstream American psychological science. The conversation includes the impact of early experiences on adult behavior, the nature of memory and conceptions of the self and society: University of Richmond.

"In Memory of Sigmund Freud" by W.H. Auden (poetry reading):

FREUD 01 World of Wonders

Paperback Freud, "Kate"

Paul Warner recording "Freud" in the studio from the album "Deadly Waterparks". Footage produced by Bright Elephant Films.

Emmeline Pankhurst video project, shadow puppet play from Singapore

Suffragette City-David Bowie, "The Rise and Fall of Ziggy Stardust and the Spiders from Mars"

David Bowie - Suffragette City (Live Hammersmith 1973) from the motion picture Ziggy Stardust and the Spiders from Mars

David Bowie - Suffragette City, Imperial College, 12th February 1972

Danny Howells Unreleased Extended Mix of Suffragette City, from Bowie's Ziggy Stardust Album, 7:25

Excerpt from the historical monologue "400 Years of English History" presented by artist/historian George S. Stuart as part of an exhibit of his Historical Figures at the Ventura County Museum of Art and History in Ventura California. Visit the Gallery of Historical Figures online at

This was a project for Mr. Smith's Politics class. It was created by Kyle Detzler, Anne Reinhart, and Cory Weber. We got 90% on it which I personally thought was great.

Hughendon Manor was the home of Benjamin Disraeli (1804 - 1881) from 1848 until his death.
In his early days Disraeli was a traveller who tried to support himself by writing, with varing degrees of success. Most of the time he had money problems until he married a wealthy woman 13 years older than he. Even though she knew he married her for the money, the relationship was very successful and he was heartbroken when she died one year before he became prime minister for the first time in 1868.
His first term was only a few months but his second term is that best known for reforms in a wide range of social areas and the expansion of the British Empire although Disraeli himself had argued some twenty years previously that colonies are a millstone around the neck of a country.
At the Congress of Berlin in 1878, Africa was carved up and Russia stiched up following its victory over the Turks and the independence of states in the Balkans.
Following the British defeat by the Zulus at Isandlwana in 1879 Disraeli was defeated at the general election and Gladstone took over for his second term. Shortly after Disraeli became ill and died.
His election defeat was unfortunate as London had tried to maintain peace in South Africa and Disraeli was furious at the local commander for starting the war and it took Queen Victoria's intervention for him to speak to Lord Chelmsford.

HW email to

1. Refresh your memory by reviewing your notes and Ch. 13 in the textbook.

2. p. 416, #4-6.

AP Economics: 28 January 2010

Third Quarter work will require HW turned in daily to prepare for the Test. We will work on the Free Response type of questions in the third quarter and I will have samples. You should review the earlier chapters (#1-5) to anticipate answering Free Response questions (the HW for tonight and tomorrow as well). I will provide basic procedures for the Test in a presentation as well. Finally, ask in class, while you take good notes, about any material we are covering from the current chapter we study. You have to master the basic grasp of the material now to prepare.

We will have a Test (TBA) on Chapters 16 & 17 for your first Test in the Third Quarter.

We will pick up where we left off: Economic Growth Chapter 17

Chapter Overview

After discussing the classical model, the chapter presents material on the sources
of long-run economic growth (with particular emphasis on productivity growth)
and the importance of infrastructure. The chapter concludes with a section on innovation waves.

Chapter Outline
Productivity Is Important, p. 461
Sources of Productivity Growth, p. 462
Increasing the Capital to Labor Ratio, p. 462
Increasing the Quality of the Labor Force, p. 462
Improvements in Technology, p. 462
Modern Growth Theory, p. 463

What makes this recession different from others we've seen? - Robert Solow, 4:49

How over-leveraged financial institutions turned a housing slump into a global economic crisis (or how a bad mortgage in Oklahoma can sink a bank in Paris).

A Peaceful Method of Conquest? - Paul Romer, 4:45

Complete video at:

Economist Paul Romer uses the Chinese incorporation of Hong Kong as an example of peaceful conquest of territories. Romer argues that similar methods of entry can be used to rebuild troubled nations without the use of war.

His economic theory of history explains phenomena such as the constant improvement of the human standard of living by looking primarily at just two forms of innovative ideas: technology and rules. - The Long Now Foundation

Paul Romer is a Senior Fellow in the Stanford Center for International Development (SCID) and the Stanford Institute for Economic Policy Research (SIEPR). His contributions to the field of economics include being the primary developer of New Growth Theory, which reduces the traditional emphasis on the scarcity of objects and directs attention to the power of new ideas. His theory has brought renewed optimism about the potential for growth in both advanced and developing economies. For his work on the economics of ideas, Paul was named one of America's 25 most influential people by TIME magazine (1997), elected a fellow of the American Academy of Arts and Sciences (2000) and awarded the Horst Claus Recktenwald Prize in Economics (2002). He is a Research Associate of the National Bureau of Economic Research and a Fellow of the Econometric Society.

Checkpoint: Sources of Long-Run Economic Growth
Infrastructure and Economic Growth, p. 465, 7:17

Gov. Rendell discusses infrastructure, job creation on MSNBC's Morning Joe

12.7.09 Governor Ed Rendell (D-PA) discusses infrastructure and jobs on MSNBC's Morning Joe.

Rendell - along with Gov. Schwarzenegger (R-CA) and Mayor Bloomberg (I-NYC) is co-chair of Building America's Future (

Building Americas Future ( is a bipartisan and national organization dedicated to bringing about a new era of U.S. investment in infrastructure that enhances our national prosperity and quality of life. Comprised of state and locally elected officials from around the nation, Building Americas Future seeks to advance a new national vision for infrastructure investment that focuses on economic growth and global competitiveness, job creation, and environmental sustainability.

Public Capital, p. 465
Protection of Property Rights, p. 465, 6:00

Instablogs global Report 28-August-2008

Increasing number of Sri Lankan students traveling overseas for education

The cycle of closures in Sri Lanka universities during the mid and late 90's, created a sudden boom of traveling overseas for study.

Another thing that followed was a large number of new graduates finding employment elsewhere. The reasons are conflict, lack of opportunity, and political instability. On the other, lack of employment opportunities for some specialized fields is further complicating the problem.

In addition to this, Sri Lanka is facing extremely high rate of inflation which is resulting in a high cost of living. While Sri Lanka being a third world country, it could not provide salary scales equal to international rates to those who've paid large amounts of money for their education in other countries.
While economy is struggling due to bad policy, but some of the smart minds of the country are moving away. And while it would be a warm and nice feeling to ask them to stay out of patriotism, Sri Lanka Govt. also need to take steps to stem the flux of talent to other countries.

Malawi struggling hard to secure its economic independence

Despite government's efforts to boost the economic image of the country to global investors, economic freedom in Malawi remains poor. The legislatures have failed miserably to pass economic bills that would have made Malawi more competitive on the international trade arena.
Even politicians have delayed the passing of 2008/9 budget, which has created a climate of uncertainty thus slowing down the donors' inflows. Due to this, overall economic freedom or rather call it freedom to do business, is ranked poorly.

And the worst category for the country is freedom from corruption which is yet another reason that leads it to score poorly irrespective of high fiscal and labor freedom.
Malawi's economic problems, high inflation government subsidies are not widespread. A weak rule of law further jeopardizes the protection of property rights.

With all this going on, it remains a difficult struggle for Malawi to secure its economic independence and to take hold of their own economic destinies.

Israel's education system boosting religious studies

Israel's education is witnessing a change as religious schools get a boost. Students who haven't had a class in math, science, civics or English but only on religious studies believe this will equip them for any subject they might need to tackle later in life.

Cloistered at ultra-Orthodox schools defying the secular teachings that might shake their faith, thousands of Israeli boys and young men study to master the Torah and Talmud.

In a defining battle over the Jewish state's identity, the yeshivas are resisting pressure from secular politicians and educators to teach the basic subjects required at all Israeli secondary schools. They don't want to turn into what they see as "enlightened people who will integrate into Israeli society because of its many temptations."

Secular Israeli see the Haredim as an assault on the rational while the religious talk of a separation of Jews from Judaism and don't want to contaminate their children.

Nevertheless, one thing for sure is the increasing trend of these schools wields disproportionate political clout.

This is Duncan Citizen Journalist from Kenya

Kenya's iconic Maasai Mara is a crown jewel of Kenya's tourism industry. It is haven for migrating wildebeests that come rushing from the nearby nations and was recently considered as a world's "eighth wonder. But the wildlife haven has seen a sharp reduction in the wildebeests because of over-grazing, farming and mass tourism.

Though, Maasai Mara national park is a protected area, but the ecosystem around it is privately owned. In 2000 Kenya govt. move to subdivide land into small plots for Maasai families, the newly-acquired notion of land ownership has led to tensions between neighbors encroaching to find pasture for their livestock.

Whereas restricted for grazing in their shriveled estates, many Maasais opted for wheat farming or simply sold their plots to developers. And both outcomes contributed to choking the natural habitat of the lions and elephants so prized by the world's tourists.

The Maasai had to make a choice because the pastoralist lifestyle was no longer sustainable. The wildlife has one of the best exotic products in the world and it firmly needs commercial and philanthropic models to make the conservancy viable.

Enforcement of Contracts, p. 466, 3:40 discusses the economy in simple and easy terms, and what happens when the government applies irresponsible fiscal policy to the economy. Government, though it may paint a rosy picture, can never help to increase the actual level of prosperity in the nation through the redistribution of wealth. It only occurs when the government backs away from intervention, and focuses on the enforcement of contracts.

Stable Financial System, p. 466, 4:19

The financial system is crashing and action must be taken by the US government to convert debt into equity to produce a more stable environment, Nassim Taleb, author of "The Black Swan," told CNBC.

"You may have green shoots, whatever you want to call them, you may have temporary relief, but you are still in a world that's breaking," Taleb said on "Squawk Box."

Anything that's fragile like the financial system will eventually crash, he said.

"We're in the middle of a crash," Taleb said. "So if I'm going to forecast something, it is that it's going to get worse, not better."

The government needs to deleverage debt and not try stimulus packages that will inflate assets, he said.

"What makes me very pessimistic in not seeing any leadership or awareness on parts of government on what has to be done, which is deleverage $40-to-$70 trillion," Taleb said.

"The monkey on our back is debt," he added.

As an example, Taleb said banks should not be sending demands for larger and larger sums from homeowner in arrears on their mortgage. Instead the bank should offer to lower the monthly payments in return for part-ownership of the property.

"People would be able to start from scratch on a healthy basis. You don't want to wait for foreclosure," he said.

Economic Freedom Index, p. 466

Heritage's Ed Feulner on the 2009 Index of Economic Freedom, 5:53

Letting Be

Entry for the Fraser Institute Student Video Contest of 2009. "Letting Be", creatively examines the question "What is the appropriate role of government in the economy?"

Presented in this video are two of the main competing economic theories of our time, one founded on the concept of government intervention, the other on the principle of economic freedom.

A special focus is placed on illustrating how our lives are severely affected by the choice between the two.

Internet and Economic Freedom Boost Entrepreneurs Worldwide, 3:05

For more than a century entrepreneurs have brought innovation and change to the world. Today, modern technology, looser government controls and better access to capital have made it even easier for entrepreneurs to succeed. VOA's economics correspondent Barry Wood looks at entrepreneurship worldwide, profiling business risk-takers in Africa, the Middle East, the Americas, Asia and Russia.

Checkpoint: Infrastructure and Economic Growth, p. 468
The Changing Face of Innovation Waves, p. 469

Ideas for Your Classroom Audience
The best illustration of the importance of the rate of economic growth is the rule
of 72 (or 70 in some texts). Use different growth rates and illustrate how long it
takes for the GDP in a country to double. Follow this up with Question 7 from the end of-chapter Questions and Problems (the question asks whether a 1.4% growth
rate is so different from a 3.4% growth rate).

The text mentions Somalia as a particular country that has suffered due to its
severe political problems. Take a virtual field trip to Somalia on this website
from BBC News. See the Web site at

Chapter Checkpoints
The Classical Model, p. 470
Question: The classical model relies on competitive markets for labor, products,
and capital to keep the economy near full employment and output. The United
States has enjoyed nearly 3 decades of high employment, high growth, and low
inflation, interrupted by two short and mild recessions. Has the recent growth in
globalization and trade liberalization introduced more competition into labor, capital, and product markets, making our economy look and act like classical economists envisioned?

The point is to check that students can: relate their understanding of the classical model to changes in the global economy.

Sources of Long-Run Economic Growth, p. 470
Question: In 2006, Warren Buffett, the world's second richest individual, announced that over the next few years he would be giving 85% of his wealth, over $30 billion, to the Bill and Melinda Gates Foundation. The foundation focuses on grants to developing nations, helping the poorest of the poor. What suggestions would you give the Foundation to help these developing nations grow?

The point is to check that students can: relate the factors that affect long-run economic growth to the activities of a foundation like the Gates Foundation.

Infrastructure and Economic Growth, p. 470
Question: Imagine a country with a “failed government” that can no longer enforce
the law. Contracts are not upheld and lawlessness is the order of the day. How could an economy operate and grow in this environment?

The point is to check that students can: understand how important the legal framework is to economic growth.

Extended Examples in the Chapter
The Changing Face of Innovation Waves
Looking back to Schumpeter’s creative destruction, this section argues that the time between waves of innovation is becoming shorter. It cites the work of William
Baumol, who contends that capitalism’s ability to produce a steady stream of new
ideas and processes has made capitalism the most efficient growth machine and the
best economic system for generating growth.
The sources cited for this section are “Catch the Wave: The Long Cycles of
Industrial Innovation are Becoming Shorter,” from The Economist, February 19,
1999, and The Free-Market Innovation Machine: Analyzing the Growth Miracle of
Capitalism, by William J. Baumol (Princeton: Princeton University Press, 2002).

Examples Used in the End-of-Chapter Questions
Questions 4 and 7 reference growth rates in different countries. Question 11 references per capita income (or output). To learn more about growth rates and per
capita income in different countries, visit the CIA Factbook Web site at
For Further Analysis
Immigration: Good or Bad for Productivity?
The example provided in the student handout can be used as a small group exercise
or as an individual exercise. It is also suitable to use as the basis for a classroom debate. The exercise expands on the chapter’s coverage of the sources of long-run economic growth by exploring the issue of immigration. Students are directed to read two articles about different “types” of workers and use them as a basis for analyzing the impact of immigration.

See the paper on guest-worker programs by Mark Krikorian, executive
director of the Center for Immigration Studies for a presentation of this viewpoint.

Web-Based Exercise
This example requires students to compare two different measures of economic
freedom and to assess what aspects of economic freedom they feel are most important.

This assignment builds on the discussion on the text and also provides an
opportunity to discuss the effects of corruption on economic growth.

The Dimensions of Economic Freedom
Visit the Web site of the Fraser Institute to read its Economic Freedom of the World report. Compare it with the Index of Economic Freedom (from the Heritage
Foundation and The Wall Street Journal) by answering the following:
1) Which are the top ten countries according to each source? (Web sites are and http://www. 2) What categories are included in each definition of freedom? (You may consult the list of categories in the text for the Fraser Institute; for the Heritage Foundation, see the Web site at

The challenge with regard to this material is how much students may take for
granted about their freedoms and the economy in which they live. Trying to give
them another perspective will help them understand the strengths of the U.S. economy and the challenges of other countries.


Immigration: Good or Bad for Productivity?
Growth in the labor force is listed as a major source of long-run economic growth. But what causes the labor force to grow? As noted in the text, immigration is causing the U.S. population to rise faster than anyone thought. Is this good for productivity?

Read the article titled “Keeping Out the Wrong People: Tightened Visa Rules Are Slowing the Vital Flow of Professionals into the U.S.” by Spencer E. Ante in Business Week (October, 2004, pp. 90–94, available on the Web at:

Then read “The Worker Next Door,” by Barry R. Chiswick in The New York Times, June 3, 2006, p. A23. This article is available on the Web at:

Based on the two articles, assess whether immigration is good or bad for U.S. productivity.

"Mankiw's 10 principles of economics, translated for the uninitiated", by Yoram Bauman, . Presented at the AAAS humor session, February 16, 2007. For the record, the talk contains two unattributed quotes ("9 out of 5" is adapted from a line attributed to Paul Samuelson---although apparently he said it about Wall Street indices, not macroeconomists---and "wrong about things" is paraphrased from P.J. O'Rourke's Eat the Rich) and, of course, the Einstein "simple" quote is an intentional misquote. The talk is based on a published article in Annals of Improbable Research (see ), which sponsored my talk and to which you should subscribe ( ). In the paper you can see the "constructive example" of how trade can make everyone worse off (or you can just wait 50 years to see what happens with climate change). More info and other clips on my website ( ), and please sign up for my email list.

William Baumol. - Air date: 06-12-99

William Jack Baumol (born February 26, 1922) is a New York University economics professor (although he is also affiliated with Princeton University) who has written extensively about labor market and other economic factors that affect the economy. He also made valuable contributions to the history of economic thought. He is among the 500 best economists in the world according to IDEAS/RePEc.
Among his better-known contributions are the theory of contestable markets, the Baumol-Tobin model of transactions demand for money, Baumol's cost disease, which discusses the rising costs associated with service industries, and Pigou taxes.[1]
The 2006 Annual Meetings of the American Economic Association held a special session in his name, and honoring his many years of work, where 12 papers on entrepreneurship were presented.
The British magazine, The Economist published an article about William Baumol and his lifelong work to develop a place in economic theory for the entrepreneur (March 11, 2006, pp 68), much of which owes its genesis to Joseph Schumpeter. They note that traditional microeconomic theory holds a place for 'prices' and 'firms' but not for that (seemingly) important engine of innovation, the entrepreneur. Baumol is given credit for helping to remedy this shortcoming: "Thanks to Mr. Baumol's own painstaking efforts, economists now have a bit more room for entrepreneurs in their theories."
Baumol is a trustee of the Economists for Peace and Security.

Email HW to

1. Study and review the earlier chapters (#1-5) to anticipate answering Free Response questions (the HW for tonight and tomorrow as well) for the Test.

2. You should double the class time on a daily basis in preparing for the Test. Master the definitions now to prepare. Answer all questions (at the end of the chapters) in the text.

3. Begin to review any AP Macroeconomics test study texts. They are all about the same but they provide samples and answers to study.