Monday, September 20, 2010

Honors World History II: 21 September 2010

Prayer

Current Events:

Row over France and Roma deportations rumbles on (19 Sept. '10)


The continuing row over the clearing up of illegal camp sites around France, who by coincidence are mostly run by Roma Gypsy's.

Recorded from Channel 4 News, 19 September 2010.

Chapter 10: Revolution and Enlightenment, 1550–1800, Section 2 The Enlightenment

The Scientific Revolution gave rise to the Enlightenment, an eighteenth-century movement that stressed the role of philosophy and reason in improving society. Enlightenment intellectuals, known as philosophes, were chiefly social reformers from the nobility and the middle class. They often met in the salons of the upper classes to discuss the ideas of such giants as Montesquieu, Voltaire, and Diderot. In the economic sphere, Adam Smith put forth the doctrine of laissez-faire economics. The later Enlightenment produced social thinkers such as Jean-Jacques Rousseau and an early advocate of women's rights, Mary Wollstonecraft. Salon gatherings, along with the growth of book and magazine publishing, helped spread Enlightenment ideas among a broad audience. Most Europeans were still Christians. However, the desire for a more spiritual experience inspired new religious movements, such as the Methodism of John Wesley.

Terms, People, and Places

I created a new page: Honors World History II Fall 2010 Chapter 10 Section 2 The Enlightenment on our Shanawiki (Cf. http://shanawiki.wikispaces.com/) site.

Voltaire
François-Marie Arouet, pictured here and known as Voltaire (1694–1778) was an impassioned poet, historian, essayist, and philosopher who wrote with cutting sarcasm and sharp wit. Voltaire was sent to the Bastille prison twice due to his criticism of French authorities and was eventually banned from Paris. When he was able to return to France, he wrote about political and religious freedom. Voltaire spent his life fighting enemies of freedom, such as ignorance, superstition, and intolerance.


Probably the most famous of the philosophes was François-Marie Arouet, who took the name Voltaire. “My trade,” said Voltaire, “is to say what I think,” and he did so throughout his long, controversial life. Voltaire used biting wit as a weapon to expose the abuses of his day. He targeted corrupt officials and idle aristocrats. With his pen, he battled inequality, injustice, and superstition. He detested the slave trade and deplored religious prejudice.

Heated Debate

Rousseau (left) and Voltaire (right) are pictured here in the midst of an argument. Even though the philosophes were reform-minded, they disagreed about some issues. The important point is that the Enlightenment tradition indicated that reasonable, rational people could dispute without killing one another. Debate, disagreement, and dialogue, along with the use of reason was emphasized.

Voltaire’s outspoken attacks offended both the French government and the Catholic Church. He was imprisoned and forced into exile. Even as he saw his books outlawed and even burned, he continued to defend the principle of freedom of speech.

Diderot


Enlightenment thinker Denis Diderot (dee duh roh) compiled a controversial 28-volume work called the Encyclopedia, which was published between 1751 and 1772. This work was a forum for Enlightenment thinkers such as Montesquieu, Rousseau, and Voltaire. These thinkers believed that with the power of reason, they could fix the problems of society. Although the Encyclopedia was banned in many places and censored in others, it would prove to be a major factor in the years of revolutions to come. It contains the passage below on freedom.

“No man has received from nature the right to give orders to others. Freedom is a gift from heaven, and every individual of the same species has the right to enjoy it as soon as he is in enjoyment of his reason.”

—Denis Diderot
As the editor, Diderot did more than just compile articles. His purpose was “to change the general way of thinking” by explaining ideas on topics such as government, philosophy, and religion. In these articles, the philosophes denounced slavery, praised freedom of expression, and urged education for all. They attacked divine-right theory and traditional religions. Critics raised an outcry. The French government argued that the Encyclopedia was an attack on public morals, and the pope threatened to excommunicate Roman Catholics who bought or read the volumes.

Despite these and other efforts to ban the Encyclopedia, more than 4,000 copies were printed between 1751 and 1789. When translated into other languages, the Encyclopedia helped spread Enlightenment ideas throughout Europe and across the Atlantic Ocean to the Americas.

Reading Check

Comparing

What were the major contributions of Montesquieu, Voltaire, and Diderot to the Enlightenment?

Toward a New Social Science
French thinkers known as physiocrats focused on economic reforms. Like the philosophes, physiocrats based their thinking on natural laws. The physiocrats claimed that their rational economic system was based on the natural laws of economics.

Economics

Physiocrats rejected mercantilism, which required government regulation of the economy to achieve a favorable balance of trade. Instead, they urged a policy of laissez faire (les ay fehr), allowing business to operate with little or no government interference. Physiocrats also supported free trade and opposed tariffs.

Scottish economist Adam Smith greatly admired the physiocrats. In his influential work The Wealth of Nations, he argued that the free market should be allowed to regulate business activity. Smith tried to show how manufacturing, trade, wages, profits, and economic growth were all linked to the market forces of supply and demand. Wherever there was a demand for goods or services, he said, suppliers would seek to meet that demand in order to gain profits. Smith was a strong supporter of laissez faire. However, he felt that government had a duty to protect society, administer justice, and provide public works. Adam Smith’s ideas would help to shape productive economies in the 1800s and 1900s.

Power of the Market - Invisible Hand, 1:14

In-class assignment: How does an invisible hand guide economic activity in a free market according to Adam Smith?

Email or hand-in with your HW for the day.


Milton Friedman explains how an invisible hand guides economic activity in a free market.

Investors in Paris, France, 1720



Beccaria and Justice

Reading Check

Explaining

What is the concept of laissez-faire?

The Later Enlightenment

Jean-Jacques Rousseau (roo soh) and quill pen



Rousseau Stirs Things Up: Cf. http://www.pearsonsuccessnet.com/snpapp/iText/products/0-13-133374-7/audio.html?fname=audio/audio_WH07Y03728.mov

In Jean-Jacques Rousseau’s most important work, The Social Contract (1762), he argued that in order to be free, people should do what is best for their community, as people freely express themselves. Rousseau felt that society placed too many limitations on people’s behavior. He believed that some controls were necessary, but that they should be minimal. Additionally, only governments that had been freely elected should impose these controls. Rousseau had many supporters who were inspired by his passionate writings. European monarchs, on the other hand, were angry that Rousseau was questioning authority. In fact, he was questioning their authority. As a result, Rousseau worried about persecution for much of his life.

The “chains” in the quote from Rousseau below represent the social institutions that confined society.

“Man is born free, and everywhere he is in chains.”

—Rousseau, The Social Contract

Creative Quotations from Jean Jacques Rousseau, 1:11

In-class assignment: paraphrase one of Rousseau's statements in your own words (email/hand in with the daily HW).


A thought provoking collection of Creative Quotations from Jean Jacques Rousseau (1712-1778); born on Jun 28. French philosopher, educational reformer, author; He was an influential educational reformer; His teacher-student contract changed education.

Rousseau believed that people in their natural state were basically good. This natural innocence, he felt, was corrupted by the evils of society, especially the unequal distribution of property. Many reformers and revolutionaries later adopted this view. Among them were Thomas Paine and Marquis de Lafayette, who were leading figures of the American and French Revolutions.

Reading Check

Summarizing

What were Rousseau's basic theories as presented in The Social Contract and Emile?

Thomas Hobbes and John Locke, two seventeenth-century English thinkers, set forth ideas that were to become key to the Enlightenment. Both men lived through the upheavals of the English Civil War. Yet they came to very different conclusions about human nature and the role of government.

Audio Background: Hobbes and Locke Have Conflicting Views

Cf. http://www.pearsonsuccessnet.com/snpapp/iText/products/0-13-133374-7/audio.html?fname=audio/audio_WH_C17S1c.mov

Thomas Hobbes outlined his ideas in a work titled Leviathan. In it, he argued that people were naturally cruel, greedy, and selfish. If not strictly controlled, they would fight, rob, and oppress one another.

Hobbes' most important quote follows:

Life in the “state of nature”—without laws or other control—would be “solitary, poor, nasty, brutish, and short.”

To escape that “brutish” life, said Hobbes, people entered into a social contract, an agreement by which they gave up their freedom for an organized society. Hobbes believed that only a powerful government could ensure an orderly society. For him, such a government was an absolute monarchy, which could impose order and compel obedience.

The title page, pictured here, from Leviathan (1651) by Hobbes demonstrates his belief in a powerful ruler. The monarch here represents the Leviathan who rises above all of society.


On the other hand, John Locke (1632–1704) had a more optimistic view of human nature than did Hobbes. He thought people were basically reasonable and moral. Further, they had certain natural rights, or rights that belonged to all humans from birth. These included the right to life, liberty, and property.

John Locke and a book of his writings

In Two Treatises of Government (1690), Locke argued that people formed governments to protect their natural rights. The best kind of government, he said, had limited power and was accepted by all citizens. Thus, unlike Hobbes, Locke rejected absolute monarchy. England during this time experienced a shift in political power known as the Glorious Revolution. James II, an unpopular absolute monarch, left the throne and fled England in 1688. Locke later wrote that he thought James II deserved to be dethroned for violating the rights of the English.

Locke's Influence on American Constitutional Ideas: Life, Liberty, and Property (the pursuit of happiness)

Locke proposed a radical idea about this time. A government, he said, has an obligation to the people it governs. If a government fails its obligations or violates people’s natural rights, the people have the right to overthrow that government. Locke’s idea would one day influence leaders of the American Revolution, such as Benjamin Franklin, Thomas Jefferson, and James Madison. Locke’s idea of the right of revolution would also echo across Europe and Latin America in the centuries that followed.

The reason why men enter into society is the preservation of their property; and the end while they choose and authorize a legislature is that there may be laws made, and rules set, as guards and fences to the properties of all the society.

"Whensoever, therefore, the legislative [power] shall transgress this fundamental rule of society, and either by ambition, fear, folly, or corruption, endeavor to grasp themselves, or put into the hands of any other, an absolute power over the lives, liberties, and estates of the people, by this breach of trust they forfeit the power the people had put into their hands for quite contrary ends, and it devolves5 to the people; who have a right to resume their original liberty, and by the establishment of a new legislative (such as they shall think fit), provide for their own safety and security. . . .”

John Locke

In-class assignment

Thinking Critically

1. Draw Inferences

According to Locke, how should a land be governed? Why do you think this is the case?

2. Identify Central Issues

What does Locke say can happen if a government fails to protect the rights of its people?

Rights of Women
The Enlightenment slogan “free and equal” did not apply to women. Though the philosophes said women had natural rights, their rights were limited to the areas of home and family.

By the mid- to late-1700s, a small but growing number of women protested this view. Germaine de Staël in France and Catharine Macaulay and Mary Wollstonecraft in Britain argued that women were being excluded from the social contract itself. Their arguments, however, were ridiculed and often sharply condemned.

Creative Quotations from Mary Wollstonecraft Shelley, 1:26

In-class assignment: paraphrase one of Wollstonecraft's sayings in your own words and email/hand-in with your daily HW.


A thought provoking collection of Creative Quotations from Mary Wollstonecraft Shelley (1797-1851); born on Aug 30. English author; She is best known as the creator and author of "Frankenstein," 1818.

Wollstonecraft was a well-known British social critic. She accepted that a woman’s first duty was to be a good mother but felt that a woman should be able to decide what was in her own interest without depending on her husband. In 1792, Wollstonecraft published A Vindication of the Rights of Woman. In it, she called for equal education for girls and boys. Only education, she argued, could give women the tools they needed to participate equally with men in public life.

Reading Check

Evaluating

How did Mary Wollstonecraft use the Enlightenment ideal of reason to advocate rights for women?

Social World of the Enlightenment

The Growth of Reading

The Salon

New literature, the arts, science, and philosophy were regular topics of discussion in salons, or informal social gatherings at which writers, artists, philosophes, and others exchanged ideas. The salon originated in the 1600s, when a group of noblewomen in Paris began inviting a few friends to their homes for poetry readings. By the 1700s, some middle-class women began holding salons. Here middle-class citizens could meet with the nobility on an equal footing to discuss and spread Enlightenment ideas.

Madame Geoffrin (zhoh fran, far right in blue), in her famous salon where Enlightenment thinkers gathered to share ideas.


Madame Geoffrin (zhoh fran) ran one of the most respected salons. In her home on the Rue St. Honoré (roo sant ahn ur ay), she brought together the brightest and most talented people of her day. The young musical genius Wolfgang Amadeus Mozart played for her guests, and Diderot was a regular at her weekly dinners for philosophers and poets.

Reading Check

Examining

What was the importance of salons?

Religion in the Enlightenment

John Wesley Sermon: Thoughts on War, 5:30

In-class assignment: in your own words, summarize Wesley's sermon on war in a paragraph. Email the assignment with your HW for the day.


Mark Topping as John Wesley. Taken from the DVD dramatizing significant moments in his life: Cf. www.revjohnwesley.com; for more about the Methodist Church of Great Britain: Cf. www.methodist.org.uk.

Reading Check

Describing

What are some of the central ideas of Methodism?


HW or in-class work due the following day.
You may email to http://mail.shanahan.org/Login.aspx

In the textbook, review the six "Reading Check" questions in Ch. 10 Sec. 1; be prepared for a Quiz later (Thursday or Friday) in the week.

Tuesday HW

1. History Through Art, p. 302; History Through Art, p. 303; Comparing Past and Present, p. 305 (one or two paragraphs).

Honors Business Economics Chapter 1 Section 2, 21 September 2010

Prayer
Current Events:

Vitner Says a Firming Economy Won't Change Fed Language

Cf. http://www.youtube.com/watch?v=AjkbzyHeKoY

Sept. 20 (Bloomberg) -- Mark Vitner, a senior economist at Wells Fargo Securities LLC in Charlotte, North Carolina, talks about Federal Reserve monetary policy, the outlook for the economy and consumer sentiment. Vitner speaks with Margaret Brennan on Bloomberg Television's "InBusiness." (Source: Bloomberg)

Terms/phrases to understand (in-class assignment for today; email with your HW for today):

FOMC
Double-dip recession

FOMC meeting

About the FOMC

The term "monetary policy" refers to the actions undertaken by a central bank, such as the Federal Reserve, to influence the availability and cost of money and credit to help promote national economic goals. The Federal Reserve Act of 1913 gave the Federal Reserve responsibility for setting monetary policy.

The Federal Reserve controls the three tools of monetary policy--open market operations, the discount rate, and reserve requirements. The Board of Governors of the Federal Reserve System is responsible for the discount rate and reserve requirements, and the Federal Open Market Committee is responsible for open market operations. Using the three tools, the Federal Reserve influences the demand for, and supply of, balances that depository institutions hold at Federal Reserve Banks and in this way alters the federal funds rate. The federal funds rate is the interest rate at which depository institutions lend balances at the Federal Reserve to other depository institutions overnight.

Changes in the federal funds rate trigger a chain of events that affect other short-term interest rates, foreign exchange rates, long-term interest rates, the amount of money and credit, and, ultimately, a range of economic variables, including employment, output, and prices of goods and services.

Cf. http://www.federalreserve.gov/monetarypolicy/fomc.htm

What Does Double-Dip Recession Mean?

Double-dip recession

When gross domestic product (GDP) growth slides back to negative after a quarter or two of positive growth. A double-dip recession refers to a recession followed by a short-lived recovery, followed by another recession.

Investopedia explains Double-Dip Recession
The causes for a double-dip recession vary but often include a slowdown in the demand for goods and services because of layoffs and spending cutbacks from the previous downturn.

A double-dip (or even triple-dip) is a worst-case scenario. Fear that the economy will move back into a deeper and longer recession makes recovery even more difficult.

Chapter 1: What Is Economics?

I will create a new page on our Shanawiki (Cf. http://shanawiki.wikispaces.com/) site as well to create a Quiz/Test Study page.

Preview:

Chapter 1 Section 2 Basic Economic Concepts

Overview: Section 2 Basic Economic Concepts

The concepts of goods, services, consumers, markets, factor markets, product markets, productivity, economic growth, and economic interdependence are explained and are linked in the circular flow diagram. Productivity is necessary for economic growth, and growth takes place when specialization and the division of labor are present. In addition, human capital, the sum of our skills, abilities, health, and motivations are other important components of growth.

As I pointed out yesterday, the next five terms are HW for tonight.

a) value

b) paradox of value

c) utility

d) wealth

e) market

The remainder are HW for the rest of the week.

factor market

product market

economic growth

productivity

human capital

division of labor

specialization

economic interdependence

Academic Vocabulary

transferable

accumulation

mechanism


The Circular Flow of Economic Activity, p. 15

Circular flow model, 4:21

A brief video using the circular flow model to illustrate the basic nature of product markets and factor markets.



Factor Markets

Factor Markets, 3:01

The video is about factor markets. In economics factor markets are also termed as resource markets referring to the place where the factors of production are bought and sold. The factors of production include land, labor, capital, raw materials and management (otherwise referred to as entrepreneurship).

In-class assignment: in your own words, describe factor markets (email along with your HW for the day).






Product Markets

Reading Check

Explaining

What roles do factor markets and product markets play in the economy?

Productivity and Economic Growth, p. 16

Writers Talk Ross Gittins: Higher productivity, 3:45

Economics journalist Ross Gittins talks about his book Gittinomics and ways to create higher productivity.

In-class assignment: how does Gittins explain ways to increase productivity (email along with your HW for the day)?



Productivity

Investing in Human Capital

Division of Labor and Specialization, p. 17

In The Wealth of Nations, Adam Smith argued that economic growth occurred as a result of specialization and division of labor. If each household produced every commodity it consumed, the total level of consumption and production in a society will be small. If each individual specializes in the productive activity at which they are "best," total output will be higher. Specialization provides such gains because it:

* allows individuals to specialize in those activities in which they are more talented,
* individuals become more proficient at a task that they perform repeatedly, and
* less time is lost switching from task to task.

Increased specialization by workers requires a growth in trade. Adam Smith argued that growing specialization and trade was the ultimate cause of economic growth.

Adam Smith and David Ricardo argued that similar benefits accrue from international specialization and trade. If each country specializes in the types of production at which they are best suited, the total amount of goods and services produced in the world economy will increase. Let's examine these arguments a bit more carefully.

There are two measures that are commonly used to determine whether an individual or a country is "best" at a particular activity: absolute advantage and comparative advantage. These two concepts are often confused. An individual (or country) possesses an absolute advantage in the production of a good if the individual (or country) can produce more than can other individuals (or countries). An individual (or country) possesses a comparative advantage in the production of a good if the individual (or country) can produce the good at the lowest opportunity cost.

Economic Interdependence

Let's examine an example illustrating the difference between these two concepts. Suppose that the U.S. and Japan only produced two goods: CD players and wheat. The diagram below represents production possibilities curves for these two countries. (These numbers are obviously hypothetical).


Notice that the U.S. has an absolute advantage in the production of each commodity. To determine who has a comparative advantage, though, it is necessary to compute the opportunity cost for each good. It is assumed that the production possibilities curve (PPC) is linear to simplify this discussion (we will talk about the PPC in greater detail in a subsequent lesson).

The opportunity cost of one unit of CD players in the U.S. is 2 units of wheat. In Japan, the opportunity cost of one unit of CD players is 4/3 of a unit of wheat. Thus, Japan possesses a comparative advantage in CD player production.

The U.S. however, has a comparative advantage in wheat production since the opportunity cost of a unit of wheat is 1/2 of a unit of CD players in the U.S., but is 3/4 of a unit of CD players in Japan.

If each country specializes in producing the good in which it possesses a comparative advantage, it can acquire the other good through trade at a cost that is less than the opportunity cost of production in the domestic economy. For example, suppose that the U.S. and Japan agree to trade one unit of CD players for 1.6 units of wheat. The U.S. gains from this trade because it can acquire a unit of CD players for 1.6 units of wheat, which is less than the opportunity cost of producing CD players domestically. Japan gains from this trade since it's able to trade one CD player for 1.6 units of wheat while it only cost Japan 4/3 of a unit of wheat to produce a unit of CD players.

If each country produces only those goods in which it possesses a comparative advantage, each good is produced in the global economy at the lowest opportunity cost. This results in an increase in the level of total output.


Reading Check

Analyzing

What role does specialization play in the productivity of an economy?

Profiles in Economics, p. 18

Adam Smith (1723-1790)
French thinkers known as physiocrats focused on economic reforms. Like the philosophes, physiocrats based their thinking on natural laws. The physiocrats claimed that their rational economic system was based on the natural laws of economics.

Physiocrats rejected mercantilism, which required government regulation of the economy to achieve a favorable balance of trade. Instead, they urged a policy of laissez faire (les ay fehr), allowing business to operate with little or no government interference. Physiocrats also supported free trade and opposed tariffs.

Scottish economist Adam Smith greatly admired the physiocrats. In his influential work The Wealth of Nations, he argued that the free market should be allowed to regulate business activity. Smith tried to show how manufacturing, trade, wages, profits, and economic growth were all linked to the market forces of supply and demand. Wherever there was a demand for goods or services, he said, suppliers would seek to meet that demand in order to gain profits. Smith was a strong supporter of laissez faire. However, he felt that government had a duty to protect society, administer justice, and provide public works. Adam Smith’s ideas would help to shape productive economies in the 1800s and 1900s.

Division of Labor

Smith, a Scottish economist, argued that economies function most efficiently and fairly when individuals are allowed to pursue their own interests.

One person may decide to be a baker, another a merchant. One person may choose to sell his land, another to farm it. But all of these private decisions, made by rational, self-interested individuals, Smith argued, combine to produce a healthy, growing economy.

Invisible Hand

The great threat to economic growth, Smith argued, was government intervention—the government telling people what to do would only muck up the works. Government intervention distorted the natural and rational exercise of free, prudent choice. When left to their own natural operation, the private decisions made by thousands of rational economic players were tied into prosperous harmony by the “invisible hand” of the market.

Wealth of Nations

If you haven't read his famous book, it's absolutely worth checking out, whether or not you consider yourself a disciple of the free market. The Wealth of Nations is, without a doubt, one of the most important books of all time. And the ideas it contained played a powerful role in shaping the development of American economic thought. The book is relevant it matters today what he wrote.

Adam Smith's metaphor of the invisible hand remains one of the most important and influential ideas in economics, even today. As Americans have recently grappled with questions about how government should and should not intervene in the economy, many have turned to Smith for guidance.

What would Adam Smith think about the stimulus bill? About universal government-organized health insurance? About bailouts for companies judged "too big to fail"?

Cf. Adam Smith, http://www.shmoop.com/economic-systems/botw/resources?d=http://www.econlib.org/library/Enc/bios/Smith.html

Sometimes, a Song Says it Better: Billionaire, by Travis McCoy, 3:31

Travis wants to be a billionaire. Adam Smith would be proud.



HW

Email me at gmsmith@shanahan.org, or in a hard copy hand in.
1. Ch. 1 Sec. 1 Scarcity and the Science of Economics, review the material just in case there is a a Quiz (hint, hint) in the latter part (Thursday or Friday).

Tuesday HW, define the next five "Content Vocabulary," p. 12, words.

f) value

g) paradox of value

h) utility

i) wealth

j) market

Wednesday HW, define the next five "Content Vocabulary," p. 12, words.

k) factor market

l) product market

m) economic growth

n) productivity

o) human capital

Thursday HW, define the next five "Content and Academic Vocabulary," p. 12, words.

p) division of labor

q) specialization

r) economic interdependence

Academic Vocabulary

s) transferable

t) accumulation

u) mechanism