SOCL 2501- Chapter 7

SOCL 2501- Chapter 7 - March 4, 2008 Chapter 7: Economic...

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March 4, 2008 Chapter 7: Economic Problems (Wealth and Poverty) Economy and Social Class in the U.S. In America: all men are created “equal” BUT, the US have always had social classes Social class- groups of people who occupy the same rung on the economic ladder Economy Includes money and jobs, but also the entire social institution that produces and distributes goods and services If functions affect the welfare of every individual, groups, and community in society 2 types of economies Capitalist Private ownership Profit Fluctuates- busts and booms Proponents of: socialism is immoral= denied people freedom of choice Socialist Government owned property Profit is illegal Production and price of goods controlled by the government Proponents of : capitalism is immoral= put profit ahead of the welfare of the people Triumph of Capitalism At this stage in world history, capitalism has triumphed To try and control the boom and bust cycle of capitalism- the G8 holds an annual conference Attempt to regulate the global market
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March 4, 2008 Difficult to predict the cycles G8 uses the International Monetary Fund World bank that lend money to nations in economic trouble Socialist countries had a primary advantage= greater equality Jobs for everyone (jobs paid little) Medical care for everyone No wealth, but no hunger either So why did capitalism win over socialism? Capitalism is more efficient at producing wealth; this leads to the development of social inequality Social inequality The unequal distribution of wealth, income, power, and other opportunities But most under capitalism have a high standard of living Capitalism offer individual freedoms and opportunities for economic success, but social inequality leads to social problems Economic Problems Facing the U.S. Stagnant Income Decline in purchasing power and real income Real income Income adjusted for inflation Real income of today’s workers is about the same as it was in 1970 Because the raises received have been eaten up by inflation What has cushioned this change? More family members working Average household today brings in only 17% more than it did in 1980
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March 4, 2008 This additional income is before the costs that jobs require: child care, second car, additional clothing, lunches, etc. Taxes The ever-promised tax cuts On average most of us work for the government for almost 4 months before we have a cent for our own needs Savings Americans save less than the citizens of all other industrialized nations This drop in savings has significant consequences Workers savings are put to work in society Reduced savings means less to invest in competition in the global market Debt US is the largest debtor in the world To finance the national debt we pay about $180 billion a year in interest
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SOCL 2501- Chapter 7 - March 4, 2008 Chapter 7: Economic...

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