The industrialized countries of the 19th century had a wide gap between the rich and poor. Business owners didn’t want the government to meddle. However, reformers wanted government involvement to improve working conditions for the poor. Workers demanded rights and protection – they created labor unions to make themselves more powerful.

  • The Philosophers of Industrialization

    Laissez-faire is an economic policy where owners of industry set their own regulations around working conditions. This policy favors free, unregulated economies. The name comes from French, where it means “let do” – “let people do as they please.”

    • Laissez-faire Economics
      • Laissez-faire economics came from the French economic philosophers from the Enlightenment era. These philosophers criticized nations who were wealthy from taxation on goods. They argued that government involvement would interfere with production of wealth. These philosophers believed that free trade would lead the economy to prosperity.
      • Adam Smith, and professor in Scotland defended free market economies in 1776 with The Wealth of the Nations, a book declaring that economic liberty guarantees progress. Therefore, government should not interfere.
      • Smith argued that there are 3 natural laws of economics:
        • The law of self-interest – People work for their own good
        • The law of competition – Competition forces people to make a better product
        • The law of supply and demand – Enough goods at the lowest possible price to meet demand
    • The Economists of Capitalism
      • Smith’s ideas were supported by more British economists: Thomas Malthus and David Ricardo. The also believed in the natural laws governing the economic life. Their ideas made up the foundation of laissez-faire capitalism. Capitalism is the economic system where the factors of production are privately owned and money is invested to make profit. These ideas helped start the Industrial Revolution.
      • Thomas Malthus wrote An Essay on the Principle of Population in 1798. This essay argued that population grows faster than the food supply. Unless there is war and disaster to kill people, many will be miserable. Malthus’ predictions seemed to be true in the 1840s.
      • David Ricardo continued on Malthus’s theory in Principles of Political Economy and Taxation in 1817. Ricardo also believed that the underclass would always be poor. He believed that wages decline as population increases. Few workers + scarce resources = expensive.
      • These laissez-faire thinkers opposed government efforts to help poor workers as they felt minimum wage laws and better working conditions would upset the system, lower profits, and undermine wealth in society.
  • The Rise of Socialism

    The opposite of the laissez-faire system was the socialist system. Socialism is the system where wealthy people and the government take action to improve people’s lives.

    • Utilitarianism
      • The English philosopher Jeremy Bentham made changes to Adam Smith’s ideas. He created the philosophy of utilitarianism. In the 1700s, he wrote influential works preaching that people should judge ideas, institutions, and actions based on the usefulness. Government should promote the best for the most people. Useful government policies are the ones promoting this goal. An individual should pursue what he wants without state interference.
    • Utopian Ideas
      • Other reformers were more active. A British factory owner, Robert Owen, improved working conditions for his employees after he realized how miserable and poverty stricken the working class was. He built houses near his cotton mill and rented at low rates, prohibited children under 10 from working, and provided free schooling.
      • In 1824, Owens traveled to the United States and found New Harmony, Indiana. He tried to make this place a utopia. It lasted 3 years but inspired other such communities.
    • Socialism
      • French reformers such as Charles Fourier, Saint-Simon, and more tried to offset the bad side of industrialization with socialism. Socialism gave the factors of production to the public for operation, operating for the welfare of all.
      • These reformers had a more optimistic view of human nature and a belief in progress and justice. The socialists believed that the government should plan the economy and hold control over factories, mines, and other industries. This would end poverty and promote equality, as these industries would be public. This way, workers would also own part of the industry, not just their employers. Some socialists such as Louis Blanc wanted change with the right to vote.
  • Marxism: Radical Socialism

    The German journalist Karl Marx created a radical socialist movement called Marxism. Marx and Friedrich Engels (Engel’s father owns a textile mill in Manchester) published their ideas in The Communist Manifesto, a 23 page pamphlet.

    • The Communist Manifesto
      • In “The Communist Manifesto”, Marx and Engels argued that human society was composed of warring classes. The middle class, also known as “haves” are the bourgeoisie. The lower class, or the “have-nots” are workers called the proletariat. The wealthy controlled the production of goods while the poor labored in bad conditions.
      • Marx and Engels predicted that because the Industrial had just widened the wealth gap, the workers would overthrow their employers because they have nothing to lose.
    • The Future According to Marx
      • According to Marx, the capitalist system would destroy itself:
        • Factories would put artisans out of business.
        • The proletariats (workers) would rise against the wealthy owners.
        • Workers would share in profits and would control the government.
        • After a period of peace, the government would go away as classless society developed.
      • This last phase was called communism -a complete socialism where all means of production are owned by the public. Private property no longer exists as all goods are shared.
      • In 1848, The Communist Manifesto produced a few short term results. Widespread revolts occurred all over Europe, but governments quickly crushed the rebels. It was only after the end of the century that the pamphlet had explosive results. In the 1900s, Marxism inspired Russia’s Lenin, China’s Mao Zedong, and Cuba’s Fidel Castro into adapting Marxist beliefs into their own situations.
      • In the Communist Manifesto, Marx and Engels stated that economic forces were the dominating factor in society. However, history shows that religion, nationalism, and other loyalties are just a strong. Finally, many wealth gaps did not widen in the way predicted because of government interference and reforms.
  • Labor Unions and Reform Laws

    Factory workers faced long, hard hours at work and were constantly in fear of being laid off. However, in the 1800s, workers created voluntary labor associations called unions to press for reform. The working people became involved in politics.

    • Unionization
      • The workers in a union spoke with one voice. They would bargain and negotiate between the workers and her employers. Slowly, the began to bargain for better conditions and higher pay. If the employers refused, the union members could strike.
      • Skilled workers started the unions because they had the skills to have extra bargaining power. The skilled workers were harder to replace so these unions helped the lower middle class more than the lowest workers.
      • The unionization movement was slow and painful as both the British and United States government denied people the right to form unions. These governments felt that unions were a threat to social order. The Combination Acts of 1799 and 1800 outlawed these unions and strikes. However, many factory workers joined anyways. Parliament finally repealed the Combination Acts in 1824. They began to tolerate union.
      • British trade unions won the right to strike and peaceful picketing. They got around 1 million people involved.
      • In the United States, skilled workers had been in unions since the 1800s. In 1886, several unions combined to form the American Federation of Labor. Successful strikes gave these members higher wages and shorter hours.
    • Reform Laws
      • The reformers and unions forced the political leader to try and fix abuses caused by the rapid industrialization. In both Britain and the United States, the new laws fixed many cases of abuse. In the 1820s, Parliament passed the Factory Act of 1833 which made hiring children under the age of 9 illegal. Children 9 to 12 could only work for 8 hours and people 13 to 17 could not work more than 12 hours. In 1842, the Mines Act stopped women and children from working underground.
      • In 1847, Parliament helped women by making the workday limited to 10 hours for women and children.
      • The United States also passed laws to protect children. In 1924, the National Child Labor Committee ended child labor. This union forced national and state politicians to ban child labor and set maximum working hours.
      • The US Supreme Court objected to the federal child labor law as it interfered with the states’ rights. However, individual states were allowed to limit the working hours of women and men.
  • The Reform Movement Spreads

    The reform movements rose to combat the negative effects of industrialization. These reforms improved the workplace and gave the right to vote to working-class men. The impulse to reform with the ideals of the French Revolution helped end slavery and promote new rights.

    • The Abolition of Slavery
      • William Wilberforce was a highly religious member of Parliament who fought for the abolition of the slave trade. The Parliament passed a law ending slave trade in the British Indies. After retiring in 1825, Wilberforce continued hi fight. Britain abolished slavery in its entire empire in 1833.
      • The abolitionists had different motives. Some were morally against it, others thought of it as an economic threat. Also, a new class of industrialists preferred cheap labor over slave labor, and they soon gained power in Parliament.
      • The United States movement also decided to fulfill the promise of the Declaration of Independence by ending slavery in 1865. However, slavery still persisted in Puerto Rico, Cuba, and Brazil. Puerto Rico ended in 1873, Spain ended Cuban slavery in 1886, and Brazilian slaves only won freedom in 1886.
    • The Fight for Women’s Rights
      • The Industrial Revolution gave women higher wages than work at home – however, they still only made 1/3 the money men made.
      • Women led reform movements. During the 1800s, women formed unions in women dominated trades. In Britain, some women were safety inspectors in factories where other women worked. In the United States, college-educated women like Jane Addams ran settlement houses. These settlement houses were community centers to serve the poor residents from the slums.
      • In the US and in Britain, woman began to wonder why their rights should be denied based on gender. The movement began in 1848 in the United States. Women activists around the world formed the International Council for Women in 1888. Delegates and observers from 27 countries attended in 1899.
    • Reforms Spread to Many Areas of Life
      • Reformers tried to fix problems everywhere in society. Public education and prison’s where 2 of the highest on the reform list.
      • Horace Mann of Massachusetts wanted free public education for all children. He warned that all children should be prepared to become good citizens and that if this was not done, the republic would be destroyed. Many states started public school systems in 1850. Western Europe adopted this practice in the late 1800s.
      • In 1831, the French writer Alexis de Tocqueville condemned the brutal American prisons, comparing them to the liberty of American society. The prison reformers wanted to give prisoners a way to live a meaningful and useful life after being released.
      • In the 1800s, democracy grew in industrialized countries as foreign expansion increased. These industrialized democracies began facing new challenges.