Fulcher Chapters 2, 3 & 6 Web Questions

Below please find a few question written by Katrina Casino and Levi McClellan on the assigned chapters from James Fulcher’s Capitalism: A Very Short Introduction. Please answer one with a response of at least one paragraph in length.

CHAPTER 2: WHERE DID CAPITALISM COME FROM? (Katrina)

1) In this chapter, Fulcher attempts to flesh out the reasons why capitalism developed in Europe. He also seeks to define what makes capitalism. One of the factors he lists is the formation of guilds and labor unions. To what extent is capitalism defined by conflict between owners and workers? Is capitalism dependent on this dynamic? Or is it dependent on other factors like the production process?

2) Although the two may seem contradictory, Fulcher makes the argument that capitalism evolved from the ruins of feudalism. Explain why this is so. What part did the developing notion of class conflict play in this transition? How was the multi-state structure conducive to the development of capitalism, and what is its relation to feudalism?

CHAPTER 3: HOW DID WE GET HERE? (Levi)

1) Anarchic capitalism was characterized as having no government intervention in markets, intense competition between companies, lack of worker benefits (and lack of ability to bargain for better conditions), and an all around unregulated system where prices were determined solely by the market. This condition contrasts to the more regulated managerial capitalism and present day capitalism.  Many present day politicians call for less regulation in markets. If they got their way, do you think we would see a return to anarchic capitalism or would we still retain some of the managerial capitalism aspects?  Would there be any benefit to a more anarchic capitalism society? Why?

2) Managed capitalism, as Fulcher explains, is the beginning of regulated markets, state-intervention, state-welfare and the start of large unions. With corporations getting larger, and less competition compared to anarchic capitalism, why do you think that this new type of managerial capitalism gave way to more regulation, unions, and state-sponsored welfare? Who benefits from managed capitalism and what might be some problems that company owners face with managed capitalism?

CHAPTER 6: CRISIS? WHAT CRISIS? (Katrina)

According to Fulcher, the tendency to overproduce is built into the capitalist system. Why doesn’t this cause the capitalist system to collapse? Furthermore, why is capitalism dependent on the results of overproduction?

 

 


4 Comments on “Fulcher Chapters 2, 3 & 6 Web Questions”

  1. YU,ZEXUN says:

    I think our economic system would be collapsed by changing today’s capitalism back to anarchic capitalism. Humans are greedy. Thus, those major companies would try to monopolize their own territories if government stopped regulating the market. If that has happened, the distances between upper class and lower class would increase. For example, if a company monopolized the water supply, what do you think about the first thing that the company would do? It would increase the price as much as possible, because people couldn’t live without water. So, people have no other choices, just paying a lot of money for their daily uses. I don’t think there would be any benefit. Today’s capitalism makes a lot of competitions, but that is a cool way to control the prices, and make it suits for living standard. People want to buy the best things for lowest prices, so those companies would control their prices to attract the buyers. Thus, the prices won’t be out of track under today’s capitalism. I don’t think there would be any benefit if our world backed to anarchic capitalism. Trust, monopoly, and cartel are the only words that we could find under anarchic capitalism. The prices would keep increasing until the balance is broken.

  2. Aleksandr Ashurov says:

    In reply to chapter 6:

    Karl Marx believed that the crises of the 19th century helped maintain capitalism. When producers overproduced their products, prices dropped and the demand was dramatically lowered. Because of this people lost their jobs and companies went bankrupt. These crises cycled every 10 years or so. Each time this occurred, most of the inefficient production companies and businesses, closed down and were bankrupt. Because of this, supply was lowered to a level closer to demand. Demand was also stimulated by cheaper prices. People were able to get jobs again and begin expanding production.
    Source: Fulcher, Capitalism

  3. Levi McClellan says:

    Chapter 3. Q1. Anarchic capitalism would essentially be the destruction of our society. As Fulcher said, anarchic capitalism led to people to physically hurt other and other businesses. It led to total chaos, as the name would suggest. The competition would get so fierce that instead of it benefitting all, like Adam Smith suggested it would, more people would lose. Such a deregulated market would cause employers to take advantage of workers in a way that we could not even fathom. The wage rate would be pushed so low, that people would literally starve despite having fulltime employment. Anarchic capitalism would lead to a worker revolution as Marx had predicted capitalism would. Politicians push for a more anarchic capitalist society because in theory, it should work. If price is decided solely by supply and demand, then in theory the price of goods would always be affordable and wages would always high enough for the market price. However, theory is not always the same as reality and as we can see from our somewhat regulated market, companies like to take advantage. Price fixing goes on, workers rights are stripped and these companies do their best to milk every last cent out of the average worker and consumer. If a completely unregulated market were to exist, employers would do their best to keep wages as low as possible and prices as high as possible. Without some regulation unions wouldn’t exist, minimum wage would be gone, insider trading would occur, and the majority of people would lose money while very few would gain a lot. Interesting how even with some regulation this still occurs.

  4. Katrina says:

    Chapter 3, Question 2:

    Managed capitalism emerged largely as a reaction to the dehumanizing tendencies of its predecessor, anarchic capitalism. Part of this process was class organization, in which both employers and workers joined associations that allowed for collective bargaining and negotiation. Corporations also became larger through concentration, which cut down on competition. Governments began to work toward the welfare state and regulated important industries and services. There were also underlying motivations and international contexts behind managed capitalism. Empires were no longer defined solely by territory but also by economic influence, and rivalry motivated progress. The most obvious beneficiaries of managed capitalism were the workers, who gained rights and protections that anarchic capitalism had prevented from being possible. The welfare state provided a universal safety net for workers, and collective bargaining ensured that they could leverage their power. However, corporations and the state also benefitted from managed capitalism. Welfare ensured a steady supply of healthy and willing workers to increase not only profits but prosperity. Labor interests forming in the government provided the efficacy of the democratic system. Despite this, it is true that managed capitalism was not necessarily completely beneficial for company owners, who now had to concede to the demands of workers, and who had to re-imagine new ways to maximize profits. However, as a whole, managed capitalism provided a segue into a more sustainable, universally beneficial form of capitalism.


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