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Introduction
‡ Are you a capitalist?
‡ Challenging capitalism/globalization
± ³Warp-speed capitalism´
± Capitalism drags us into decadence
± ³Postmaterialist´ era
‡ Capitalism, globalization, and
challenge the view, September 11
± Shrinking globe
± Capitalism as a threat to way of life
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Purpose of the Book
The purpose of this book is to answer two questions:

1. What is the proper role of business

in American and global society?
2. How much, if any, government
regulation of business is necessary
to secure that role?

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2arkets and Governments
‡ United States: capitalist, democratic
‡ 2ixed economy
± Combination of capitalism and
government
‡ Law
± Serves as a primary method of social
control

Command Economy 2ixed Economy Free 2arket

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Capitalism
‡ Personal freedom
‡ Private property rights
‡ Ayn Rand¶s necessary categories of
government:
± Police
± Armed services
± Law courts

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Privatization in America and Abroad
‡ Contracting out where government, in
effect, turns over a portion of its
duties, such as garbage collection to
a private firm
‡ The sale or lease of public assets,
such as an airport, to a private party
‡ Can the market met decisions more
efficiently and effectively than
government while also maximizing
personal freedom?
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Privatization (continued)
‡ Examples of privatization:
± Toll roads and congestion pricing
± Golf courses
± Schools
‡ Pros of privatization:
± Substantially reduced costs
± Improved expertise
‡ Cons of privatization:
± 2oving too fast
± Selling assets too cheaply
± Lost jobs
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Collectivism
‡ Communism
± Core promise of economic justice for all
‡ Socialism
± Liberty
± Social welfare
± Fulfilling work
± Community
± Equality
± Rationality
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China - Economics
‡ Nation of 1.3 billion people aggressively
competing around the globe
‡ 400 million people lifted out of poverty
since the late 1970¶s
‡ Stunning levels of environmental pollution
‡ Stock market manipulation
‡ Piracy and unsafe goods
‡ Gap between China¶s rich and poor
estimated to be the world¶s largest
‡ Instituting significant corrective measures
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China - Politics
‡ Dictatorship governed by the
Communist Party
‡ Communist Party controls all media
‡ Hundreds of thousands of Chinese
confined to labor camps
‡ Progress: peaceful transition of power
in 2004
‡ Democracy not in China¶s near future

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Russia - Economics
‡ 2oscow has embraced consumer
capitalism
‡ Gross domestic product up 7 percent
annually
‡ Personal income up 8 percent
annually
‡ Stock market up 10 percent annually
‡ Russia remains a relatively poor
nation
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Russia - Politics
‡ State controlled companies in 2006
represented 38 percent of the nation¶s
stock market capitalization, up 22
percent from the previous year
‡ Russia is creating large corporations
owned or substantially controlled by
the state
‡ Bribery and corruption in both
government and the private sector are
common practice
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A 2ixed Economy
‡ Communism has failed
‡ Socialist principles are discredited
‡ A ³third way´

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Sweden
‡ Higher life expectancy compared to
the U.S. (80.5 years vs. 77.5 years)
‡ Higher tax rate compared to the U.S.
(50.1 % of GDP vs. 28.2% of GDP)
‡ Comparatively low corporate taxes
‡ Among the strongest economic
performers in the world
‡ Wise government spending key
ingredient
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American Capitalism in Europe?
‡ Globalization has put pressure on
some European states to trim their
welfare policies
‡ ³Cowboy capitalism´ vs. ³coordinated,
stakeholder capitalism´
‡ Quantity of wealth vs. quality of life

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America¶s Economic Future
‡ Capitalism?
‡ 2ove closer to the welfare state?
‡ Develop new model?
‡ Is our American system fair?

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›verall Quality of Life ± U.S. Rankings
‡ 12th in the world for overall quality of life
± Ranked well on economic measures, but not on
social measures
‡ 7th in GDP per capita
‡ 45th in life expectancy
‡ 43rd in infant mortality
‡ 1st in producing prisoners
‡ 7th in the percentage of young people who
finish college

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Good News and the Gap
‡ America is among the most generous
of global cultures
‡ In 2005, the wealthiest 1% of
Americans earned 21.2% of all
income (up 19% from 2004)
‡ The per capita income gap has nearly
doubled since 1980
‡ Upward mobility has not changed
significantly in the past three decades
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Community
‡ U.S. lives are increasingly solitary,
distant, alone, and unshared
‡ Even trivial exposure to money
changes our goals and behaviors
‡ Spending money on others rather
than yourself increases happiness
‡ Increasing evidence of declining
social connections
‡ ³Social capital´
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Too 2uch Capitalism? or Too Little?
‡ The EU Dream
± Emphasis on inclusivity, diversity,
sustainable development, and
interconnectedness
‡ The Bill Gates Dream
± ³Creative capitalism´
± Innovative thinkers should think about
the needy

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