Thursday, October 07, 2010

Honors Business Economics Chapter 2 Section 1, 8 October 2010

Current Events:

Vizerra (Monday)

TuneUp_Media (Tuesday)

bitbop (Wednesday) (Thursday)

E-Fuel Corp. (Friday)

Are there any other options?


As a venture capitalist, you can only fund one entrepreneur. Which one would you fund? Vizerra (Monday), TuneUp Media (Tuesday), Bitbop (Wednesday), Bump Network, Inc. (Thursday), or, today's, E-Fuel Corp.?

Debates in Economics

Should the Minimum Wage Be Increased?

Chapter 2 Economic Systems and Decision Making

Section 1 Economic Systems

Chapter Overviews

Section 1: Economic Systems

Economic systems help societies provide for the wants and needs of their people. Three major economic systems have evolved over the years: traditional, command, and market economies. In the traditional economy, the WHAT, HOW, and FOR WHOM questions are answered by tradition, customs, and even habits handed down from generation to generation. In a command economy, a central authority answers the three basic questions. In a market economy, decision making is decentralized with consumers and entrepreneurs playing a central role. Most economies in the world today feature some mix of traditional, command, and market economies.

Pursuit! On the Trail of Economic Growth

Four hundred years of New England history tell us much about how economic growth occurs. pursuit! puts you hot on the trail of this phenomenon by helping you discover the key ingredients of growth. Travel our Timeline with one of our special guides on a fun hunt for the many things that enable us to have a rising living standard. There's a lot to learn from New England's bumpy but amazing growth path. So, pack your bag, pick a trail, and get in pursuit!

How to Play

Pick a "Trail." Each trail explores a different time period with 8 questions based on New England history. Pick a "Guide." Your guide keeps you energized and on track! Answer the questions by searching the Timeline. Click the left/right arrows and century tabs to navigate. To find some answers, you'll have to click on the events for more information. Bonus: ONLY if you get at least 7 of the 8 questions right, your guide performs a "special trick" to celebrate!

1. We will divide the class into three teams for each of the three trails. There are three historical periods surveying four hundred years of historic economic growth. Each group may pick one historical period.

2. There are six guides. You may "meet" as many guides as you wish before making your selection.


Systems Explained for (Farmers) Dummies Using Two Cows, 3:57

In-class assignment: pick your favorite "cow" and explain its characteristics, provide examples, and describe its advantages and disadvantages.

The fundamental principles of the different types of economic, political, and social systems explained via a simple example using two cows. You heard right, COWS. If you know what a cow is and are aware of the fact that they produce more than just steaks for your dinner, or products such as milk, you are good to go and should have no problem understanding the concepts: think a traditional, a command, and or market economies.















Why It Matters, p. 32

The BIG Idea

Guide to Reading, p. 33

Section Preview

Content Vocabulary

economic system

traditional economy

command economy

market economy



mixed economy

The Spectrum of Mixed Economies




Academic Vocabulary




Reading Strategy

Comparing and Contrasting

Companies in the News

McDonald's and Hindu Culture

Traditional Economies, p. 34





Reading Check


What are the advantages and disadvantages of a traditional economy?

The Global Economy & You, p. 35

Command Economies


Examples, p. 36


Disadvantages, p. 37

Reading Check


What are the major problems with a command economy?

Market Economies


Examples, p. 38


Disadvantages, p. 39

Reading Check


What are the main characteristics of a market economy?

Mixed Economies


Examples, p. 40


Disadvantages, p. 41

Reading Check


How can you explain the range of mixed economies in the world?

Section 1 Review

Case Study

The Home Depot

Women's Conference: Home Depot, 7:16


Section 2 Evaluating Economics Performance

Guide to Reading, p. 43

Section Preview

Content Vocabulary

Academic Vocabulary

Reading Strategy

Companies in the News

Economic and Social Goals, p. 44

Economic Freedom

Economic Efficiency

Economic Equity

Economic Security, p. 45

Full Employment

Price Stability

Did You Know?

Economic Growth

Future Goals

Reading Check


What major themes can you identify in the list of seven economic goals?

Resolving Trade-Offs Among Goals, p. 46

Reading Check


Why do trade-offs among goals exist?

Section 3 American Free Enterprise


Hayek's 'The Road to Serfdom' in Five Minutes, 5:01

In the 1940s, Look Magazine made a comic strip of Hayek's classic book 'The Road to Serfdom'. Hayek went on to win the Nobel Prize in Economics in 1974.
Hayek's central thesis is that all forms of collectivism lead logically and inevitably to tyranny, and he used the Soviet Union and Nazi Germany as examples of countries which had gone down "the road to serfdom" and reached tyranny. Hayek argued that within a centrally planned economic system, the distribution and allocation of all resources and goods would devolve onto a small group, which would be incapable of processing all the information pertinent to the appropriate distribution of the resources and goods at the central planners' disposal. Disagreement about the practical implementation of any economic plan combined with the inadequacy of the central planners' resource management would invariably necessitate coercion in order for anything to be achieved. Hayek further argued that the failure of central planning would be perceived by the public as an absence of sufficient power by the state to implement an otherwise good idea. Such a perception would lead the public to vote more power to the state, and would assist the rise to power of a "strong man" perceived to be capable of "getting the job done". After these developments Hayek argued that a country would be ineluctably driven into outright totalitarianism. For Hayek "the road to serfdom" inadvertently set upon by central planning, with its dismantling of the free market system, ends in the destruction of all individual economic and personal freedom.

Hayek argued that countries such as the Soviet Union and Nazi Germany had already gone down the "road to serfdom", and that various democratic nations are being led down the same road. In The Road to Serfdom he wrote: "The principle that the end justifies the means is in individualist ethics regarded as the denial of all morals. In collectivist ethics it becomes necessarily the supreme rule."


Activity: Interdisciplinary Connection

Read 19th-century short stories by Russian authors such as Anton Chekhov or Nikolay Gogal. As you read, list details that describe effects of the Soviet Union's command economy--for example, details about jobs, economic and social status, property rights, individual freedoms, and the government. Write a report summarizing the economic effects that you fin din the story.



BULGARIA - From a Command to a Market Economy, 4:43


1.1 Quiz





HW email to or hand in hard copy.

1. What are the major problems with a command economy?

2. What are some products that have fallen out of favor in the United States? Why aren't these goods as widely produced as they used to be?

Honors World History II: 7 October 2010

Current Events:

Dearborn, MI, news

Do American Christians (and Catholics) have the natural right to practice their religion?

First Amendment - Religion and Expression


Nonetheless, the Courts and judges are turning to international forms of law to guide their decisions.

For example, an appellate Court nominee is University of California-Berkley law Professor Goodwin Liu.

Liu published an article in the Daito University Law School Journal that stated: “The use of foreign authority in American constitutional law is a judicial practice that has been very controversial in recent years. The resistance to this practice is difficult for me to grasp since the United States can hardly claim to have a monopoly on wise solutions to common legal problems faced by constitutional democracies around the world.”

And, we might consider recent Supreme Court appointee Elena Kagan.

As Dean of Harvard Law School, Kagan made major changes to the Harvard Law's curriculum. She instituted three international law courses and, in so doing, she got rid of a requirement to take constitutional law. Constitutional law is not required even for graduation.

Kagan did appear to some to favor sharia, Islamic law while at Harvard.

SCOTUS Nominee Kagan & Sharia Law?


Critics allege Elena Kagan is sympathetic to Sharia law

Exclusive: To Stop Sharia Law in America, Stop Elena Kagan’s Nomination

Kagan’s Sharia Compliance

Elena Kagan More Favorable to Islam and Sharia Law Than U.S. Military

HW Avatar (per our usual procedure HW is also posted at the bottom of the daily blog post as well as being posted on GradeConnect):

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The "Pop" Quiz will be returned and grades posted ASAP (once the Make-Ups are done); Quiz 1 can be reviewed. You can also compare your performance with your colleagues at the Preliminary Quiz Assessment Page.


If you did not put your name on the Quiz it will not be returned.

For review:

The Enlightenment and the American Revolution (1700–1800)


Chapter 10 Section 4 Colonial Empires and the American Revolution

In the sixteenth century, Portugal came to control Brazil, while Spain established an empire in the Western Hemisphere that included parts of North America and most of Latin America. Portugal and Spain held onto their Latin American colonies for over 300 years. During that time, they profited richly by exporting Latin American gold, silver, and other natural resources and farm products. Spanish and Portuguese officials and Christian missionaries played important roles in Latin American societies. In North America, British control over its colonies began to unravel over issues of taxation. Multiple crises led the Americans to declare their independence in 1776 and to fight Britain until its defeat in 1783. The Articles of Confederation that formed the United States were soon replaced with a Constitution, which created a stronger central government. The Bill of Rights added important freedoms derived from the natural rights expressed by the philosophes.

Main Ideas

The colonies of Latin America and British North America were developing in ways that differed from their European mother countries.

The American colonies revolted against Great Britain and formed a new nation.


*Describe characteristics of Britain and the 13 English colonies in the mid-1700s.
*Outline the events that led to the American Revolution.
*Summarize the events and significance of the American Revolution.
*Analyze how the new Constitution reflected the ideas of the Enlightenment.

Terms, People, and Places



federal system

Additional Terms, People, and Places

George III

Stamp Act

George Washington

Thomas Jefferson

popular sovereignty

Yorktown, Virginia

Treaty of Paris

James Madison

Benjamin Franklin

federal republic



Colonial Empires in Latin America

Economic Foundations

State and Church

Reading Check


How did the Portuguese and the Spanish profit from their colonies in Latin America?

British and British North America

By 1750, a string of 13 prosperous colonies stretched along the eastern coast of North America. They were part of Britain’s growing empire. Colonial cities such as Boston, New York, and Philadelphia were busy commercial centers that linked North America to the West Indies, Africa, and Europe. Colonial shipyards produced many vessels for this trade.

Britain applied mercantilist policies to its colonies in an attempt to strengthen its own economy by exporting more than it imported. To this end, in the 1600s, Parliament had passed the Navigation Acts to regulate colonial trade and manufacturing. For the most part, however, these acts were not rigorously enforced. Therefore, activities like smuggling were common and not considered crimes by the colonists.

By the mid-1700s, the colonies were home to diverse religious and ethnic groups. Social distinctions were more blurred than in Europe, although wealthy landowners and merchants dominated government and society. In politics, as in much else, there was a good deal of free discussion. Colonists felt entitled to the rights of English citizens, and their colonial assemblies exercised much control over local affairs. Many also had an increasing sense of their own destiny separate from Britain.

Reading Check


What countries made up Great Britain in the 1700s? To whom does the British refer?

The American Revolution

The Seven Years’ War and the French and Indian War in North America had drained the British treasury. King George III and his advisors thought that the colonists should help pay for these wars. To increase taxes paid by colonists, Parliament passed the Sugar Act in 1764, which imposed import taxes, and the Stamp Act in 1765, which imposed taxes on items such as newspapers and pamphlets. “No taxation without representation,” the colonists protested. They believed that because they had no representatives in Parliament, they should not be taxed. Parliament repealed the Stamp Act in 1766, but then passed a Declaratory Act that said it had complete authority over the colonists.

A series of violent clashes intensified the colonists’ anger. In March 1770, British soldiers in Boston opened fire on a crowd that was pelting them with stones and snowballs. Colonists called the death of five protesters the Boston Massacre. Then in December 1773, a handful of colonists hurled a cargo of recently arrived British tea into the harbor to protest a tax on tea. The incident became known as the Boston Tea Party. When Parliament passed harsh laws to punish Massachusetts for the destruction of the tea, other colonies rallied to oppose the British response.

As tensions increased, fighting spread. Finally, representatives from each colony gathered in Philadelphia and met in a Continental Congress to decide what action to take. Among the participants were the radical yet fair-minded Massachusetts lawyer John Adams, who had defended the British soldiers involved in the Boston Massacre in their trial; Virginia planter and soldier George Washington; and political and social leaders from all 13 colonies.

Paine’s Common Sense

Early in 1776, English colonists in North America eagerly read the newly published Common Sense, by Thomas Paine. This pamphlet called on them to declare their independence from Britain and echoed the themes of the Enlightenment.


—Thomas Paine, Common Sense

The War Begins

In April 1775, the ongoing tension between the colonists and the British exploded into war in Lexington and Concord, Massachusetts. This war is known as the Revolutionary War, or the American Revolution. The Congress met soon after and set up a Continental Army, with George Washington in command. Although many battles ended in British victories, the colonists were determined to fight at any cost. In 1776, the Second Continental Congress took a momentous step, voting to declare independence from Britain. Thomas Jefferson of Virginia was the principal author of the Declaration of Independence, a document that reflects John Locke’s ideas of the government’s obligation to protect the people’s natural rights to “life, liberty, and property.”

Declaration of Independence

stands as one of the most important documents in all of history. It still serves as inspiration for people around the world. Where did some of the ideas of the Declaration originate?

Primary Source


—Declaration of Independence, July 4, 1776

The Declaration included another of Locke’s ideas: people had the right “to alter or to abolish” unjust governments—a right to revolt. The principle of popular sovereignty, which states that all government power comes from the people, is also an important point in the Declaration. Jefferson carefully detailed the colonists’ grievances against Britain. Because the king had trampled colonists’ natural rights, he argued, the colonists had the right to rebel and set up a new government that would protect them. Aware of the risks involved, on July 4, 1776, American leaders adopted the Declaration, pledging “our lives, our fortunes, and our sacred honor” to creating and protecting the new United States of America.

At first, the American cause looked bleak. The British had a large number of trained soldiers, a huge fleet, and greater resources. About one third of the American colonists were Loyalists, or those who supported Britain. Many others refused to fight for either side. The Americans lacked military resources, had little money to pay soldiers, and did not have a strategic plan.

Still, colonists had some advantages. One was the geography of the diverse continent. Since colonists were fighting on their own soil, they were familiar with its thick woods and inadequate roads. Other advantages were their strong leader, George Washington, and their fierce determination to fight for their ideals of liberty.

To counteract these advantages, the British worked to create alliances within the colonies. A number of Native American groups sided with the British, while others saw potential advantages in supporting the colonists’ cause. Additionally, the British offered freedom to any enslaved people who were willing to fight the colonists.

Foreign Support and British Defeat

The first turning point in the war came in 1777, when the Americans triumphed over the British at the Battle of Saratoga. This victory persuaded France to join the Americans against its old rival, Britain. The alliance brought the Americans desperately needed supplies, trained soldiers, and French warships. Spurred by the French example, the Netherlands and Spain added their support.

Hard times continued, however. In the brutal winter of 1777–1778, Continental troops at Valley Forge suffered from cold, hunger, and disease. Throughout this crisis and others, Washington was patient, courageous, and determined. He held the ragged army together.

In 1781, the French fleet blockaded the Chesapeake Bay, which enabled Washington to force the surrender of a British army at Yorktown, Virginia. With that defeat, the British war effort crumbled. Two years later, American, British, and French diplomats signed the Treaty of Paris, ending the war. In that treaty, Britain recognized the independence of the United States of America. The Americans’ victory can be attributed to their resilient dedication to attaining independence.

Reading Check


Why did foreign countries support the American cause?

The Birth of a New Nation

"A Republic Madam, if you can keep it."

Benjamin Franklin


George Washington

When George Washington (1732–1799) was chosen to lead the American army, the British thought he would be a failure. Washington indeed faced many challenges, including an army that did not have weapons, uniforms, or bedding. He struggled to incorporate order and discipline and to instill pride and loyalty in his soldiers. Washington persevered to American victory. His success as a leader continued when he became the nation’s first President. How did Washington hold the army together through difficult times?

James Madison

James Madison (1751–1836) arrived at the Constitutional Convention in Philadelphia in May 1787 with his thick notebooks on history and government. Madison chose a seat in front of the president’s chair and kept detailed notes of the debates. Madison was greatly respected and quickly became the Convention’s floor leader. His notebooks remained unpublished for more than 50 years, but they are now our main source of information about the birth of the Constitution. What did the Framers of the Constitution have in common?

Benjamin Franklin

Benjamin Franklin (1706–1790) was a philosopher, scientist, publisher, legislator, and diplomat. Sent by Congress to France in 1776 to seek financial and military support for the war, he soon became popular in France because of his intellect and wit. Those who admired America’s goal of attaining freedom also admired Franklin. When Franklin returned to America after nine years, he served as a delegate to the Constitutional Convention as the eldest of the delegates. Why was Franklin admired in France?

The Constitution

The Articles of Confederation was the nation’s first constitution. It proved to be too weak to rule the new United States effectively. To address this problem, the nation’s leaders gathered once more in Philadelphia. Among them were George Washington, James Madison, and Benjamin Franklin. During the hot summer of 1787, they met in secret to redraft the articles of the new constitution. The result was a document that established a government run by the people, for the people.

The Bill of Rights

The Framers of the Constitution had studied history and absorbed the ideas of Locke, Montesquieu, and Rousseau. They saw government in terms of a social contract into which “We the People of the United States” entered. They provided not only for an elective legislature but also for an elected president rather than a hereditary monarch. For the first President, voters would choose George Washington.

The Constitution created a federal republic, with power divided between the federal, or national, government and the states. A central feature of the new federal government was the separation of powers among the legislative, executive, and judicial branches, an idea borrowed directly from Montesquieu. Within that structure, each branch of government was provided with checks and balances on the other branches.

The Bill of Rights, the first ten amendments to the Constitution, was important to the passage of the Constitution. It recognized the idea that people had basic rights that the government must protect, such as freedom of religion, speech, and the press. The Bill of Rights, like the Constitution, put the philosophes’ Enlightenment ideas into practice. In 1789, the Constitution became the supreme law of the land, which means it became the nation’s fundamental law. This remarkable document has endured for more than 200 years.

The Constitution of the United States created the most freest government of its day, and most likely for all time. From the start, the new republic was a symbol of freedom to European countries and reformers in Latin America. Its constitution would be copied or adapted by many lands throughout the world. The Enlightenment ideals that had inspired American colonists brought changes in Europe too. In 1789, a revolution in France toppled the monarchy in the name of liberty and equality. Before long, other Europeans would take up the cry for freedom as well.

Reading Check


What was the main difference between the Articles of Confederation and the Constitution?

Eyewitness to History

The Mission

Pearson Success Net has an interesting note on a "Witness History" feature.

Cf. References and exercises on Sec. 4.

As an exercise, we can play the part of an American spy as a Patriot working to free America from England's rule.

We can view an online exhibit about the Revolutionary War.

Also, we can view newspaper accounts of the American Revolution with a time line and quiz.

We might also explore an interactive portrait of George Washington.

I had asked you to consider other references and exercises on Sec. 4.

Of the three I had you to take a look at, which was the class favorite?

1. We can view an online exhibit about the Revolutionary War.

2. Also, we can view newspaper accounts of the American Revolution with a time line and quiz.

3. We might also explore an interactive portrait of George Washington.

And now we can consider the situation of the 13 colonies.

For access at home:


Web Code: nap-1731

Map Skills

1. Locate
a) Philadelphia
b) Massachusetts
c) Boston

2) Which colony had two pieces of land?

3) What do almost all the colonial cities have in common based on the map?

Colonists Express Discontent (audio)

Primary Source


What we did on our summer vacation, Summer 2009




Do research on the U.S.S. Constitution. What can you find out about this remarkable ship, nicknamed "Old Ironsides?"

Map Skills

Be sure to detail where the cities are located, e.g., state whether they are in the North, South, Mid-Atlantic, etc.

1. Locate
a) Philadelphia
b) Massachusetts
c) Boston

2) Which colony had two pieces of land?




Abuses inherited as a result of a controlling aristocracy may be seen clearly in this work.

Whigs and Hunters: The Origin of the Black Act by E.P. Thompson

Events That Changed the World

For: Interactive map, audio, and more
Web Code: nap-1733

For review:

The Enlightenment and the American Revolution (1700–1800)


HW: email (or hard copy) me at

1. Thursday HW

p. 324, Reviewing Key Facts, #11-13

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