The Economic and Political System of the United States in the Views of Adam Smith and Karl Marx

Topics: Karl Marx, Communism, Capitalism Pages: 9 (3131 words) Published: March 2, 2013
Table of Contents
Title PagePg.1
Table of ContentsPg.2
Adam Smith-BiographyPg.3
Karl Marx-BiographyPg.3
History and Description of GovernmentPg.4
Description of Economy Pg. 4
Use of Scarce Resources and its EffectsPg.6
Fundamentals of ProductionPg.8
Conclusion Pg.11
Works Cited Pg.12

The objective is to analyse the United States political and economic system in the point of view of two prominent economic thinkers, Adam Smith and Karl Marx. Both theories will be used to explore the economic decisions of the United States discussing scarcity, stakeholders and their influence on economic decisions, production and the use of productive resources. Adam Smith-Biography

Adam Smith, shown in Figure 1, was born in Kirkadly, Scotland in the year of 1723. He graduated from the University of Glasgow at the age of 17 and his teachings and publications became well known. While traveling throughout Europe, he met many leaders known as physiocrats, whose beliefs influenced Smith. Adam was against the economic system of his generation which was mercantilism. This system was successful when a country would export more than they import and they would limit imports resulting in money flowing into the country and very little going out which creating a more profitable country. He believed that people should be allowed to work without any restrictions and by doing so, it work will in favour of the economy. Smith’s economic theory was based on how individuals’ self interest benefits the economy rather than the artificial laws enforced by the government. He wrote about his theories in his two most famous works, The Theory of Moral Sentiments and The Wealth of Nations. Adam Smith died on July 17, 1790 (Bolotta, Hawkes, Mahoney, Piper). Karl Marx-Biography

Karl Heinrich Marx, shown in figure 2, was born on May 5, 1818 in Rhineland, Germany. He studied philosophy and history at the University of Berlin. He received his doctorate at the age of 23 and married two years later. He was in opposition of the economic structure during his time as it was based on core capitalist principles. The rich get rich off the labour of the poor. He was very much against the wealthy living, also known as the Bourgeoisie and supported the lower working class, known as the Proletariat. He started publishing his socialist views through editorials to the public and so he was soon in trouble with the government and was forced to leave the country. He and Friedrich Engels joined together and wrote their theory of communism in The Communist Manifesto. They believed that the revolution of communism would begin after the Proletariat rise to the Bourgeoisie (Bolotta, Hawkes, Mahoney, Piper). History and Description of Government

The United States became its own country on July 4th 1776, which is now known as its Independence Day, after the American Revolution when they separated from the control of Great Britain (Wikipedia History). The country established a sort of government called the Constitution of the United States in 1787 which allowed citizens equal rights and a implemented a guideline of their duties as well. The Bill of Rights followed shortly after in 1791, amending that each individual has certain rights that cannot be taken away from them even by the government (Wikipedia 2010). It is evident from the actions of the United States that the government was operated under many principles by Adam Smith. Allowing citizens their rights demonstrates that a central authority will not be in power which was the beliefs of Karl Marx. Democracy was exhibited by the United States as people were given the power to vote and elect representatives for the country (Wikipedia 2010). Description of Economy

With a population of 310 million and a GDP of $14.4 trillion, shown in figure 3, the United States...
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