Economic View

Kanes idea of an economy is more to the left as he wanted more government intervention while Hanyek wanted an economy where the economy would take care of it self. When globalization came about these two had began to advance their ideas and take it to a new level. How these new factors like travelling and new ways to trade. Hanyes thought that his new impact would damage their society as their society was fragile. WWII destroyed 20 mil lives, it laid a whole continent to waste. Hanyek was a participant in the first world war, he strived to make the world a better place, a capitalistic economy.In 1917, there was a russian revolution people were divided and people wanted to smash capitalism. Car; Marks idea was to make the working class rise up and this would make equalization which is the basic idea of communism. They tried to make Trade, commerce and private property criminal acts and they promised to end the economic exploitation of man. Kanes was the rival of Hanyek ideology wise. He spent the first world war advising the government. Kane thought that the money that the british were demanding from Germany was disgusting, so he resigned. The idea of socialism is the mixed between both governments. Fairness and equality in a society so that the poor don't have to stay poor and they can become rich. Libertarians believe in people's personal choice. They dont care its your choice, basically extreme freedom. In Moscow 1922, the state controlled the economy everyone was equal. Small business where allowed but anything big was controlled by the soviet government. In Vienna 1923, germany and austria were forced to pay more money for peace. This caused inflation. Hanyek even received 208 pay raises. Pay inflation would lead to people not having enough money and items would become a lot of money due to hyperinflation. Hitler later comes along and promises to make things better and hopefully put an end to Germany paying money. America cities would be spending a lot of money they would buy new cars and most importantly stocks. Stocks would bubble and later the bubble would burst and a lot of people would lose a lot of money and this would later hurt economies in a very big way. This would later lead to the great depression as prices would become a lot and people would become poor and a lot of people who were spending a lot of money would spiral downward. This along with banks and stores. People waiting to withdraw all of their money and this would hurt banks would later close down because of the mass disappearance of money. Pure ideologies would fail no matter what way they were taken. A government can’t be a pure capitalistic if so it would hurt the country and later fail. In washington 1933, Rosevelt would later help america get out of the great depression. It became a soliclism type of government because the government would intervene and help the people. New industries would be made and refined. Governments would help and intervene and make the aviation industry safer for people and would make it more stable. Kaynes made a book or a report on how to fix the great depression. He wanted governments to have a fund of money to prepare for the future. MORE GOVERNMENT INTERVENTION. In world war II, pearl harbor was bombed. The depression was finally gone as the people had to prepare for the war and make new items like uniforms and weapons. Hanyek thought that kanes was taking society in a big step backwards. He wrote the road to serfdom and how kanes economy can make people come back to old ages were people would be “enslaved” and the government would be the new “monarch” in that economy. In New Hampshire 1944, delegates come from all over the world to talk about post world events the later made the world bank and other Global institutions. The goal was to make the economy stable and prevent another depression and they did a great job as they are not as many depressions as there would be more if this didn’t happen. V-E Day in 1945, the war was finally over and the troops came back.

World War I

15 million died (soldiers and civilians)

66K Canadians died

Economic costs of the war were very high

Europe was destroyed and they were heavily in debt to the US

Treaty of Versailles was signed at the end of WWI

Its goal was to ensure peace (punish Germany)

Reality: Hard economic conditions on Germany

They forced Germany for war damages to Britain, France, Russia and other countries

Keynes argued that if they did this it would cripple them and would later start another way. Germany also gave up its colonies

The ware cost 2.5min/day 37000000

Income taxes were temporarily introduced to help pay the costs of the war.

Interest on the war debt was 164min/year +76min/year

Shortage of Workers in Canada, negatively impacted manufacturing

Russia was ruled by Czar Nicholas II in 1914

In Russia their feudal system was still there.

Russia Empire

1/6th of the Earth’s surface

150 million people

100 different nationalities

Czar was the absolute monarch

Russian serfs were severely repressed

Russia was not very industrialized

Absolutism- When the monarch is chosen by God and their future monarchs were chosen because God made it that way

WWI- Russian soldiers were poorly equipped and poorly lead

Nearly 4 mln soldiers were killed/ wounded/ prisoners 1st year

Food and fuel shortages in Russia

Workers rebelled- better wages and working conditions

1917- Nicholas II abdicated and was executed

Up until 1922 there was a civil war