1. Consider the following two positions:

a. To grant unrestricted economic freedom in society means to give private enterprise the freedom to flourish. The result will be increasing prosperity for the country as a whole. True, disparities in wealth will inevitably result, but that is as it should be. Those with initiative and ability should be rewarded. Government intervention to equalize income only obstructs the process and leads to the creation of widespread poverty.

b. To grant unrestricted economic freedom gives capitalists the freedom to exploit workers. The result is that millions sink into poverty as the rich grow richer. Since the rich will not voluntarily redistribute their wealth, government must do so, and must seek to bring about greater equality of wealth income through regulation, taxation and welfare programs.

Which of the above two positions seems to you most nearly correct, and why?

2. The text points out some of the ambiguities in the understanding of what socialism is (Section 8.1).  What does socialism mean to you? 

3. Much of the Marxist analysis hinges upon the labor theory of value, that is, the view that the value of something is determined by the amount of human time and energy that went into producing or sustaining it.  Does this seem to you a good criterion of value? Why or why not? 

4. What is the Marxist conception of historical materialism? (Section 8.7) Do you think it provides a plausible explanation of the past and future evolution (and demise) of capitalism?  Why or why not?