Миловидов В.А. Английский разговорный язык. Практическое пособие по развитию устной речи
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10. Why did the customer want to buy the whistle, and not the machines?
Fascism
The word «fascism» comes from the Latin fasces, and means a bundle of rods with an axe in it.
In economics, fascism is viewed upon as a third way between free trade capitalism and
communism. Private property and the profit motive are quite welcome within fascist economy if
they do not conflict with the interests of the state.
The classical expample of fascism in economics was Italy in the days of Mussolini, where it
grew out of syndicalism and nationalism. The syndicalists supposed that economy ought to be
governed by groups representing various industries. The nationalists put forward the idea of
national struggle. Italy was a proletarian nation suffering from the unfavourable results of World
War I, they said, and to win a greater share of the world's wealth, all of Italy's classes must
unite. Mussolini was a syndicalist who turned nationalist during World War I.
In Mussolini's Corporative State all economic decisions were made by councils composed of
workers and employers who represented different trades, and who were supposed to resolve all
the conflicts between classes and industries. These counsels aimed at preventing the class
struggle from undermining the national struggle. All the economic life was supervised by the
government.
After Mussolini became dictator in 1925, he began a program of massive deficit spending,
public works, and eventually, militarism.
Preparing for the coming war, Mussolini extensively used protectionist measures to turn the
economy toward economic self-sufficiency. Government bureaus had to purchase Italian
products only, and increased tariffs on imports were introduced in 1931, along with high import
quotas, and embargo on industrial goods.
Eventually profit motive was being reduced after Mussolini eliminated the ability of business to
make independent decisions. The government now controlled all prices and wages, it regulated
agriculture by dictating crops and breaking up farms. Banking system was also controlled to an
extraordinary extend.
Later, in the 30s and early 40s Hitler's nazism shared many features with Italian fascism,
including the syndicalist front. Nazism, too, featured complete government control of industry,
agriculture, finance, and investment.
As World War II came closer, the signs of fascism's failure in Italy were visible: private
consumption had fallen to the level below that of 1929s, and the industrial production between
1929 and 1939 was much lower than the rates for other Western European countries. Labour
productivity was low and production costs were uncompetitive. The fault lay in the shift of
economic decision-making from entrepreneurs to government bureaucrats, and in the allocation
of resources by government decisions rather than by free markets. Mussolini designed his
system to satisfy the needs of the state, not of consumers. In the end it turned out that neither
was satisfied.
:
ability – ,
allocation – ,
axe –
bundle –
bureau –
compose –
council –
dictator –
eliminate – ,
extensively – ,
extraordinary – ,
fascism –
fault – ,
feature – ,
militarism –
nationalism –
nazism –
proletarian –
purchase –
reduce –
resolve – ,
rod –
satisfy –
shift –
suffer –
supervise –
syndicalism –
undermine –
be welcome –
World War I –
turn nationalist –
Corporative State –
aim at preventing –
class struggle –
massive deficit spending – ,
public works –
protectionist measures –
self-sufficiency –
syndicalist front –
turn out –
Exercise 6
Answer the questions:
1. Where does the word «fascism» come from?
2. How do private property and the profit motive correlate with the interests of the state under
fascism?
3. What did economic fascism in Italy grow from?
4. What was for the Italian nationalists the sure way to win a greater share of the world's
wealth?
5. How were economic decisions made in Mussolini's Corporative State?
6. What program did Mussolini begin in 1925?
7. What measures were taken to make Italy self-sufficient economically?
8. What do Mussolini's fascism and Hitler's nazism, as economic systems, have in common?
9. What signs of fascism's failure in Italy were visible before World War II?
10. Whose needs did Mussolini want to satisfy by building the system of Corporative State?
2.
(Economics)
1
– What is Economics?
– Economics is extremely useful as a form of employment for economists.
2
– What is an Economist?
– An economist is an expert who will know tomorrow why the things he predicted yesterday
didn't happen today.
3
– How do Economists work?
– Economists don't answer the questions others make because they know what the answer is.
They answer because they are asked.
4
– Why is Economics so helpful?
– Economists have forecasted 9 out of the last 5 recessions.
5
A study of economics usually reveals that the best time to buy anything is last year.
Economics and Life
1
A grade school teacher was asking students what their parents did for a living. «Tim, you be
first. What does your mother do all day?»
Tim stood up and proudly said, «She's a doctor.» «That's wonderful. How about you, Amy?»
Amy shyly stood up and said, «My father is a mailman.» «Thank you, Amy» said the teacher.
«What does your parent do, Billy?» Billy proudly stood up and announced, «My daddy plays
piano in a brothel.» The teacher was aghast and went to Billy's house and rang the bell. Billy's
father answered the door. The teacher explained what his son had said and demanded an
explanation. Billy's dad said, «I'm actually an economist. How can I explain a thing like that to a
seven-year-old?»
2
The mathematician's child and the economist's child were in the third grade together, and the
teacher asked, «If one man with one shovel can dig a ditch in ten days, how long would it take
ten men with ten shovels to dig the same ditch?» Both children raised their hands.
The teacher said to the mathematician's child, «Johnny, how long?» and little Johnny said,
«One day, teacher.»
The teacher looked at the economist's child and said, «John Maynard, is that right?»
Little John Maynard said, «Teacher, it all depends.»
:
aghast – ,
dig –
ditch –
explanation –
extremely –
forecast –
mailman –
announce –
brothel – .
predict –
proudly –
recession – ( – )
reveal – , ,
shovel –
shyly – ,
do for a living –
how long would it take –
it depends – ()
Exercise 1
Answer the questions:
1. Who is economics most useful for?
2. What will economist know tomorrow?
3. Why do economists answer questions when asked?
4. When is the best time to buy things, according to economics?
5. Why couldn't Billy's father explain to his son what he did for his living?
3
Two government economists were returning home from a field meeting. As with all government
travellers, they were assigned the cheapest seats on the plane so they each were occupying
the centre seat on opposite sides of the aisle.
They continued their discussion of the knotty problem that had been the subject of their meeting
through takeoff and meal service until finally one of the passengers in an aisle seat offered to
trade places so they could talk and he could sleep. After switching seats, one economist
remarked to the other that it was the first time an economic discussion ever kept anyone awake.
Monetarism
One of the principal monetarist propositions is the association between money growth and
inflation: inflation is produced if sustained money growth exceeds the growth of output. If a
government wants to end inflation or produce deflation, money growth must be lower than the
growth of output. In the years since World War II, almost all countries experienced inflation.
Some countries, such as Chile, Israel, Brazil, Argentina, Italy, Japan, Turkey, and the United
States have increased or reduced inflation at different times by speeding up or reducing the rate
of money growth. In some of these countries the changes in money growth and inflation have
ranged over hundreds or thousands of percentage points.
The Federal Reserve System (the US Central Bank) increased money growth in the late sixties
to finance government spending for the Vietnam War and for the War on Poverty. As the result
inflation increased. By the late seventies money growth was nearly 7 percent a year on average
and inflation reached an 8 percent average. On the whole prices doubled in less than a decade.
Money growth slowed and remained low after the middle eighties. In the five years ending in
1991, inflation and money growth were back at the levels of 1965 to 1969. Table
1 shows these and other periods.
U.S. Money Growth and Inflation
(compound annual rates in percent)
Money Growth Inflation
1960–64 2.8 1.6
1965–69 4.9 3.7
1970–74 6.0 6.0
1975–79 6.9 7.9
1980–84 6.6 7.3
1985–89 7.2 3.5
1987–91 4.4 3.8
There is a general association between money growth and inflation, but this relation is not
mechanical. Although average money growth remained high in the years from 1985 to 1989,
inflation fell. It shows that money growth in excess of output growth is a necessary but not the
only condition for inflation.
A second monetarist idea is the relation between inflation and the interest rates. When inflation
is going to be high, interest rates on the open market are high. In addition the foreign-exchange
value of a currency falls relative to more stable currencies. Interest rates in 1989 reached 8,000
percent a year in Yugoslavia. The Yugoslav dinar depreciated against the dollar from 0.03 to 1,
to 10.6 to 1. At the same time Brazilian currency (under various names) fell from 0.01 to 177.
The relation betweeen inflation and money growth is accounted for by the fact that high growth
of money causes a flight from money that makes the currency worthless. Governments can
control these effects of inflation for a short time, but they cannot do it permanently.
Currency depreciation or appreciation can be affected by numerous factors, such as growth of
defense spending, government purchases, tax rates, productivity growth at home and abroad,
and foreign decisions. Among them inflation is the most important: sustained inflation induces
depreciation, and disinflation induces appreciation, as monetarists say.
A third monetarist proposition concerns the relation between inflation and output. When inflation
increases, output often rises for a time above its trend rate. Deflation has the opposite effect,
and recessions follow.
These monetarist assumptions about inflation, interest rates, exchange rates, and output, as
well as about their interrelation are now widely accepted by policymakers. Central bankers
follow guidelines for money growth, as they are well aware nowadays of the risks and the costs
of inflation, their principal task being the maintenance of price stability.
:
accept –
affect –
annual – ,
appreciation –
average –
aware – ,
compound – ,
concern – , ;
currency –
decade –
defense – ,
deflation –
depreciate – ,
depreciation – , ,
dinar –
disinflation –
exceed –
excess – ,
exchange –
flight – , ,
guideline –
induce – , ,
interrelation –
maintenance –
mechanical –
monetarism –
permanently –
policymaker – , ,
poverty –
proposition – ,
recession –
relative – ; :
slow – ;
stable –
sustain –
value – ,
worthless –
money growth –
speed up –
range over – :
percentage point –
on average –
compound annual rates –
in excess of –
interest rates –
foreign-exchange value –
flight from money –
tax rates –
foreign decisions –
trend rate –
well aware – ,
:
Chile –
Israel –
Brazil –
Argentina – ( the Argentine)
Italy –
Japan –
Turkey –
Vietnam –
Yugoslavia –
Exercise 2
Answer the questions:
1. Under what general conditions is inflation produced?
2. What does a government have to do if it wants to put an end to inflation?
3. Why did the Fed increase money growth in the US in the late sixties?
4. What is the relation between inflation and the interest rates?
5. Why do people «fly from money» in the periods of high growth of money?
6. What factors play key roles in the currency depreciation process?
7. What is the relation between inflation and output?
8. In what way do deflation and output interrelate?
9. What is the trend output rate?
10. What effect does monetarism have on real economic policies?
Monetarism in Action
A little old lady sold pretzels on a street corner for 25 cents each. Every day a young man would
leave his office building at lunch time. As he passed her pretzel stand, he would leave her a
quarter, but would never take a pretzel. This went on for more than five years. The two of them
never spoke. One day as the young man passed the old lady's pretzel stand and left his quarter
as usual, the pretzel woman spoke to him: «Sir, I appreciate your business. You are a good
customer, but I have to let you know that due to inflation the price of pretzels has increased to
35 cents.»
* * *
– Why do Economists provide estimates of inflation to the nearest tenth of a percent?
– To prove they have a sense of humour.
* * *
Inflation allows you to live in a more expensive neigbourhood without moving.
:
appreciate –
estimate – (),
pretzel –
quarter – 25
pretzel stand –
the nearest tenth of a percent –
sense of humour –
Exercise 3
Answer the questions:
1. Why didn't the young man take a pretzel?
2. What was the inflation rate in the five years the story about pretzels is speaking of?