Ryker Olsen

Professor Howell
Economic History of the U.S.
29 May 2017
Free or Equal Questions:
While watching Free or Equal, answer the questions as follows:
Fill-in-the-blank questions - Use the precise language from the video.
Short answer questions - Summarize the concepts in your own words, as explained in the
video.
Question 10 - Analyze the proposal & provide your unique perspective.
You do not need to use the same format as shown below (with boxes). Use a format which works
best for you.

1. If the government gives everybody the same freedom to work and reap the rewards, some
will do better than others. The result will be ____________________, but not
____________________.
Answer #1: Equality of opportunity.
Answer #2: Equality of outcome.

2. Immigrants who arrived in the late-1800s/early-1900s found that America was truly a
land of opportunity. Describe the factors these immigrants encountered which helped
them thrive.
Factors: Few rules/regulations, no licenses, or permit to restrict them from success.
There was opportunity, and a free market. They were poor, but had opportunity to
work.

3. What are the factors which led to the rapidly rising standard of life in Hong Kong? (Be
specific.)
Hong Kong: The complete absence of tariffs and restriction on trade.

4. Explain voluntary association & why it is essential in a free market.

Voluntary Association: Is what we do together of our own free will. According to the
video, it is anything going on between consenting adults. It is essential to the free
market because the people are the ones doing the trade, the government isnt forcing
them, etc. It creates an incentive to work and succeed.

5. Explain how the lead pencil & the smartphone are examples of invisible hands.
Invisible Hands: He explains that there is not a single person in the world that can
make a pencil. The pencil needs a tree, a saw to cut it down, steel to make the saw, and
iron ore to make the steel. Smartphones get more complex, with different components
being made in different countries around the world. It is simply, many people working
together toward a common goal.

6. In 1980, Milton Friedman visited Hong Kong & met Mr. Cheung who made & sold metal
containers. Decades later, Johan Norberg visited Mr. Cheung & found that he still makes
metal containers however, he now produces more things for the tourist trade. This is an
example of what economic concept? Explain its significance.
Economic Concept & Significance: Creative destruction. It is the concept that
describes people being flexible and adapting to no economic opportunities. He gives the
example of cell phones. With the increase in cell phones comes the decrease or downfall
of more obsolete technologies.

7. Johan Norberg describes how his home country of Sweden taxes heavily & then
redistributes wealth. Describe the benefits & drawbacks that this approach has on the
Swedish population.
Benefits: Increases public spending, more wealth distributions, less
drawbacks/consequences to failing in business.
Drawbacks: Reduces the rewards for working hard and taking risks, young Swedes are
moving to other countries where the rewards for working hard and entrepreneurship
are greater, and they are taxed less.

8. Explain how Free markets regularly turn luxuries into consumer goods.
Consumer Goods: The rich can afford to buy the earliest versions of things (cell phones,
laptops, etc.) which creates a market for these new things. This causes more production
and supply, and makes more people want/buy them. The demand and supply for these
goods then increases as prices decrease, making what used to be a luxuries, consumer
goods.

9. As Milton Friedman said, The society that puts equality before freedom will
_______________________. The society that puts freedom before equality will end up
with a __________________________________.
Answer #1: End up with neither.
Answer #2: Great measure of both.

10. Professor Friedman uses the analogy of a race to explain the concepts of Equality of
Opportunity and the Equality of Outcome:
In this class, we apply the Equality of Opportunity concept. All students begin on the same day,
receive the same course information & have the same amount of time to complete the
coursework. While there is no guarantee that students will earn a respectable grade, all students
are given the opportunity to earn a respectable grade.

Classroom:

Hypothetically, if we applied the Equality of Outcome concept in this class, all students
would be guaranteed to receive the class average grade.
The grade would be determined by combining all points earned (by the class as a whole)
& dividing them equally among each student. All students would earn the same grade
regardless of their performance.
Unless the class average were unusually high or unusually low, the most likely result
would be all students would earn a grade in the C range (C+, C or C-). Grades in the
C range are generally considered to be average grades.

1. Would you approve of using the Equality of Outcome method in calculating your final
grade? Why or why not?

2. What are the pros & cons in using this method?

3. Address the above two (2) questions in a minimum of 2 paragraphs.

Equality of Outcome in the Classroom: Absolutely not. I will succeed because I will put
work into what I wish to succeed in. This might be a good idea for someone who would
be happy with a C, but I am not. I would have to put my faith in my classmates to
succeed, and I know that you cant always expect them to. So no, I would like to take
my independently achieved grade.

Pros & Cons: The pros might be that t might make the class average on grades look
better I suppose (by showing that nobody failed the class), but it would anger a lot of
people. The only people that would benefit are those who are lazy, or do not wish to
succeed rather than just pass the class and get on with their lives. This would leave the
over achievers (people that would have received a higher grade) wondering why they
tried so hard.

Workplace:

If the Equality of Outcome concept were applied at your workplace, all employees would
be paid the same wage, regardless of their job duties, education, performance or skill.
Consider the example of Gravity Payments, a Seattle-based credit card processing
company. In April 2015, CEO Dan Price set a $70k minimum salary for all 120
employees. He also announced that he was taking a pay cut from $1 million to $70k.

1. Would you approve of using the Equality of Outcome method in calculating your salary?
Why or why not?
 2. What are the pros & cons in using this method?

3. Address the above two (2) questions in a minimum of 2 paragraphs.

Equality of Outcome in the Workplace: No, like the grades example, this would
discourage hard work and dedication to your work. In my opinion, it was stupid of the
CEO to take the pay cut, it might discourage people from climbing the ranks to higher
pay, and discourage them from working hard because they know they will get that
check for 70k.

Pros & Cons: The pros would be that the workers would receive 70k regardless of their
official job title, importance in the company, or quality/quantity of work. The cons
would be a decrease in incentive to work and achieve, because again, why climb the
ranks to a potentially harder job when it pays the exact same as yours does now?

Reflective Writing:

Compose 2-3 paragraphs explaining how completing this assignment helped you achieve at least
two (2) of the SLCC Learning Outcomes:
Learning Outcome #1 (Paragraph #1): (Think Critically & Creatively)
During this assignment, I was able to think critically about how a free market would
affect people and their quality of lives, as well as the economy itself. I discovered that a free
market gives rise to entrepreneurial spirit, incentives to work, opportunities, and a greater
quality of life. I was able to fully visualize what the drawbacks to an equality of outcome
model will be.
Learning Outcome #2 (Paragraph #2): (Develop knowledge & skills to be civically engaged)
Throughout the completion of this project, I was able to acquire knowledge that I
will be able to use in the future to be civically engaged. I was able to achieve a full
understanding of how a free market economy works, and the benefits it brings with it. I
was able to realize how lucky I am to be able to participate in a market that is much more
free and rewarding than the market in say, North Korea.