AP Government: Economic and Social Welfare Policymaking
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social welfare policies
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- policies that provide benefits to individuals - based on either entitlement or means testing - cash or in-kind
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unemployment rate
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- the proportion of the labor force actively seeking work but unable to find jobs - measured by the Bureau of Labor Statistics
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underemployment rate
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- people who aren't working and are actively seeking a job, those who would like to work but have given up looking, and those who are working part-time because they cannot find a full-time position - measured by the Bureau of Labor Statistics
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inflation
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- a rise in price of goods and services
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consumer price index
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- the key measure of inflation - the change in the cost of buying a fixed basket of goods and services
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laissez-faire
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- the principle that government should not meddle in the economy
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monetary policy
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- government manipulation of the supply of money in private hands - one of two important tools by which the government can attempt to steer the economy (along with fiscal policy)
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monetarism
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- an economic theory holding that the supply of money is the key to a nation's economic health - too much cash and credit in circulation produces inflation
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Federal Reserve System
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- the main instrument for making monetary policy in the United States - regulates the lending practices of banks and thus the money supply - created by Congress in 1913
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fiscal policy
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- use of the federal budget to influence the economy - one of two important tools by which the government can attempt to steer the economy (along with monetary policy) - determined by Congress and the president
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Keynesian economic theory
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- emphasizing that government spending and deficits can help the economy deal with its ups and downs - advocates using the power of government to stimulate the economy when its lagging
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supply-side economics
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- an economic theory holding that the key task for fiscal policy is to stimulate the supply of goods, as by cutting tax rates - applied during the Reagan administration
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Reaganomics
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- the economic policies of the former US president Ronald Reagan, associated especially with the reduction of taxes and the promotion of unrestricted free-market activity
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entitlement programs
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- government programs providing benefits to qualified individuals regardless of need
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means-tested programs
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- government programs providing benefits only to individuals who qualify based on specific needs
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income distribution
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- the way the national income is divided into "shares" ranging from the poor to the rich
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relative deprivation
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- a perception by an individual that he or she is not doing well economically in comparison to others
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income
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- the amount of money collected between any two points in time
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wealth
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- the value of assets owned
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poverty line
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- the income threshold below which people are considered poor - based on what a family must spend for an "austere" standard of living - traditionally set at three times the cost of a subsistence diet
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feminization of poverty
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- the increasing concentration of poverty among women - usually unmarried women and their children
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Earned Income Tax Credit
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- a refundable federal income tax credit for low-to-moderate incoming working individuals and families, even if they did not earn enough money to be required to file a tax return - aka EITC
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transfer payments
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- benefits given by the government directly to individuals - ie, cash transfers (Social Security payments), or in-kind transfers (food stamps)
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Social Security Act of 1935
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- created both the Social Security program and a national assistance program for poor families
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Personal Responsibility and Work Opportunity Reconciliation Act
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- the welfare reform law of 1996 - implemented the Temporary Assistance of Needy Families program
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Temporary Assistance for Needy Families
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- program for public assistance to needy families - requires people on welfare to find work within two years and sets a lifetime maximum of five years - replaced Social Security Act of 1935
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Social Security Trust Fund
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- the "account" into which Social Security employee and employer contributions are "deposited" and used to pay out eligible recipients
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New Deal
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- a series of reforms enacted by the Franklin Roosevelt administration between 1933 and 1942 with the goal of ending the Great Depression
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Great Society
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- chiefly to enact domestic programs to improve education, provide medical care for the aged, and eliminate poverty - under the leadership of President Lyndon B. Johnson
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Gramm-Rudman-Hollings Act
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- a law which required spending cuts if the deficit got too high
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sequester
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- a general cut in federal spending
