question

Monetarism

answer

An economic philosophy that assumes inflation occurs when there is too much money chasing too few goods. Suggests that the proper thing for government to do is to have a steady, predictably increase in the money supply at a rate about equal to the growth in the economy's productivity

question

Keynesianism

answer

the belief that government must manage the economy by spending more money when in a recession and cutting spending when there is inflation- john maynard keynes

question

Planning theory

answer

believes that the free market is too unreliable to ensure economic efficiency, therefore gov. should plan part of a country's economy 1. wage price control 2. gov. directs industrial investments

question

Supply-side

answer

In economics, the theory that investment incentives such as lowered federal spending and tax cuts will stimulate economic growth and increased employment.

question

Reaganomics

answer

The economic program instituted by President Ronald Reagan in 1981 which combined the theories of monetarism, supply-side tax cuts, and domestic budget cutting. The goal was to reduce the size of the federal government, to stimulate economic growth, and to increase United States military strength. The effect led to a dramatic increase of national debt, increased military spending, a drop in inflation but higher interest rates, personal income taxes cut, social security raised, unemployment decrease.

question

Fragmented Policy Making

answer

small narrowly defined problems, fits into broader policy concerns, easier to pass

question

CEA (Council of Economic Advisers)

answer

executive branch members who are sympathetic to the President's view of economics and are professional economists

question

CEA jobs (2)

answer

1. Forecast economic trends 2. Prepares annual economic report which the President sends to Congress

question

Office of Management and Budget (2)

answer

1. Prepares estimates of amounts to be spent by federal government agencies 2. Ensures that agencies legislative proposals are compatible with Pres. program

question

Secretary of Treasury (2)

answer

1. Provides estimates of government revenue of existing tax laws and the projected revenue from changes in tax laws 2. Represents the nation with bankers of other nations

question

The Federal Reserve Board (3)

answer

1. Members appnt. by Pres.; confirmed by Senate; serve non-renewable 14-year term, removable for cause 2. Somewhat independent of both Pres. and Congress 3. Regulates supply and price of money

question

Congress role in policy making (4)

answer

-Most important in economic policy making 1. approves all taxes and almost all expenditures 2. consent to wage and price control 3. can alter Federal policy by threatening to reduce its powers 4. internally fragmented, with numerous committees setting fiscal policy

question

effects of claims by interest groups (2)

answer

1. usually majoritarian 2. Sometimes interest group politics-protectionsim (protect a counties domestic industries from foreign competition by taxing imports)

question

Spending Money

answer

1. Majoritarian or interest group politics may result 2. Sources of conflict reflect in inconsistencies of public opinion 3. Politicians have incentives to keep spending down but support favorite programs 4. Inconsistency of those appeals is evident in budget

question

interest group politics

answer

A policy in which one small group benefits and another small group pays

question

Congressional Budget Act of 1974

answer

The law that altered the procedures by which Congress enacts the national budget. Budget committees were created in both houses, which then submitted to each house a resolution proposing a total budget ceiling and a ceiling for each of several spending areas. Once these resolutions were adopted, individual appropriations were decided. Congress then adopted a second resolution reconciling the budget ceiling with individual appropriations bills. One weakness was that the first resolution is frequently ignored.

question

Gramm-Rudman Balanced Budget Act

answer

A law passed in 1985 which proposed cutting the budget until there was no longer a deficit. The deficit was to be reduced by a specified amount each year between 1986 and 1991. If a spending plan could not be agreed on within those targets, federal programs (with some exemptions) would automatically be cut by a fixed percentage. The procedure was abandoned in 1990.

question

1993 Budget Bill

answer

1. Caps money set aside for specific purposes 2. Caps spending set on a yearly basis by decision of Congress

question

Difficulties in reducing spending (3)

answer

1. increase groups pressure for program funding 2. much of budget is expenditures representing past commitments that cannot be altered (social security benefits, national debt) 3. performance of economy unpredictable

question

Tax Policy

answer

Tax policy is a mixture of majoritarian politics (what is a 'fair' tax law?) and client politics (how much is in it for me?)

question

Majoritarian (what is a 'fair' tax law?) (2)

answer

1. tax burden is kept low 2. requires everyone to pay something

question

client politics (how much is in it for me?)

answer

1. requires the better-off to pay more

question

budget

answer

document that announces how much the government will collect in taxes and spend on revenues and how those expenditures will be allocated among various programs

question

budget deficit

answer

situation where the government spends more than it takes in

question

budget resolution

answer

a recommendation for budget ceilings to guide legislative committees in their spending decisions

question

budget surplus

answer

situation where the government takes in more money than it spends

question

economic planning

answer

The belief that government plans, such as wage and price controls or the direction of investment, can improve the economy

question

fiscal policy

answer

an attempt to use taxes and spending to affect the economy

question

fiscal year

answer

The period from Oct. 1 to Sept. 30 for which government appropriations are made and federal books are kept.

question

industrial policy

answer

an economic philosophy that would have the government planning or subsidizing investment in industries that need to recover or new and better industries that could replace them

question

loophole politics

answer

A form of client politics involving deductions, exemptions, and exclusions by which people shelter some of their income from taxation.

question

marginal rate

answer

the extra taxes paid on an additional dollar of income

question

monetary policy

answer

an attempt to manage the economy by altering the supply of money and interest rates

question

Bureau of Budget

answer

Created in 1921; its primary task is to prepare the Annual Budget for presentation every January. It also controls the administration of the budget; improving it and encouraging government efficiency.

question

peace dividend

answer

Following the collapse of the Soviet Union, the expected sums of money freed up by cuts in post-Cold War defense spending that could be transferred to domestic spending.

question

price and wage controls

answer

In times of high inflation, it suggests that the governmnent regulate the maximum prices that can be charged and wages that can be paid, at least in the larger industries.

question

sequester

answer

provision of the Gramm-Rudman Balanced Budget act-Automatic, across-the-board cuts in certain federal programs that are triggered by law when Congress and the president cannot agree on a spending plan.

question

Sixteenth Amendment

answer

The constitutional amendment adopted in 1913 that explicitly permitted Congress to levy an income tax.

question

tariff

answer

tax on imported goods

question

tax expenditures

answer

Revenue losses that result from special exemptions, exclusions , or deductions on the federal tax law.

question

Tax Reform Act of 1986

answer

Gave low rates with small deductions. Individuals gained while businesses suffered.

question

uncontrollable spending

answer

the portion of the federal budget that is spent on programs, such as Social Security, that the president and Congress are unwilling to cut-About 3/4 of governmental expenditures fall into this category

question

goals of social policies (3)

answer

1. protect most people from the risks and insecurities throughout the life cycle 2. promote equality of opportunity 3. alleviate poverty

question

Four perspectives form which social policies will be examined

answer

1. the development of the welfare state 2. analysis of who benefits form social policies 3. poverty alleviation policies 4. the struggle to balance liberty, equality, and democracy

question

contributory program

answer

Social program financed by taxation or other mandatory contributions by future/presents recipients.

question

noncontributory program

answer

a social program that assists people based on demonstrated need rather than contribution they have made

Economic and Social Policy

Unlock all answers in this set

Haven't found what you were looking for?

Search for samples, answers to your questions and flashcards