Government Chapter 17 Vocab – Flashcards
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labor union
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An organization of workers intended to engage in collective bargaining.
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capitalism
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An economic system in which individuals and corporations, not the government, own the principal means of production and seek profits. Pure capitalism means the strict noninterference of the government in business affairs. Compare mixed economy.
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Securities and Exchange Commission
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The federal agency created during the New Deal that regulates stock fraud.
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consumer price index (CPI)
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The key measure of inflation that relates prices in one year to prices for a base year that are figured as 100.
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monetary policy
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Based on monetarism, the manipulation of the supply of money in private hands by which the government can control the economy. See also the Federal Reserve System, and compare fiscal policy.
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World Trade Organization (WTO)
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International organization that regulates international trade.
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collective bargaining
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Negotiations between representatives of labor unions and management to determine acceptable working conditions.
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National Labor Relations Act
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A 1935 law, also known as the Wagner Act, that guarantees workers the right of collective bargaining, sets down rules to protect unions and organizers, and created the National Labor Relations Board to regulate labor-management relations.
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minimum wage
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The legal minimum hourly wage for large employers.
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Keynesian economic theory
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The theory emphasizing that government spending and deficits can help the economy weather its normal ups and downs. Proponents of this theory advocate using the power of government to stimulate the economy when it is lagging. See also fiscal policy.
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laissez-faire
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The principle that government should not meddle in the economy. See also capitalism.
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inflation
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The rise in prices for consumer goods. It hurts some but actually benefits others. Groups such as those who live on fixed incomes are particularly hard hit, while people whose salary increases are tied to the consumer price index but whose loan rates are fixed may enjoy increased buying power.
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unemployment rate
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As measured by the Bureau of Labor Statistics (BLS), the proportion of the labor force actively seeking work but unable to find jobs.
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antitrust policy
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A policy designed to ensure competition and prevent monopoly, which is the control of a market by one company.
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fiscal policy
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The policy that describes the impact of the federal budget-taxes, spending, and borrowing-on the economy. Unlike monetary policy, which is mostly controlled by the Federal Reserve System, it is almost entirely determined by Congress and the president, who are the budget makers. See also Keynesian economic theory.
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supply-side economics
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An economic theory, advocated by President Reagan, holding that too much income goes to taxes and too little money is available for purchasing and that the solution is to cut taxes and return purchasing power to consumers. Has widened the gap between government revenues and expenditures.
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Taft-Hartley Act
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A 1947 law giving the president power to halt major strikes by seeking a court injunction and permitting states to forbid requirements in labor contracts forcing workers to join a union. See also right-to-work law.
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multinational corporations
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Businesses with vast holdings in many countries - such as Microsoft, Coca-Cola, and McDonald's - many of which have annual budgets exceeding that of many foreign governments.
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protectionism
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Economic policy of shielding an economy from imports.
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Federal Reserve System
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The main instrument for making monetary policy in the United States. It was created by Congress in 1913 to regulate the lending practices of banks and thus the money supply. The seven members of its Board of Governors are appointed to 14-year terms by the president with the consent of the Senate.
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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. Monetarists believe that too much cash and credit in circulation produces inflation. See also monetary policy.
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mixed economy
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An economic system in which the government is deeply involved in economic decisions through its role as regulator, consumer, subsidizer, taxer, employer, and borrower. The United States can be considered one. Compare capitalism.
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Food and Drug Administration (FDA)
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The federal agency formed in 1913 and assigned the task of approving all food products and drugs sold in the United States. All drugs, with the exception of tobacco, must have their authorization.
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Federal Trade Commission (FTC)
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The independent regulatory agency traditionally responsible for regulating false and misleading trade practices. It has recently become active in defending consumer interests through its truth-in-advertising rule and the Consumer Credit Protection Act.
