Chapter 11



Chapter 15

Making Economic and Social Policy

In recent years political scientists have turned their attention to the complex study of public policy--its initiation, formulation, implementation, and evaluation. They have asked such questions as: How do new issues first emerge on the national scene? Who has a voice in drafting policy to deal with the issue? How are new policies best implemented? What criteria should be applied to measure a policy's effectiveness?

There are sometimes built-in tensions between political leaders concerned with balancing off conflicting voter demands and the professional experts who deal in statistical data, cost effectiveness, and experimental models.

But this debate ignores an important ingredient of all policy decisions--money. Although government has a greater ability to borrow money than private individuals do, in the long run its ability to do things is limited by its revenues. And, to a great extent government is not a free agent, starting with a blank slate. It must pay interest on the money previously borrowed. Certain obligations are in a “must” category, such as Social Security payments. And national defense has a very high priority. Hence, government finds itself with limited choices, after these obligations are met.

Government taxation and spending were a major theme during the Reagan-Bush years. Congress attempted to control runaway deficits by passing the Gramm-Rudman-Hollings bill and then evading it by placing part of the deficit outside the agreement. The result was a strange mixture. Prices stabilized, but yearly deficits ran so high that the total exceeded that incurred by all previous presidents. During the 2000 presidential campaign, George W. Bush pushed tax cuts and smaller government.

After taking office, Clinton quickly sought a tax package which increased the taxes of the wealthy. After passage of his tax program, Clinton turned his attention to the passage of NAFTA. In his second administration, the question of balancing the budget became a major topic for Democrats and Republicans. However, this question dissolved in the wake of a budget surplus which emerged in Clinton’s second term, thanks to a booming economy. However, George W. Bush's first term experienced the reemergence of deficits, as the war against terrorism, tax cuts, and the conflict in Iraq all swallowed up the Clinton surplus.

Regulatory policy is the other key component of this chapter. The direction of government regulation has changed once again. After the Reagan-Bush years of declining regulation, Clinton created a more complicated pattern. Clinton tended to view each area separately. In the telecommunications area he pushed for deregulation while he pushed for more regulation of guns, smoking and seafood. George W. Bush's first term in office seemed in many respects to be a return to the Reagan-Bush era.

But although emphasis has shifted, a demand remains for much of the regulatory machinery. Americans do need to be protected against a polluted environment, unsafe equipment, on-the-job dangers, and monopoly price fixing. Our dilemma, then, is to maximize cost-effective beneficial regulation while minimizing overly zealous nitpicking. In a world where technology is increasingly widespread and corporations are international, protection for average citizens can come only from government.

In addition to economic and regulatory policy, the responsibility of the government to solve social problems has been debated since the drafting of the U.S. Constitution. Conservatives believe individuals should take responsibility for their own problems rather than rely on the government for assistance. In addition, they think private agencies such as charities, churches and foundations whose funds are raised via voluntary contributions from individuals and businesses should support services and programs which address health, medical, educational and housing problems for the indigent. And, when government takes responsibility for social programs, it should be at the state or local levels.

On the other end of the philosophical spectrum, liberals believe the government has the responsibility to offer and publicly fund services and programs to attain and maintain some 'minimum standard of living' for all citizens. On a practical level, liberals do not think private agencies are able to raise sufficient resources to respond to all of the educational, medical, employment, housing and nutritional needs of society. In addition, they believe that the national government ought to provide funding and set social policy standards because state and local governments are generally not willing or able to address social problems.

This chapter outlines the elements that have sustained the social policy debate over the past two hundred years and describes four efforts to change the federal government's role during the twentieth century. In two instances significant expansions of the government's role in social programming occurred; one as a result of President Franklin D. Roosevelt's New Deal and the other from President Lyndon B. Johnson's Great Society initiatives. A reduction in the federal government's leadership and funding responsibilities for social programs was sought by Ronald Reagan's administration. And, most recently, Clinton's attempted to establish new national policy in the areas of health care, welfare, education and crime control are reviewed. During the 2000 presidential campaign the social policies of education, social security and health care were major issues that the Bush and Gore camps discussed. Under the presidential first-term of George W. Bush, those policy debates continued on an active scale.

Through this chapter, we find that social policy over the last sixty years has not been static. Dramatic changes in social policy represent variations regarding how the president, Congress and American citizens have viewed the government's responsibility for providing and funding social programs. Demands to reduce the federal deficit and a change in the public's basic attitude about governmental responsibility for social programs will likely fuel debate in both near and distant future, especially as the U.S. surplus of the Clinton era changed to a growing deficit in the post-9/11 period. The traditional debate of guns v. butter was stronger than ever.

PART I--GUIDEPOSTS

1. Introduction/Making Public Policy/Economic Policy

a. What is public policy?

b. What are the major stages of public policy?

c. Who participates in public policy?

d. Why and how is "inaction" a form of policy?

e. What are some of the different policy models?

f. What has happened to the telecommunications industry since deregulation?

g. How did the framers divide economic policy-making between the branches?

h. What is fiscal and monetary policy? What is the business cycle?

2. Fiscal Policy/(in 2003, the government spent 2.1 trillion)/Budget/Taxes

a. Which taxes are the fairest? What is an excise tax? Where does the money go?

b. How widespread is the anti-tax movement?

c. What is a progressive income tax? What is a regressive tax?

d. What are entitlement programs?

e. Review the executive/legislative branches' role in the budget?

f. What is the difference between the deficit and the debt?

g. What is the role of the CBO/OMB?

h. Explain the sales tax and the VAT.

i. How do income taxes in other countries compare to those in the U.S.?

3. Monetary Policy/Promoting Economic Growth

a. What is monetary policy? What is the Federal Reserve System? How does the Fed

control inflation?

b. How was the role of government permanently changed by the Great Depression?

c. What devices does government use to manage the economy?

d. What theory of management was advanced by John Maynard Keynes?

e. How does the government promote business and trade?

f. Why do we have a trade deficit? What is the practice of "dumping"?

b. What is the purpose of GATT and the WTO?

c. What are the pros and cons of NAFTA?

d. What is the controversy over protectionism?

4. Regulating the Economy

a. What has been the history of congressional regulation? Why is there a need for

regulation? What are the types of regulation?

b. What are some typical regulatory agencies and their missions?

c. What has been the historical pattern of regulating business? Also, define

monopoly, antitrust legislation, and trusts.

d. How does regulation modify the free market concept?

e. How is organized labor regulated?

f. What are the basic criticisms of regulation?

g. How are the security markets regulated? What is "insider trading"?

h. What regulations apply to the environment? What are environmental impact

statements? What are the Kyoto Protocol and "global warming"?

5. The Deregulation Dilemma/Evaluating Regulatory Policy

a. Has airline deregulation been more beneficial to the airlines? The consumers?

b. What has been the fallout of the Telecommunications Act of 1996?

c. What positive impact do supporters of regulation offer?

d. What criticisms of regulation are offered?

c. In a general debate over deregulation, who has the better case?

6. The Role of Government in Social Policy

a. What is the proper role of government in the provision and funding of education,

health care, housing, job security, care for the elderly and public safety?

b. Why do conservatives prefer private solutions to social problems?

c. Why do liberals prefer public solutions to social problems?

d. Are social policy problems better addressed by the national government or by

state and local levels of government?

e. What impact have federally mandated social programs had on state and local

governments?

f. Should social programs differ among states or should all who benefit receive

the same treatment? Also, what are "unfunded mandates"?

g. What was the importance of the "Leave No Child Behind Act" of 2001?

h. Why are Americans divided on how much government should care for the needy?

How are the two parties split on the charity vs. government issue? How did

charity and government work together after 9/11?

7. The Early History of Social Policy in the United States/Types of Social Policy

a. What was significant about early federal programs for veterans? What

two important precedents for contemporary domestic policy were set by these

programs (entitlements; means-tested entitlements)?

b. What are categorical aid programs? What was the distinction between the

"worthy poor" and "unworthy poor"? What is meant by "public assistance"?

c. What is the meaning of "social insurance"? Name some of these programs.

8. The Expansion of Social Policy in the Twentieth Century

a. What was significant about FDR's first 100 days?

b. How did the New Deal expand the government's social policy responsibilities?

c. What benefits are provided by the Social Security Act of 1935 and subsequent amendments?

d. Why is Social Security politically popular?

e. How is Social Security funded? Why is the idea of investing social security

funds in the stock market a controversial idea? What is unemployment insurance?

f. Why may “intergenerational pressure” arise in relation to Social Security?

10. g. How did the Great Society expand the government's social policy

responsibilities? What were some of the Great Society's specific programs?

h. What beliefs about the responsibility of the federal government for social policy are rooted in the Great Society? Also, what future challenges face Medicare?

i. What position did the Clinton Administration take on welfare policy?

j. How effective has welfare reform been since 1996?

k. What is the definition of 'public assistance'?

l. How may the new welfare bill affect our federal system?

9. Social Policy Challenges for the Future: Health, Education, and Crime

a. What are the two principal methods of payment used by private health insurance providers? What is Medicaid and Medicare? What are the respective roles of the NIH, PHS, FDA, and CDC? What are HMOs?

b. Why are health costs rising? Why are there so many uninsured?

c. The "health care dollar" goes for what functions?

d. What are six approaches to health care reform?

e. What are medical savings accounts?

f. How do health care systems in other nations compare to the U.S. system?

g. What were some early federal education programs?

h. What level(s) of government were given principal responsibility for public education? How have our schools become "social centers"?

i. Why has crime control been forced onto the national political agenda?

j. What federal agencies participate in law enforcement?

k. What action has been taken against terrorism?

l. What are three reasons why the crime rate may rise in the future?

10. The Politics of Social Policy

a. What programs should constitute the government's 'safety net' for those who can't provide for themselves?

b. How should the 'safety net' be funded?

Part II — Glossary

OFFICE OF MANAGEMENT AND BUDGET - A presidential staff agency that serves as a clearinghouse for budgetary requests.

CONGRESSIONAL BUDGET OFFICE - An agency of Congress that analyzes presidential budget recommendations and estimates the costs of proposed legislation.

TARIFF - A tax on imported goods.

FISCAL POLICY - Government taxing and spending policy to manage the economy.

MONETARY POLICY - Government policy that attempts to manage the economy by controlling

the money supply and thus interest rates.

INFLATION - A rise in the general price level (and decrease in dollar value) owing to an increase in the volume of money and credit in relation to available goods.

EXCISE TAX - A consumer tax on a specific kind of merchandise, such as tobacco.

SALES TAX - A general consumer tax.

REGRESSIVE TAX - A tax that weighs most heavily on those least able to pay.

PROGRESSIVE TAX - A tax graduated so that people with higher incomes pay a larger fraction of their income than people with lower incomes.

DEFICIT - The difference between the revenues raised annually from sources of income other than borrowing and the expenditure of government, including paying the interest on past borrowing.

DEBT - The accumulated total of federal deficits, minus surpluses, over the years.

LAISSEZ-FAIRE ECONOMICS - Economic theory that opposes governmental interference.

KEYNESIAN ECONOMICS – Economic theory based on the principles of John Maynard Keynes stating that government spending should increase during business slumps and should be curbed during blooms.

FEDERAL RESERVE SYSTEM -

VALUE ADDED TAX - A tax on increased value of a product at each stage of production and distribution rather than just at the point of sale.

TAX EXPENDITURE - Loss of tax revenue due to federal tax laws that provide special tax incentives or benefits to individuals or businesses.

GROSS DOMESTIC PRODUCT - An estimate of the total output of all economic activity in the nation, including goods and services.

ENTITLEMENT PROGRAM - Government programs such as Social Security, Medicare, and unemployment insurance to which qualified citizens are “entitled” by national legislation.

MONETARISM - The theory that money supply is the key factor in the economy's performance.

GATT - An international trade organization with 125 members, including the United States, that seeks to encourage free trade by lowering tariffs and other trade restrictions.

NAFTA - Agreement signed by the United States, Canada, and Mexico in 1992 to form the largest free-trade zone in the world.

REGULATION - The attempt by government to control the behavior of corporations, other governments, or citizens through altering the natural workings of the open market to achieve some desired goal.

DEREGULATION - A policy promoting cutbacks in the amount of federal regulation in specific areas of economic activity.

PROTECTIONISM - A policy that favors domestic producers or workers.

ENVIRONMENTAL IMPACT STATEMENT - The statement required in all proposals, using federal funds, analyzing their result on the environment.

CLOSED SHOP - A company with a labor agreement whereby union membership is a condition of employment.

UNION SHOP - A company in which new employees must join a union within a stated time period.

COLLECTIVE BARGAINING - Direct negotiations between an employer and a union over employment conditions.

LABOR INJUNCTION – court order prohibiting certain acts such as performing a strike.

OSHA - The federal agency concerned with employee safety and health.

MONOPOLY - Technically, a market in which only one supplier exists. Commonly, a market with few suppliers (oligopoly).

SHERMAN ANTI-TRUST ACT (1890) - The first major national law designed to prevent business monopoly and preserve competition.

TRUST - A monopoly that controls goods and services, often in combinations that reduce competition.

WORLD TRADE ORGANIZATIONS (WTO) – Trade organization that negotiates free trade and quotas.

UNFUNDED MANDATES - Federal policies imposed upon the states with little or no federal funding for implementation.

NEW DEAL - A series of relief programs established by the federal government during Franklin D. Roosevelt's administration to stimulate the economy and put people back to work.

SOCIAL SECURITY ACT - The original act (1935) and subsequent amendments established an insurance system supported by employee and employer taxes which provide pensions for retired workers, financial support for disabled workers and for children of deceased or disabled workers, and health insurance of retired and disabled persons.

ENTITLEMENTS -Programs such as unemployment insurance, disaster relief, or disability payments that provide benefits to all eligible citizens

MEANS-TESTED ENTITLEMENTS - Programs such as Medicaid and welfare under which applicants must meet eligibility requirements based on need.

PUBLIC ASSISTANCE - Aid to the poor, or "welfare."

SOCIAL INSURANCE - Programs in which eligibility is based on prior contributions to government, usually in the form of payroll taxes.

MEDICARE - The national health insurance program for the elderly and disabled.

MEDICAID - A medical benefits program for low-income persons funded largely by the federal government but administered and partially funded by the states.

HEALTH MAINTENANCE ORGANIZATION - Alternative means of health care in which people or their employees are charged a set amount and the HMO provides health care and covers hospital costs.

MEDICAL SAVINGS ACCOUNT - Alternative means of health care in which individuals make tax deductible contributions to a special account that can be saved from year to year and used to pay for medical expenses.

TRADE DEFICIT – An imbalance in international trade in which the value of imports exceeds the value of exports.

SOCIAL SECURITY – A combination of entitlement programs, paid for by employer and employee taxes, that includes retirement benefits, health insurance; and support for disabled workers and the children of the deceased or disabled workers.

Part III — Pretest

Economic Policy:

1. The Federal Reserve banks serve all but one of the following functions.

a. insures bank deposits c. regulates banks

b. determines money supply in economy d. influences interest rates

2. The economist who first urged that government should fill any gaps left by a deficit of private spending and investment was

a. Adam Smith. c. John K. Galbraith.

b. John M. Keynes. d. Paul Samuelson.

3. An estimate of the total output of all U.S. economic activity is the

a. GDP. c. GAO.

b. OMB. d. VAT.

4. Critics of NAFTA worry about all of the following EXCEPT

a. lax Mexican antipollution laws c. Mexicans working for low wages

b. inferior Mexican products d. U.S. companies moving to Mexico

5. The substance of what government does is called

a. lobbying. c. bargaining.

b. lawmaking. d. public policy.

6. Federal taxing and spending is considered _______ policy.

a. fiscal c. laissez-faire

b. monetary d. regressive

Regulatory Policy:

7. The FCC is concerned with

a. radio and television. c. the environment.

b. new drugs. d. nuclear power.

8. The alternative to regulation is

a. socialism. c. laissez faire.

b. mercantilism. d. incrementalism.

9. The basic law designed to control monopolies is the

a. Clayton Act. c. Sherman Act.

b. Taft-Hartley Act. d. Wagner Act.

10. Most regulation of union activity is assigned to the

a. Federal Trade Commission.

b. Antitrust Division of the Justice Department.

c. National Labor Relations Board.

d. Department of Labor.

11. OSHA is mainly concerned with

a. industrial safety. c. nuclear power plants.

b. air/water pollution. d. minimum hourly wages.

12. GATT is mainly concerned with

a. global warming. c. anti-trust legislation.

b. encouraging free trade. d. U.S.-Mexican trade

13. The Clean Air Act was passed during the _______ Administration.

a. Reagan c. Bush

b. Carter d. Clinton

Social Policy:

14. President Lyndon B. Johnson was successful in getting Congress to enact the Great Society's social programs. Which of the following was not a Great Society program?

a. SSI

b. Head Start

c. Social Security

d. Medicaid

15. The New Deal included all but which of the following programs?

a. Works Progress Administration (WPA)

b. Comprehensive Employment and Training Act (CETA)

c. Tennessee Valley Authority (TVA)

d. Civilian Conservation Corps (CCC)

16. The clause of the U.S. Constitution that supports a social policy role for the federal government is the ___________clause.

a. separation of powers c. equal opportunity

b. due process d. general welfare

17. Social Security benefits are paid to almost _____ Americans every month.

a. 50 million c. 28 million

b. 38 million d. 8 million

18. Health care costs have risen nearly _____ percent since 1970.

a. 200 c. 400

b. 300 d. 500

19. The earliest federally-supported assistance program was given to the nation's

a. poor.

b. citizens who were formerly slaves.

c. veterans.

d. farmers.

20. Brown v. Board of Education led to

a. school desegregation.

b. incentives to improve schools for poor children.

c. school busing.

d. all of the above

Part IV — Programmed Preview

ECONOMIC POLICY:

Knowledge Objective: To examine the nature of policy making

1. The first step in policy-making is problem _____.

2. The process during which alternative solutions to a policy problem are explored is called policy _____.

3. "Is the policy working" refers to policy ___________.

4. The process during which policy is translated into practice is called policy _____.

5. Benjamin Franklin once said that nothing was certain but death and _____.

6. The greatest source of income for the federal government is the _____ and ____ tax.

7. An income tax that has higher rates for higher incomes is called _____.

8. Social Security taxes are _____ because they fall most heavily on low income people.

9. The GDP stands for the Gross _______ _________.

Knowledge Objective: To analyze the budget: income and expenditures

10. Consumer taxes on merchandise are called _____ taxes.

11. The two largest categories of spending in rank order are _____ and _____.

12. The interest on the federal debt is more than ____ billion each year.

13. The national ______ is the total of our deficits, minus our surpluses.

14. Departmental budgets are coordinated by the Office of _____ _____ _____.

15. The federal government began running budget _______ (surpluses, deficits) in 2002.

Knowledge Objective: To examine politics of taxing and spending

16. The _____ tax hits those most able to pay and hardly touches those at the bottom of the economic ladder.

17. The _____ tax is the most controversial.

18. Americans pay _________ (more, less) in taxes than other countries.

19. VAT stands for _____ ______ tax.

20. Critics argue that the rich become wealthy through tax _________.

Knowledge Objective: To analyze policies used by the national government to manage the economy

21. The British economist _____ _____ _____ urged government intervention if private investment was inadequate.

22. The economic theory that advocates control by regulating the supply of money is called _____.

23. Monetary policy is made by the _____ _____ _____.

24. Fed selling of bonds is ________ (deflationary, inflationary).

25. The current Fed Chairman is Alan ___________.

26. The most visible promoter of business is the Department of ___________.

Knowledge Objective: To examine the arguments between protectionists and free traders

27. Most economists and diplomats favor _____ trade.

28. As we enter the 21st century, trade barriers are ______ (more, less) severe than they were in the 1930s.

29. Advocates of free trade argue that protectionist devices (raise, lower) _____ prices for U.S. consumers.

30. The principal device used by governments to protect their industry against foreign imports has been the _____.

31. GATT has had (some, no) success in lowering tariffs and quotas to increase fair trade.

32. The largest free trade zone was formed by the _____ _____ _____ _____ Agreement, involving the nations of Mexico, Canada, and the United States.

REGULATORY POLICY:

Knowledge Objective: To examine the reasons for and trends in regulation

33. Regulations exist to encourage economic _____ and _____ objectives.

34. Domination of an industry by a single company is called _______.

35. The author of Unsafe at Any Speed was Ralph _________.

36. Supporters of regulation argue that it (improves, limits) _____ the quality of American life.

37. The __ ____ is a daily publication of proposed and existing federal regulations.

38. Regulation compensates for market ________.

39. The aim of antitrust laws is to encourage _____.

40. Electric utilities are an example of a _____ monopoly.

41. _____ regulation attempts to provide clean air and consumer safety.

42. The social costs of regulation are relatively (difficult, easy) _____ to establish.

Knowledge Objective: To trace government attempts to maintain business competition

43. Congress in 1890 attempted to curb monopolies by passing the _____ _____ Act.

44. A ______ is a monopoly that controls goods and services often in combinations that reduce competition.

45. OSHA’s mandate was to protect the ______ and ______ of 60 million workers.

46. Regulation of U.S. business has become more difficult in recent years because the marketplace has become _____.

Knowledge Objective: To consider the major legislation affecting labor management relations/the environment/deregulation.

47. Labor leaders generally _____ federal regulation.

48. Most labor laws regulate the relationship of workers with _____.

49. The Taft-Hartley Act placed limitations on _____.

50. A company in which new employees must join a union within a stated period of time is called a ______ shop.

51. In general, airline deregulation has resulted in ______ (lower, higher) fares.

52. One controversial aspect of The Telecommunications Act of 1996 was the advent of

the _____ chip.

SOCIAL POLICY:

Knowledge Objective: To examine the role of government in social policy

53. President Clinton's 1996 welfare reform program shifted responsibility to the _____.

54. Actions taken by the government to meet minimal human needs in nutrition, housing, education, health care and public safety constitute _____ policy.

55. _____ favor private approaches to social policy and prefer that when necessary, social problems be addressed by state and local governments.

56. The federal government now gives ______ grants to the states for their welfare programs.

57. Governors are concerned about the tendency of the federal government to _____ social programs that states must administer with little or no federal funding.

Knowledge Objective: To review the history of social policy in the U.S.

58. Early on, the United States was (ahead, behind) _____ other western democracies in providing social services.

59. The great Depression of the 1930s drastically expanded the involvement of the _____ government in social programs.

60. _____ _____ was the widely help philosophy that if people did not get ahead, it was their own fault.

Knowledge Objective: To understand the nature of Social Security

61. _____ _____, an entitlement program, is politically untouchable because everyone benefits, regardless of need.

62. Social Security now covers more than _____ % of the American workforce.

63. _____ and _____ will cause 'intergenerational tension' over Social Security.

Knowledge Objective: To examine the federal government's role related to poverty

64. The 1996 Welfare Reform legislation marked a ________ (reversal, affirmation) of

Great Society thinking.

65. Some believe that the best way to encourage marriage among welfare recipients is to find them good-paying _________.

66. Federally-funded assistance is limited to ______ years over a person's lifetime.

67. Head Start provided ________ education to _______ children.

68. Welfare reform occurred under the presidency of ________.

69. In absolute numbers, most poor people are ________ (race).

70. The official government figure is that women make ____ cents for every dollar earned by men.

71. The “______” of poverty refers to many _________ being poor.

72. The _____ program provides extra support for the elderly poor, the blind, and disabled.

73. Since welfare reform, the number of people on welfare has ______ (declined, increased).

Knowledge Objective: To examine the federal government's role in health care

74. The NIH stands for the National _______ of _________.

75. "Disease detectives" are represented by federal agency _______ in Atlanta.

76. Doctors increasingly object to the high cost of ________ insurance.

77. The Public Health Service is headed by the ________ ________.

78. The second largest percentage of the health care dollar goes for _______ _______.

79. ________ is the national health insurance program for the elderly and the disabled.

80. HMOs stand for _______ _______ ________.

81. There are approximately ____ million uninsured Americans.

82. Conservatives especially like the ______ market approach to health care reform.

83. Canada's administrative costs per patient are ___-___ (fraction) of those in the U.S.

84. A medical savings account ______ (passed, defeated) in Congress.

Knowledge Objective: To examine the federal government's role related to education

85. _____ launched by the Soviet Union in 1957 facilitated the expansion of federal funding for education.

86. The _____ enacted after World War II has financed the education of 20 million veterans.

87. In 1954, the U. S. Supreme Court in Brown vs. The Board of Education declared _____ to be inherently unconstitutional.

88. More than one-___ of all college students receive some federal financial aid.

89. The Head ______ program is intended to help preschool children..

90. Today, schools have become one-stop _______ centers.

91. Public education has traditionally been under the control of the _____ and _____ governments.

92. In 1862, the ______ ______ Grant Act provided resources to states for universities

specializing in the mechanical or agricultural arts.

Knowledge Objective: To examine the federal government's role related to crime control

93. Controlling crime is mainly a local and _______ matter.

94. The "three strikes and you're out" provision mandates _______imprisonment upon

conviction for a third violent felony.

95. The _____ ____ imposed a 5-day waiting period on the purchase of hand guns to allow background checks to be done.

96. Since 9/11, fighting _______ has become the government's top crime priority.

97. Preventing the flow of illegal narcotics is the job of the _____ ______ Agency.

98. After 9/11, the passage of the USA PATRIOT act allowed "______" wiretaps.

Knowledge Objective: To review social policy concerns for the 1990s

99. _____ coined the word 'safety net' to describe the social programs which are funded and provided by government.

100. Social security and _____ _____ coverage played a role in the 2002 midterm elections.

PART V—POST-TEST

Economic Policy:

1. The U.S. government levies excise taxes on all BUT one of the following.

a. gasoline c. liquor

b. real estate d. plane tickets

2. Spending by the national government today represents _____ of GOP.

a. one-half c. one-fifth

b. one-third d. one-tenth

3. In rank order, the largest tax sources of government income are

a. personal income, payroll taxes, and corporations.

b. corporations, excises, and personal income.

c. social insurance, corporations, and personal income.

d. personal income, corporations, and excises.

4. Supply-side economics places its chief emphasis on

a. production. c. conservation.

b. consumption. d. regulation.

5. The result of government farm programs has been

a. massive bankruptcies. c. cheap food.

b. higher production. d. elimination of surpluses.

6. The mortgage interest deduction is considered a:

a. VAT. c. tax expenditure.

b. tool of monetarist theory. d. regressive tax.

Regulatory Policy:

7. Deregulation is being implemented in all of the following areas except

a. education. c. airlines.

b. railroad. d. trucks.

8. The attitude of the Reagan administration toward regulation was best summarized in the slogan

a. we need more. c. let's be tougher.

b. let's have less. d. there we go again.

9. Our first efforts at regulation were intended to

a. encourage unions. c. protect consumers.

b. preserve competition markets. d. curb pollution.

10. The end result of nearly a century of antitrust legislation is that

a. business concentration exists. c. business is widely dispersed.

b. monopolies are commonplace. d. cutthroat competition is the norm.

11. Under the Telecommunications Act of 1996 local telephone companies won the right to do all but

a. provide long distance service c. offer video service.

b. manufacture telephones d. gain exclusive control over their networks

12. The right to organize and bargain collectively was guaranteed by the _____ Act.

a. Wagner c. Taft-Hartley

b. Sherman d. Walsh-Healey

13. The Taft-Hartley Act does not outlaw

a. the closed shop. c. jurisdictional strikes.

b. the union shop. d. secondary boycotts.

14. The basic criticism of OSHA appears to be that its regulations were too

a. lax. c. endless and patronizing.

b. irrelevant. d. ineffective.

Social Policy:

15. The reason for the crime rate increasing in recent years is due to.

a. more prisoners being released.

b. the rising number of teenagers.

c. persistent urban poverty.

d. all of the above.

16. The Social Security system is presently

a. bankrupt. c. breaking even.

b. running a surplus. d. running a deficit.

17. The largest percentage of the federal government dollar goes for

a. medicare.

b. social security.

c. national defense.

d. interest on the national debt.

18. The federal program created in 1965 to provide basic health services for the poor and

which covers everything from hospital care to family planning is

a. Head Start.

b. SSI.

c. Medicare.

d. Medicaid.

19. As of 2002, full social security benefits can be obtained by people reaching the age of

a. 60 c. 62

b. 65. d. 70

20. The United States generally has a decentralized criminal justice system except for the following agency(ies) which provide direct assistance to state and local governments.

a. FBI c. FBI and ATF

b. DEA d. FBI, DEA, and ATF

Part VI — Political Dialogue:

The Clash of Issues and Ideas

1. Policy models: Select an issue that has sharply divided the American people over a considerable period of time. Try to apply all the policy-making models to the issue that is selected, to demonstrate how it is possible to believe in each theory. Possible issues that lend themselves to this treatment include:

a. Affirmative action programs d. Abortion

b. National health insurance e. Crime and violence

c. Federal aid to education f. Tax cuts

2. Farmers appear to be favored in the part of the national government's budget that is given over to non-defense expenditures.

a. Is this because their problems and needs are greatest?

b. Do they have greater voting strength than urban residents, school children, and migratory workers?

c. Review what you know about the voting habits of low income groups. Does this throw any light on Congressional appropriations?

d. Does the American system guarantee that the greatest need will get the greatest attention? Why? Why not?

3. You are a U.S. Representative from a large industrial state. Among your committee assignments is one involving tariff revisions. Testimony before your committee has demonstrated that foreign automobile imports have now captured a high percent of the U.S. market and that the percentage is steadily rising. The American companies want quotas placed on foreign imports. They are particularly concerned about Japan, which has an efficient, expanding automobile industry that now has the bulk of the U.S. import market. However, a spokesman for Japan has pointed out that Japan is the second-biggest customer for U.S. made products and that to buy she must sell.

How will you make your decision? Are American consumers helped by having cheap Japanese autos? Should countries with low labor scales be barred from the U.S. market? Should the government protect a high price industry? What do you think would happen to energy consumption if all foreign autos were barred from the U.S.? What should we do as Korea and other nations enter the American market?

4. Analyze the short and long-term impact of airline deregulation. Cover the following points:

a. The emergence and disappearance of new airlines (Ozark, Peoples Express, Piedmont, Braniff).

b. The fare wars.

c. Passenger safety.

d. Why the mergers left some communities without adequate service.

e. What will be the final result.

f. Should we have a national airline, like Japan?

5. Some states have adopted “lemon laws” that give buyers protection against badly built cars, by forcing companies to give free repairs or refunds. We should have a national law that covers all cars sold in the United States. Do you agree? Disagree? Why?

6. The general rule in all forms of social regulation is that each restriction has a cost that must be weighed against the social benefit. In the case of energy regulation, indicate the social cost involved in each of the following actions:

a. Requiring increased use of coal

b. Halting construction of nuclear plants

c. Improving automobile gasoline mileage

d. Encouraging the production of shale oil

e. Limiting production of SUVs

f. Increasing oil imports

g. Building more nuclear plants

7. In November 1994, the voters of California in a 59% - 41% vote approved Proposition 187. The law effectively denies public education, health and other social services to hundreds of thousands of illegal immigrants who are currently in the state of California. Gov. Pete Wilson indicated that it costs the state about $2.3 billion per year to provide the services for which there is no federal reimbursement. Immediately following the election, actions to delay implementation of the law were filed in state and federal courts. Both courts blocked implementation until issues concerning the constitutionality of Prop 187 were studied.

Research the outcome of Prop 187. What constitutional issues were raised? What did the courts ultimately decide? What were the bases for the courts' decisions? Why did Gov. Wilson support this referendum? What social policy philosophy is embodied in Prop 187? What were the socio-economic characteristics of those who voted for the referendum? Is a Prop 187-like action the appropriate strategy for states that wish to rebel against federal mandates?

8. The 1996 Welfare Legislation will put an end to the creation of a permanent underclass. Agree or disagree?

9. Do you believe that social security will be solvent when you reach retirement age?

Why or why not?

Part VII — Political Science Today

1. Whenever the Federal Reserve Board raises or lowers interest rates or even indicates a change may occur, the reactions of the securities markets, mortgage rates, car loans, etc. can be significant. Review national newspaper articles published over the last five years about the impact of the Federal Reserve Board’s decisions to adjust interest rates. Summarize your findings in a short paper.

2. Argue for and against the following proposition: Cigarette sales, especially to minors, should be strictly regulated by the federal government. Cigarettes should therefore be branded as a dangerous drug by the government.

3. In recent years, trade related tensions between the U.S. and some of its allies, most notably Europe, China, and Japan, have grown. The massive trade deficit has prompted some members of Congress and the business community to demand “protection” from the influx of goods from foreign producers. What might occur if the U.S. became strongly protectionist against Japan/China? Might this help or hurt American business and consumers in the short and long term? How might prices for cars, trucks, electronic equipment, etc. be affected? Review articles and commentary from newspapers and magazines to provide background for your thoughts.

4. Would you favor the federal government allowing vehicle manufacturers to install switches to de-activate the passenger side air bag as a measure to protect children and smaller sized adults from being killed by air bags? Why or why not?

6. Despite the best efforts of the Clinton Administration to achieve a national health program over a 20 month period, the president and his congressional supporters admitted defeat in late September of 1994. Fierce attacks on Clinton's government-run, universal health care program by Republicans and the health-insurance lobbies eventually turned public support for Clinton's plan into a mixture of derision and apathy. However, Democrats promised that the fight for a restructuring of health care would begin anew in 1995, albeit the plan would be far more “incremental”, i.e., probably far less than full health coverage for all Americans. But complicating matters was the Republican midterm election sweep in November, giving them control of Congress. In short, the future of major health care reform was uncertain.

Have any new health care proposals been enacted since 1995? If so, what are they? If not, why not? Research the proposals that were evident during the first term of George W. Bush.

7. The Clinton Administration was successful in passing a comprehensive crime bill in late July of 1994. The bill provided for 100,000 more police on the nation's streets over a six year period, banned a variety of assault weapons, allowed more funding for the construction and running of prisons, expanded the federal death penalty to other crimes (including carjacking), allocated billions for crime prevention/rehabilitation programs, and initiated college scholarships for students who wished to pursue law enforcement careers. However, there was some question among the GOP opposition as to how all of these programs would be funded. (After the November elections, some Republicans insisted that they would change the bill in 1995 since they now controlled Congress.) Some law-enforcement officials also doubted whether this bill would really reduce the crime rate in America. Research whether the bill was changed in 1995 and also why some law-enforcement officials doubted the crime-fighting efficacy of the bill. Update through 2003.

8. Would an increased federal tax on tobacco be a good or bad idea? Research the issue.

Part VIII — Data Analysis

1. Why is the budget process so often a lightning rod for conflict between Congress and the President? Review the budget problems that occurred between the GOP-run Congress and President Clinton, especially during Clinton’s second term. Now look at the problems during President George W. Bush’s first term, especially regarding tax cuts.

2. In late 1994, the FAA--Federal Aviation Administration--began to question the safety of the nation's civilian jetliners. The airline companies, confronted with shrinking profits, were extending the flight-lives of aircraft rather than investing in new, very expensive planes. Many of these older planes were 20 to 30 years of age. Several had crashed due to in-flight structural failures. The airlines insisted that they were maintaining these aircraft according to FAA guidelines. Furthermore, it was far cheaper to fix these old planes, thus allowing them to fly for additional decades.

Do follow-up research on this issue. Has the FAA implemented even tougher aircraft regulations? Have consumer organizations, former federal employees, aviation experts and/or members of Congress pressured the FAA to take action? Cover the 2001-2004 period.

3. Two criticisms of regulation are that it “increases costs to industry and to the consumer” and it “has often been introduced without cost-benefit analysis.” Research and prepare class presentations which address the pros and cons of these arguments.

4. Is there a specific environmental problem that affects your local community and/or state? If so, research the origins of this problem and the “solutions” which government is offering.

5. Have cable rates in your town gone up over the past few years since deregulation? If so, by how much? Contact your local cable company for an explanation.

6. Social Security is considered a political “untouchable” in Washington, D.C. Cuts in Social Security would definitely help in reducing the federal budget, but few politicians wish to propose such a course of action for fear of political retaliation at the polls. Interview your grandparents, senior citizens, other over-60 relatives, or even your own parents. Simply ask this “target population” whether they would accept cuts in Social Security payments and record their responses. Be sure to probe more deeply as to the reasons behind those individual responses. After completing your interviews, do you have a better idea as to why Social Security is considered a “sacred political cow?”

7. Using a similar interview approach used in Exercise #6, ask your classmates a series of questions about contemporary American education. First, would they favor or oppose the federal government establishing a national curriculum that would standardize educational standards and requirements in all 50 states? Second, would they favor or oppose extending the traditional 180 day school year to 220 or even more, a length comparable to educational practice in Japan? Third, would they favor or oppose extending the traditional three or four years in high school by at least one additional year before a high school degree could be achieved? Fourth, would they favor a new, expanded federal loan program, funded by an increase in federal income taxes, that would permit thousands of low-income high school graduates to attend the college or university of their choice? Once again, be sure to identify reasons behind those responses. Collect your data and use it in writing a short paper on American education.

8. Investigate how the 1996 welfare reform law was implemented in the state where you live. Has the state created any experimental programs as part of the implementation process? You might learn more about your state's welfare reform activities by visiting the local public welfare office or inviting a member of the welfare office staff in to talk with the class about the changes that have occurred.

Part IX — Test Answers

Pretest

1. a 11. a

2. b 12. b

3. a 13. c

4. a 14. c

5. d 15. b

6. a 16. d

7. a 17. a

8. c 18. c

9. c 19. c

10. d 20. d

Programmed Review-Economic Policy

1. identification 17. sales

2. formulation 18. less

3. evaluation 19. value added

4. implementation 20. loopholes

5. taxes 21. John Maynard Keynes

6. personal and corporate income 22. monetarism

7. progressive 23. Federal Reserve System

8. regressive 24. deflationary

9. gross domestic product 25. Greenspan

10. excise 26. Commerce

11. social programs; defense 27. free

12. 180 28. less

13. debt 29. raise

14. Management and Budget 30. tariff

15. deficits 31. some

16. progressive 32. North American Free Trade

Programmed Review-Regulatory Policy

33. competition; social 46. international

34. monopoly 47. favor

35. Nader 48. employers

36. improves 49. unions

37. Federal Register 50. union

38. imperfections 51. lower

39. competition 52. “V”

c. 40. natural

41. Social

11. 42. difficult

43. Sherman Antitrust

12. 44. trust

45. health, safety

Programmed Review-Social Policy

53. states 81. 44 million

54. social 82. free

55. Conservatives 83. one-fourth

56. block 84. passed

57. mandate 85. Sputnik

58. behind 86. G. I. bill

59. federal 87. separate but equal school

60. rugged individualism facilities

61. Social Security 88. third

62. 90% 89. Start

63. Increased life expectancy; 90. social

steady decline in the birth rate 91. state and local

64. reversal 92. Morrill Land

65. jobs 93. state

66. five 94. life

67. preschool; poor 95. Brady Act

68. Clinton 96. terrorism

69. white 97. Drug Enforcement

70. 73 98. roving

71. feminization; women 99. Ronald Reagan

72. SSI 100. prescription drugs

73. declined

74. Institutes; Health

75. CDC

76. malpractice

77. Surgeon General

78. hospital care

79. Medicare

80. health maintenance organizations

Post-test

1. b 11. d

2. b 12. a

3. a 13. b

4. a 14. c

5. b 15. d

6. c 16. b

7. a 17. b

8. b 18. d

9. b 19. b

10. a 20. d

Data Analysis

Answers to all data analysis problems will depend upon each student's research effort.

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