Unit 6 Review

20 Multiple Choice1 FRQ

The Policymaking Process Every policy has a unique history, but each

generally goes through five basic steps.

1. Agenda Setting2. Policy Formulation3. Policy Adoption4. Policy Implementation5. Policy Evaluation

Public Policy

Making a Decision

• Politics a process of settling disputes about who benefits and who ought to benefit

• People prefer programs that provide benefits at low cost

• Perceived distribution of costs and benefits shapes the kinds of political coalitions that form but not who wins

Public Policy

Types of Policy Politics: BreakdownCosts Benefits

Majoritarian Large group Large group

Interest Group Small Group Small group

Client Large group Small group

Entrepreneurial Small group Large group

Public Policy

Fiscal Policy Managing the economy by the use of tax and

spending laws.

• Where the Money Comes From– Federal Income Taxes– Social Insurance Taxes– Borrowing– Other taxes

• Where the Money Goes– Entitlement programs– National defense – National debt

Economic Policy

Monetary PolicyManaging the economy by altering the

supply of money and interest rates

• Monetary policy is the government’s control of the money supply– Too much money in system leads

to inflation (devaluation of dollar)– Too little money in circulation

leads to deflation

Economic Policy

Economic Theories & Political Needs • Monetarism – inflation occurs when there is too much

money chasing too few goods; – Govt reacts by cutting amount of $ in circulation -triggers recession– Monetarists advocate increase in money supply about equal to the

rate of economic growth (slow and steady wins the race)• Keynesianism – government should create right level of

demand– Too little = production declines • Govt should spend more to stimulate econ

– Too much = prices rise, shortages occur • Govt should tax more or cut spending

• Planning – free market too undependable to ensure economic efficiency; therefore government should control it

– Government should have ability to set prices and wages to create healthy and stable economy Economic Policy

Economic Theories & Political Needs • Supply-side tax cuts – need for less government interference

and lower taxes (opposite of planning advocates)– Cut taxes people will save and invest greater econ

productivity will increase tax revenue (and people won’t feel the need to “cheat” on their taxes!)

• Ideology and theory: people embrace an economic theory partly because of their political beliefs

– Conservative: Monetarism, Supply-side (less govt)– Liberal: Keynesian (more programs)– Socialist: economic planning

• “Reaganomics”: Combination of monetarism, supply-side tax cuts, and domestic budget cutting

– Slowed govt spending on most programs (but raised military $$)– Cut income taxes

= big deficits!! But the economy was stimulated!

Economic Policy

The Machinery of Economic Policy Making

• The Fed (Federal Reserve Board)– 7 members, Pres appointed-Senate confirmed, 14yr

terms– Regulates the supply of money and interest rates

(=monetary policy)– Independent of Pres and Congress (though sometimes

questionable)

• Congress – Most important! Creates the nation’s tax and spending

laws (= fiscal policy)

Economic Policy

Social Policy: An overview• Government’s responsibility for the welfare of its citizens

remains controversial and disputed today• Generally 2 types of programs:– Majoritarian- benefits almost everyone

• Ex. Social Security, Medicare

– Client- benefits only a small number• Ex. Medicaid, Food Stamps• Means tested- must fall below a certain income level to qualify

• Entitlement programs: government-sponsored programs providing mandated benefits to those who meet eligibility requirements

Social Policy

Client welfare programs: AFDC• Problems:– States complained about federal regulations – Public opinion turned against program

• Corruption• Weakened the family (got more money for more kids)

– Composition of program participants changed • 1970: half of women were widowed/divorced• 1994: only 1 quarter, the rest never married• Also, 2/3 of women were on for 8 years or more!

• Temporary Assistance to Needy Families (TANF) 1996– Stricter requirements and limits on how long families could

collect– Lowered welfare caseload by 60%

Social Policy

Pros and Cons: Client politics

• Programs pass if cost to public not perceived as great and client considered deserving

• Americans believe today that able-bodied people should work for welfare benefits

• Americans prefer service strategy to income strategy (give service/training rather than money)– Charles Murray: high welfare benefits made some

young people go on welfare rather than seek jobs – No direct evidence supports Murray

Social Policy

Checks on President’s Power• Political rather than constitutional• Congress controls the $$$• War Powers Act of 1973- restricts the president– If Pres commits troops he must report it to Congress

within 48 hours– Only 60 day commitment w/o declaring war– Previously, Congress could use legislative veto to bring

troops home Has had very little influence, politically impossible

(Congress will of course support successful military action)

Military/Foreign Policy

Effects of War Powers Act• Congress rarely invokes it– Ford, Carter, Reagan, Bush, Clinton all sent troops

w/o authorization• Politically impossible– Congress wouldn’t challenge successful military

action (even Vietnam)• Constitutionality is questionable (so they don’t

push it)

Military/Foreign Policy

Structure of Defense Decision Making• National Security Act of 1947- created Dept of

Defense– Headed by Sec. of Defense (must be civilian)- command

authority over defense on behalf of pres– Sec. of Army, Air Force, Navy, (also civilians) • manage daily functions

– Joint Chiefs of Staff (military)• Branches of military kept separate- Why?– Fear if unified they would become too powerful– Desire of services to preserve autonomy– Inter-service rivalries intended by Congress to increase

info Military/Foreign Policy

Majoritarian PoliticsClean Air Act 1970- tough restrictions on pollutants from

automobiles• Started as entrepreneurial- public w/ media support

demanded changes• Small provision of law said states would have to restrict use

of cars if pollution problem persisted– Huge popular opposition, efforts failed (Congress and EPA backed

down)• Consumers, auto industry, unions objected• Loss of horsepower, competitiveness, jobs

• Clean Air Act revived in 1990 w/tougher restrictions, but a 20 year deadline

• Most current laws target particular industriesEnvironmental Policy

Majoritarian Politics• When people believe costs are low:– National Environmental Policy Act 1969 (NEPA)• Required Environmental Impact Statement (EIS) for any

project “significantly affecting human environment”• Overwhelming support, but caused lots of lawsuits and

delays

• When people believe costs are high:– Increase in gas tax– Most would pay, most would benefit, but benefits not

obvious• More accepted if benefits concrete, like highways, bridges,

etcEnvironmental Policy

Good to Know

• Understand the current implications of policy initiatives…especially social.

• Look out for graphs!• Know examples of environmental policy