Chapter 15 & 16 Test Review

Domestic Policy

All of the laws, government planning, and government actions that affect each individual’s daily life (ex: poverty, health care, the environment)

Policy Making Process

Agenda Building > Policy Formulation > Policy Adoption > Policy Implementation > Policy Evaluation and Revision

Medicare

Created in 1965; a federal health insurance program that covers residents age 65 and older. The costs are met by a tax on wages and salaries.

Medicaid

A joint state-federal program that provides medical care to the poor. Funded by general government revenues.

National Health Insurance

A plan in which the government provides basic health care coverage to all citizens. Most of these plans are funded by taxes on wages and salaries.

Single-Payer Plan

A plan under which one entity has a monopoly on issuing a particular type of insurance. Typically, the entity is the government, and the insurance is basic health coverage.

Environmental Impact Statement (EIS)

A report that must show the costs and benefits of major federal actions that could significantly affect the quality of the environment

Sustainability

Achieving a balance between society and nature that will permit both to exist in harmony

Energy Policy

Laws concerned with how much energy is needed and used

Income Transfers

A transfer of income from some individuals in the economy to others, generally by government action

In-Kind Subsidy

A good or service - such as food stamps, housing, or medical care - provided by the government to low-income groups

Temporary Assistance to Needy Families (TANF)

A state program in which grants from the national government are used to provide welfare benefits. Replaced the Aid to Families with Dependent Children (AFDC) program.

Supplemental Security Income (SSI)

A federal program established to provide assistance to elderly persons and persons with disabilities

Food Stamps

Benefits issued by the federal government to low-income individuals to be used to purchase food

Earned Income Tax Credit (EITC) Program

A government program that helps low income workers by giving back part or all of their Social Security taxes

Glass-Steagall Act

A law passed in 1933 to regulate the banking industry which prohibited banks from engaging in speculative investments or becoming investment houses

Inflation

A sustained rise in the general price level of goods and services

Recession

Two or more successive quarters (6 months) in which the economy shrinks instead of grows

Unemployment

The inability of those who are in the labor force to find a job

Full Employment

An arbitrary level of unemployment that corresponds to “normal” friction in the labor market. Today, it is assumed to be around 5 percent.

Consumer Price Index (CPI)

A measure of the change in price over time of a specific group of goods and services used by the average household

Business Cycle

Prosperity > Recession > Depression > Growth

Fiscal Policy

The federal government’s use of taxation and spending policies to affect overall business activity

Monetary Policy

The utilization of changes in the amount of money in circulation to alter credit markets, employment and the rate of inflation

Laissez-Faire Economics

Governments “hands off approach” to the economy. Little regulations on businesses.

Keynesian Economics

An economic thought that tends to favor active federal government policy making to stabilize economy-wide fluctuations, usually by implementing fiscal policy

Supply Side Economics

An economic theory that holds that the answer to inflation is to reduce government regulation and cut taxes so that businesses will produce more products. Oversupply will drive down prices.

Budget Deficit

Government spends more than it receives

U.S Treasury Bond

Debt issued by the federal government

Gross Public Debt

The net public debt plus inter agency borrowings within the government

Net Public Debt

The accumulation of all past federal government deficits; the total amount owed by the federal government

Gross Domestic Product (GDP)

The dollar value of all final goods and services produced in a one-year period

Loophole

A legal method by which individuals and businesses are allowed to reduce the tax liabilities owed to the government

Progressive Tax

A tax that rises in percentage terms as incomes rise (Federal income tax, state income tax, federal corporate income tax, estate tax)

Regressive Tax

A tax that falls in percentage terms as incomes rise (Social security tax, medicare tax, state sales tax, local real estate taxes)

Federal Reserve System (the Fed)

The most important regulatory agency in the U.S monetary system. The Fed performs important functions such as regulating the amount of money in circulation and providing a system for transferring checks from one bank to another.

Federal Open Market Committee

The most important body within the federal reserve system. They decide how monetary policy should be carried out.

Tight Monetary Policy

Monetary policy that makes credit expensive in an effort to slow the economy

Loose Monetary Policy

Monetary policy that makes credit inexpensive and abundant, possibly leading to inflation

Imports

Goods and services produced outside a country but sold within its borders

Exports

Goods and services produced domestically for sale abroad

Balance of Trade

The difference between the value of a nation’s export goods and the value of its imports of goods

Import Quota

A restriction imposed on the value or number of units of a particular good that can be brought into a country.

Tariffs

Taxes on imports

SCOTUS Supreme Court Decision

Supreme Court ruling that made it so that states could not remove Trump from the ballots over his actions leading up to the January 6th attack on the Capital; overturned the Colorado Supreme Court decision

Who is the current chairman of the FED?

Jerome Powell

What is the current unemployment rate?

3.7%

What is the current inflation rate?

3%

What is the U.S debt right now?

$34.5 Trillion

What is the U.S income tax system?

Graduated Income Tax System

How long can you be on welfare in the U.S?

5 years total, 2 years consecutively

Who founded the Environmental Protection Agency?

Founded in 1970 by the Nixon administration

What local animal is protected by the Endangered Species Act?

The spotted owl