Exam 2 Posi 2320

What are some of the reasons for these increasing tuition rates?

• shrinkage in state per-pupil appropriations

• Lavish facilities

• Administration, administration and more administrations!!

• Employee benefits

• Over-paid, under-worked professors?

NCAA v. Alston (2021) and NIL

NCAA v. Alston (2021), the Supreme Court ruled that the NCAA cannot limit education-related benefits for college athletes because it violates antitrust laws.

NIL (Names, Image, and Likeness) : NIL allows college athletes to earn money from their personal brand, such as through endorsements, social media, and sponsorship.

Paying athletes – NCAA v. House Settlement (2025)

The House v. NCAA settlement, approved on June 6, 2025, transformed college sports by allowing schools to pay athletes directly and resolving antitrust lawsuits with approximately $2.8 billion in back pay to current and former athletes.

Biden v. Nebraska (2023)

The Biden administration proposed a plan to cancel student loan debt (up to $10,000–$20,000 per borrower). States argued this was illegal and exceeded executive power.

The Court said the President does NOT have the authority under the law (the HEROES Act) to cancel that much student debt.

This used the “major questions doctrine” → big policy changes need clear approval from Congress

What is the largest source of revenue for Texas State?

What is the largest source of student aid for students attending universities?

Federal student loans are the largest source of student aid for students attending universities.

What are some of the ways in which universities attempt to control costs?

• Increasing enrollment (student quality?)

• Internet courses

• larger classes

• reduction in course offerings

• teaching assistants in classroom

• reducing in travel and hiring freezes

What is the current unemployment rate? What is the labor force participation rate? What is the difference between the two?

Unemployment: 4.3%

Labor Force: 62.5%

Unemployment rate = jobless people who WANT jobs

Participation rate = how many people are even in the job market at all

Labor Force Participation Rate in March 2020 - 63.4% (This represents about 2.2 million people who still have not come back to work)

What is the difference between a deficit and debt?

Deficit - the excess of federal expenditures over federal revenues in a given fiscal year.

Debt - the cumulative total amount of money owed due to yearly operating deficits.

What is the current debt? What is current the debt-to-GDP ratio?

Current debt: $38.8 trillion (march 2026)

Debt-to-GDP ratio: 123%

GDP = Est. $31.5 trillion (march 2026)

What are some of the dangers of a large debt?

• Limitation of choices

• Tax increases, discouraging production (reducing revenue and exasperating the problem)

• Debt and Inflation

• Negative Impact on Economic Growth

• Investor Confidence

Which country owns more US debt than any other?

• China - $683B

What is the difference between baseline budgeting and zero-based budgeting?

baseline budgeting: An accounting method where approximately 7.5 - 8% growth rate to spending is built in to the budgeting process.

Zero-based budget: Departmental budgets that are almost never reviewed as a whole.

What is Inflation?

Decline in purchasing power of a given currency over time

• Inflation rate in 2022 was the highest since 1980

What role does the OMB play in the budgetary process?

builds budget on request from agencies

How many federal programs are devoted to fighting poverty?

There are 126 overlapping federal programs

How much federal spending is devoted to fighting poverty?

$1.05 trillion a year.

[About 20% of all federal spending is devoted to anti-poverty programs (roughly 1 out of every 5 dollars).]

Is there a strong correlation between federal spending and the poverty rate?

There is not a strong direct correlation between spending and the poverty rate…. (the more federal government spend the more the poverty rate goes down)

Is the poverty rate in Texas higher or lower than the national average?

Higher than national average

U.S. poverty rate: ~11.1%

Texas poverty rate: ~14.2%

What is the definition of poverty?

U.S. Bureau of the Census puts number of poor at 11.1% (2025) of the population ($15,650 single adult, $32,150 for family of four in 2025)

What was the subject matter of the Geraldo Rivera Willowbrook documentary that the watched a part of in class?

• The Geraldo Rivera Willowbrook documentary focused on the abuse and neglect of people with disabilities at the Willowbrook State School in New York.

What is TANF? [Temporary Assistance for Needy Families]

It is a federal program that gives money to low-income families with children to help them meet basic needs.

• Introduced to address long-term dependency on welfare

• Focus on education and job training to get people back to

work

• Block grants to states with benefits and eligibility requirements determined by the states (devolution)

• 2-year limit and 5-year lifetime limit

What is mandatory spending? Be able to identify the budget items that are “mandatory.”

federal spending that is made up of budget items that cannot be controlled through the budget process, “uncontrollables”.

Ex: Social Security, Medicare, Interest on the Debt

What is the difference between mandatory and discretionary spending?

Mandatory spending

• Money the government must spend by law

• Does NOT require Congress to vote on it every year

• Based on eligibility rules

Examples: Social Security, Medicare/Medicaid, SNAP (food stamps)

Discretionary spending

• Money Congress chooses and votes on each year

• Can be increased, decreased, or changed annually

Examples:Education, Military/defense, Transportation, Most government agencies

What are entitlements? Know that 2/3 of all entitlement spending goes to the elderly.

• government benefits that are dispensed to anyone who meets the criteria set forth by Congress

Examples: Social Security and age, Unemployment compensation and unemployment

What is the single largest spending item in the federal budget?

• Social security.

Social Security now accounts for 22% of the federal budget

What are some of the different proposals for reforming Social Security?

• Privatization

- Varying Schemes

- Better returns on investments

- However….transaction costs

• Immigration Reform

- Guest worker program or ‘amnesty’

• Tax Increases

- Making Social Security more progressive by raising the wage cap ($176,100 in 2025)

• Benefit Reductions

- Changing the formula on how benefits are calculated

- Increasing eligibility age (benefit reduction of 8% per one year of increased eligibility)

- Would reductions in benefits break the compact we have made with older Americans?

Does the US have the highest life expectancy rate in the world?

No.

• US Life Expectancy – 79.4 (2025)

Does the US have the lowest infant mortality rate in the world?

• No.

  The United States does not have the lowest infant mortality rate in the world.

How much does the US spend on healthcare as compared to other countries?

The U.S. spends far more on healthcare than other countries—about 17–18% of GDP compared to roughly 9–12% in other developed nations

Does the US have the highest obesity rate in the world?

• No, the U.S. does not have the highest obesity rate, but it is among the highest in the world.

What are some of the reasons why the US has such a high obesity rate?

• Cheap, high-calorie food

• Sugary drinks

• Less physical activity

• Large portion sizes

• Environment & access

• Income and inequality

• Lifestyle habits

define socialized medicine

Government ownership of healthcare facilities and staff

- Doctors, nurses, and specialists are all government employees.

define single-payer system

Specified citizens (entitlements) can access the health care system which taxpayers pay into.

Ex: Medicare and Medicaid

define out- of-pocket system.

If you do not have insurance, are covered by Medicare, Medicaid, or

the VA, you must pay out-of-pocket.

• Prior to Obamacare, approximately 16% of people in the US had to pay out-of-pocket

- Obamacare has reduced this number to around 9%

Medicare and Medicaid are examples of which?

Single-Payer System

What type of system resembled the VA?

Socialized Medicine

What percentage of people living in the US, prior to Obamacare, did not have healthcare insurance?

16% (about 50 million people)

Has this number been reduced?

Obamacare has reduced this number to around 9%

What groups are unlikely to have health insurance?

low-income individuals

part-time workers

young adults

immigrants are still more likely to be uninsured

To whom does Medicare pertain? Medicaid? Is Medicare and Medicaid an example of socialized medicine, a single-payer system, or an out-of-pocket system?

Medicare (for the elderly) - It accounts for about 15% of the federal budget.

BOTH ENACTED 1965.

Medicaid (for the poor) - It accounts for about 9% of the federal budget.

Medicare and Medicaid is an example of the Single-Payer System

Who was president when Medicare and Medicaid were enacted?

Lyndon B Johnson (LBJ)

he average recipient of Medicare has paid, on average, $100,000 in Medicare taxes, but is expected to receive an average of ___________ in benefits

$300,000

What are some of the reasons why the cost of health insurance has been increasing?