POLS 101 Lecture 18: 12-01 Lecture Notes

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School
Course
Professor
Domestic Policy
Social Policy
oExpands during wars, economic hardships
oWars
American Revolution – state assistance for displaced
Civil War – national pensions and state welfare payments
WWII – GI Bill (1944) national subsidies for college, home
mortgages
oEconomic hardship
Great Depression / New Deal
o3 LARGEST Social Programs:
Social Security (1935) – federal, funded by payroll tax, part of
FDR’s New Deal
Unemployment Benefits – federal and state
Medicare (1965) – federal, funded by payroll tax, part of LBJ’s
Great Society
Medicaid (1965) – federal and state; not funded by payroll, but by
general revenue
Means-tested program – Have to be below certain (133%
of) poverty line
Fiscal Policy
oReliance on Big Government
Once programs begin, they are difficult to stop or change:
Institutionalized
Incrementalism
“Third Rail” – Social Security & Medicine (don’t mess with these)
oDeficit – spending > revenue
Currently ~$900 billion or 5.5% of GDP
Three reasons for high deficit
3 entitlement programs
T.S. conflicts in Iraq, Afghanistan
2001 tax cuts  federal revenue decline
oDebt – accumulated annual deficits
How a Budget is Passed
1. President creates a budget, as the Chief Bureaucrat
2. President submits the budget to Congress
3. Congressional Budget Committees edits, finalized budget
4. Congress votes on the final budget
5. Goes to Appropriation Committee - votes
6. Final copy goes to President for approval
7. Implementation & execution
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Document Summary

Domestic policy: social policy, expands during wars, economic hardships, wars. American revolution state assistance for displaced. Civil war national pensions and state welfare payments. Wwii gi bill (1944) national subsidies for college, home mortgages: economic hardship. Great depression / new deal: 3 largest social programs: Social security (1935) federal, funded by payroll tax, part of. Fdr"s new deal: unemployment benefits federal and state. Medicare (1965) federal, funded by payroll tax, part of lbj"s. Medicaid (1965) federal and state; not funded by payroll, but by: means-tested program have to be below certain (133% of) poverty line, fiscal policy, reliance on big government. Once programs begin, they are difficult to stop or change: Third rail social security & medicine (don"t mess with these: deficit spending > revenue. Currently ~ billion or 5. 5% of gdp. 3 entitlement programs: t. s. conflicts in iraq, afghanistan. 2001 tax cuts federal revenue decline: debt accumulated annual deficits.

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