U.S.

DOMESTIC
POLICY
FISCAL POLICY
• This is the government's use of
taxing, monetary, and spending
powers to manipulate the
economy
• It is used to counteract the
business cycle
• The government might use it to
stimulate the economy
• Or to counter inflation

This Photo by Unknown author is licensed under CC BY

TAXATION
• In the 1800's, most of the government's
revenue came from tariff s, taxes on
imported goods

• Today most revenue comes from

income taxes

• The income tax system is progressive,

those with upper income brackets are
hit more heavily
• This contrasts with more regressive
taxes like Social Security, which
burdens low-income brackets more
heavily
• The purpose of the progressive
income tax is to raise revenue
• It rewards investment by allowing
deductions of business expenditures
FEDERAL
REVENUE BY
TAX
SPENDING
AND
BUDGETING
• Every year the government must set
a budget, in most recent years we
have been in a deficit
• Over time, the deficit adds to the
national debt
• The government will often use
subsidies to support certain economic
sectors
• Both the President and the Congress
are involved in budgeting, with the
Offi ce of Management and Budget
(OMB) and Congressional Budget
Offi ce (CBO)
MONETAR
Y POLICY
• These are efforts to regulate the economy
through the manipulation of the supply of
money and credit

• Our most powerful institution in is the Federal

Reserve
• The Federal Reserve System is a system of
12 Federal Reserve banks that facilitate
the exchange of cash, checks, and credit;
regulates member banks, and uses
monetary policy to fight inflation
• Every national bank must be a member of
this system
• The Federal Reserve Board comprises
seven members appointed by the
president
REGULATION AND
ANTITRUST POLICY
• Antitrust policy is the government's efforts to regulate large
businesses that have established monopolies in the market
 A monopoly is a single firm in a market that controls all of the
good and services of that market leaving an absence of
competition
• Economic regulation has increased in the 20th century, even
though deregulation began to gain popularity under Republican
presidents like Reagan and Bush
SHOULD THE GOVERNMENT
INTERVENE IN THE ECONOMY?

• Until 1929, most Americans believed the

government should do little to manage the
economy, laissez faire capitalism
• The Great Depression altered public opinion
 President Roosevelt supported action by the
federal government to increase regulation to
combat the Great Depression: the New Deal
program
KEYNESIAN
ECONOMICS
Named after John Maynard Keynes

Keynesians argue the government can

stimulate the economy by increasing
public spending or cutting taxes

The government stimulated demand; this

creates increased production and pulls
the economy out of recession

Keynesian economics is the basis of

Roosevelt's New Deal
THE NEW DEAL
• During the Depression, unemployment was
staggering
• Toledo, Ohio: 80%
 Lowell, Massachusetts: 90%
• Tennessee Valley Authority (TVA)
• Federal government-built dams along the
Tennessee River controlling flooding and
generating hydroelectric power (also creating
jobs)
• Glass Steagall Act
• Offers protection to those who entrust their
savings in commercial banks
 Bankers cannot use your money to pursue high
risk investments
• Works Progress Administration
• Provided jobs to those who were unemployed
SOCIAL
SECURITY
DEMOCRATS LOVE
KEYNES
• Truman's Fair Deal
 All Americans should have access to health insurance
 the minimum wage should be increased
 outlaw racial and religious discrimination in hiring
• Kennedy's New Frontier
• Establish a volunteer peace corps to assist underdeveloped
countries
• raise the minimum wage and broaden its coverage
• raise Social Security benefits
• provide Medicare
• provide federal aid to education
• give greater power to the government to intervene in the
economy,
• fund space travel
THE GREAT
SOCIETY AND
LBJ'S "WAR ON
POVERTY"
• Economic Opportunity Act
• Job Corps
• Continues to help 70,000 people find jobs
today
• Head Start
• Food Stamp Act of 1964

• Elementary and Secondary Education Act of

1964
• Funded primary and secondary education
• Social Security Act of 1965
 Created Medicare and Medicaid
• Civil Rights Act of 1964
 Created open opportunities for all
Americans, regardless of race
Medicare (federal
health insurance)
• Paid for by payroll taxes
• Same program
nationwide
• Benefits people over 65
• Participants pay
deductibles for coverage Shared
• Benefits those
with disabilities
• Prescription drug
coverages
• Outpatient
hospital care
Medicaid (federal
and state • Inpatient hospital
assistance)
• Paid for by federal, state,
and local taxes
care
• Program differs by state
• Benefits people with low
income
• Participants pay little to
no coverage
• Participants receive
regular dental and vision
exams
ECONOMIC
GLOBALIZATION
• Keynesian economics is the more liberal view of
economic globalization because it focuses more on
government spending

• In the 1970s, the US suffers from "stagflation:

 Inflation + high levels of unemployment
 Nixon tries to wage price controls to deal with inflation
 The US and Great Britain begin to move towards an
embrace of the free market
• The end stages of global acceptance of Keynes comes
with the Arab oil embargo
• Keynesian economic seemed to contribute to the
extreme rise in gasoline prices
SUPPLY SIDE
ECONOMICS
• As the public begins to
distrust Keynesian
economics, Republicans
move towards supply side, a
theory of Friedrich Hayek
• Too much government
spending would destroy
individual freedom
•Reaganomics
•Trickle Down Economics
 The parties have long battled
over government spending
• Republicans argue the government
SPENDIN is too big and spending has become

G V. too excessive
• Democrats argue the government

REGULATI helps supply important support to

citizens
Spending cuts pollmore
wellinuntil
ON • Democrats
people
remain
are that
regulation asked about
Republicans
favor of

specific programs
• Neither party supports cuts to large
popular programs
THE WELFARE
STATE:
CONTRIBUTORY
PROGRAMS
• The collection of policies a
nation must promote and
protect the economic and
social well-being of citizens
• Contributory programs: social
programs financed in whole or
in part by taxation or other
mandatory contributions by
their present or future
recipients
 Social security
 Medicare
 Unemployment insurance
THE WELFARE STATE:
NONCONTRIBUTORY PROGRAMS

• Social programs that aid people based on demonstrated need rather

than any contribution they have made
 Medicaid: a federally and state financed, state opted program
providing medical services to low income people – the largest of its
kind
 Supplemental Security Income (SSI) provides uniform benefits for
elderly, blind and disabled people
 Temporary Aid to Need Families (TANF) provides assistance to
families with children
 Supplemental Nutrition Assistance Program (SNAP) is the largest
antipoverty program, which provides money for groceries
 These programs provide "in kind benefits" - noncash goods and
services
THE
WELFARE
STATE
• Programs such as Medicaid, the ACA
and SS have led to a decline in poverty
 Individuals who have health care are less
likely to be sick and more likely to go to work
 The less money individuals spend on health
care and medication, the more they have to
invest economically
 Those who have Medicaid are hospitalized 8-
13% less than those with no insurance at all

• In 2011, SS kept the largest number of

Americans out of poverty than any
other welfare program
• 16 million of whom were senior citizens
EXPLORING INCOME
INEQUALITY
• In the US alone, the top 10% of Americans make 9x as
much money as the bottom 90%
 The top 10% of earners continue to see their
wealth grow drastically
 The top 0.1% saw their incomes rise 7.5x since the
1970's
• The net worth of the world's 358 wealthiest people is
equal to the combined income of the poorest 45%
• This would mean that 358 people have the same
wealth as 2.3 billion combined
• Middle class families continue to fall beyond the
poverty line
• As technology increases productivity, this will lead
to many industrial workers trying to find new jobs
INCOME
INEQUALITY
GLOBALLY
• In comparison to other
western nations, it is the
most difficult to rise out of
poverty if you are born into
it
• Inequality in the UK and the
USA, the poorest part of the
population are poorer than
in almost any other
developed country (Pieterse,
2002)
US TAX SYSTEM
+ INCOME
INEQUALITY
• Most of our current tax systems ask the most
from those with the least to offer
 If we want the national debt to remain
stable, taxes would have to increase by
11% ($1,300 per household)
 If we want the national debt to decrease,
we would have to raise taxes by 17%
($2,000 per household)
• The Trump Administration tax cuts show the
US will see rising deficits and a debt that is
152% larger than our GDP
 Corporate tax breaks are expected to
increase the national deficit by $2.3 trillion
 While most of us will see our tax rate
increase, many large corporations will see
their tax rate decrease
• ▪
[Link]
MINIMUM
WAGE
• Minimum wage rates have not risen with inflation
over the past several decades

• Anyone working full time on minimum wage is not

expected to exceed the poverty line

• In the 1960's, a minimum wage job was expected

to support a family of three
 If minimum wage rose with inflation the same
way it did in the 1960's, minimum wage would
be at $10.10
• This would raise the minimum wage of
27.8 million workers, resulting in a GDP of
$22 billion and 85,000 new jobs (Cooper,
2013)
 Voters in many states are supporting a $15
minimum wage
EDUCATIO
N POLICY
• Handled mostly by state and local
governments, but the federal government
began to take a larger role in education
after World War II
 GI Rights Bill of 1944
 Provided World War II vets with funds for college,
unemployment insurance and housing
 National Defense Education Act of 1958
 Provided funding to improve schools and promote college
education
• National security need: competing with the Soviet Union
in math and science
 Elementary and Secondary Education
Act of 1965
 Funds professional development, instructional materials,
resources to support programs and the promotion of
parental involvement
EDUCATION
IN RECENT
YEARS
• 2001's No Child Left Behind (NCLB) marked
a major shift in federal involvement in K-12
education
• Combined the goals of higher standards
and equality of opportunity
• Aimed to improve standards through
stronger federal requirements for
student testing and accountability
• Ultimately generated significant
controversy among teachers and states
EDUCATION
UNDER
PRESIDENT
OBAMA
• Education became decentralized
towards states
 Waivers for the NCLB Act came with
conditions
 A bipartisan bill, the Every Child
Succeeds Act, ultimately replaced
NCLB
• The Obama Administration was a strong
proponent of charter schools, publicly
funded schools that are free from many
of the rules and regulations of the
school district
 Support for charter schools
continued under Trump
 Chart
Public
er

PUBLIC
Schoo Funded by a
Funded by Schoo combination
l
public l of public and
dollars private
dollars

V
May be
Must
selective
educate all
about
students in
students
service area
populations

CHART Students live

in
neighborhoo
d
Students can
either apply
directly or
enter lottery

ER
to attend
Bound by
teacher May create
union, state its own
regulations hiring critera

SCHOO
for hiring
Accountable
Accountable
to its own
to school
governing
board

L
body

School day,
School day,
curriculum
curriculum
can be set
set by state
by school
TEACHER
EXODUS
HIGHER EDUCATION
• Most higher education has been funded by the
states, but some federal programs have made a
difference
• The GI Bill of 1944 put higher education in reach of
a whole generation of World War II veterans
• In 1972 Congress created the Pell Grants, which
offers grants directly to low income students
• States have reduced funding for higher education
since the 1970s, Pell grants have not increased to
match inflation, and the growing costs of higher
education threaten to put college out of reach for
many low income students
HEALTH
POLICIES
• The US Public Health Service
has been in existence since
1798, but it only plated a small
part in public health policy until
the mid 20th century
• Headed by the US surgeon
general
• Includes the National
Institutes of Health (NIH) and
Centers for Disease Control
and Prevention (CDC)
HISTORY OF HEALTH CARE
IN AMERICA

1912 1949 1970s 1990s

Theodore Roosevelt was Harry Truman wanted to Richard Nixon proposed a Bill Clinton appoints
the first major political make a national health health care system based Hillary to head a task
leaers to suggest care system part of his on employer mandate force to pass federal
universal health care "Fair Deal" program health care – the Clintons
are also thwarted by
lobbying groups
Franklin Roosevelt tried,
and failed to create a Lyndon Johnson passes Gerald Ford and Jimmy
national health care system Medicaid and Medicare as Carter attempted to pass
to go along with Social part of his "Great Society" reform but where thwarted
Security program by lobbying groups

1935 1964 1970s

THE AFFORDABLE CARE
ACT "OBAMACARE"
• Enacted in 2010
 Created new state based insurance exchanges and
regulations prohibiting insurers from denying coverage
 Individual mandates require individuals to purchase
health insurance or risk paying a fine
 This was later repealed by Congress
 Government subsidies; expansion of Medicaid and the
Children's Health Insurance Program (CHIP)
 Designed to help uninsured, small businesses and low
income families purchase health insurance
HEALTH
INSURANCE
COVERAGE,
1972-2018
• The percentage of
Americans without
health insurance
reached 17.7% in 2010
when the ACA was
enacted
• In 2014, the uninsured
fell to 10%
CRIMINAL
JUSTICE
• Currently, ¼ of the world's prison
population resides just in the
United States
• The US has less than 5% of the
global population
• The US spends $80 billion annually
to maintain prisoners who are
racially disproportionate
• For every white person arrested,
10 African Americans will be
arrested for the same crime
• It costs the US $20,000 - $50,000
for local, state, or federal
governments to keep one person
behind bars
GROWING
PRISON
POPULATION
• In addition to many other
things, a criminal record can
be a cause and/or a
consequence of poverty
• It is estimated that Americans
who were denied opportunities
due to their criminal
backgrounds were able to find
employment, and receive
assistance the poverty rate
would decline by 20%
THE WAR ON DRUGS

1971 1990–2000
Nixon Administration refers to drug abuse as a public The US Department of Justice reports
enemy • •The increasing number of drug offenses accounted for 27% of the
total growth among black inmates, 7% of the total growth among
Hispanic inmates and 15% of the growth among white inmates.”

Conservative drug policy continued and strengthened

by the Reagan administration
• Crime arrests rose 28%
• Drug arrests rose 126%
• Privatization of the prison industry

1980s
GUN CONTROL
LEGISLATION
• The National Firearms Act of 1934 prevented Americans from
owning machine guns

• The Gun Control Act of 1968 established a federal system to

license gun distributors
• Created three categories for firearms: handguns, sporting
weapons, and semi automatic
• The Gun Control Act of 1986 established laws governing who
was able to obtain weapons

• The Brady Bill of 1993 established a five day waiting period

before gun purchases could be completed
• Federal system of executing background checks
• With the Heller decision, more Americans own individual
firearms
GUN
CONTROL
• The recent mass shootings in
the US have brought renewed
attention to gun violence
• More Americans died of gun
related injuries in 2020 than in
any other year on record
• Current data on gun deaths does
not reflect a growing population
 2017: 12 deaths per 100,000
people
 1974: 16.3 deaths per 100,000
people
GUN DEATHS
PER STATE
• The rate of fatalities vary from state to state
• Mississippi (28.6 per 100,000), Louisiana
(26.3), Wyoming (25.9), Missouri (23.9), and
Alabama (23.6) have seen the highest rate
of death and tend to be places with looser
gun restrictions
• States with tighter gun restrictions: New York
(5.3), Rhode Island (5.1), New Jersey (5.0),
Massachusetts (3.7), and Hawaii (3.4) have
seen the lowest numbers in gun related
deaths
GUN RELATED DEATH
COMPARED GLOBALLY
[Link]
aps/mass-shootings-in-america/
THE
ENVIRONMENTALIST
MOVEMENT
• The early 20th century progressive movement
sought to push land conservation through the
protection of public lands and national parks
• Theodore Roosevelt led the environmental
movement in the US as President
• Roosevelt creates 150 national forests, 51 federal bird
reserves, 4 national game preserves, 5 national parks, 18
national monuments on over 230 million acres of public
land
• The US and the rest of the industrialized world
were still not concerned with the environmental
effects of industrialization
“I want to ask you to keep this great
wonder of nature as it now is. I hope you
will not have a building of any kind, not
a summer cottage, a hotel or anything
else, to mar the wonderful grandeur, the
sublimity, the great loneliness and
beauty of the canyon. Leave it as it is.
You cannot improve on it. The ages have
been at work on it, and man can only
mar it. What you can do is to keep it for
your children, your children’s children,
and for all who come after you, as one of
the great sights which every American if
he can travel at all should see.”
- Speech by Theodore Roosevelt at the
Grand Canyon, May 6, 1903
SILENT
SPRING
• Rachel Carson's book points
out that human actions were
not only harming the
environment, but people
themselves
• She describes the impact
pesticides have on birds and
other animals
• Her book sets off national
protest in the 1970s
EARTH DAY
• President Nixon supported
environmental reforms by establishing
Earth Day in 1970
• Nixon also creates the Environmental
Protection Agency (EPA) which seeks to
limit or eliminate pollutants that risk
the public's health
• Nixon Administration also oversees the
creation of the Clean Air Act, the Clean
Water Act, and the Endangered Species
Act
CLIMATE
CHANGE
• The current global warming trend is the direct
result of human activity and it is growing at an
unprecedented rate

• An increased level of greenhouse gases has

caused the Earth to warm in response

• The planet's average surface temperature has

risen 1.62 degrees since the late nineteenth
century
 Most of this warming has occurred in the past
35 years
WHY IS THE EARTH
GETTING WARMER?
Causes Effects
• Human activities change the natural • The Earth will continue to become
greenhouse gases of the earth warmer which will lead to evaporation
• This includes burning fossil fuels like and precipitation
coal and oil • Some places will become dryer while
• Clearing of land for agriculture, others will become wetter
industry and other human activity has • A strong greenhouse effect will warm
also led to an increased concentration the oceans and partially melt glaciers
of greenhouse gases and other ice
• Ocean water will expand and lead to
a rise in sea level
PARIS CLIMATE
AGREEMENT
• The United States is currently a member of the
Paris Climate Agreement whose goal is to
strengthen the global response to climate change
by keeping global temperatures below 2 degree
Celsius

• The PCA also vows to the strengthen the ability of

countries to deal with the impacts of climate
change

• Appropriate financial flows

• New technology framework
• Support developing and vulnerable countries
IMMIGRATION TO THE US

• 1921: The National Origins Act gave countries an immigration

quota in response to the growing number of immigrants
coming from eastern Europe

• 1960s: National Origins Act is replaced by a preference

system to unite immigrant families and attract skilled
workers to the United States
• Most applicants for the first time in US history came from
Asia and Latin America, not Europe
 The number of immigrants in the US triples during this
period
• 1986: The Immigration Reform and Control Act provided
amnesty to aliens who had resided in the US since 1982,
granting legal status to 3 million people

• 1990: the Immigration Act of 1990 increased the total level of

immigration to 700,000 and increased available visas by 40%
• Family reunification became the major entry path
• More immigrants from under represented countries began
coming to the United States
MODERN VIEWS ON
IMMIGRATION
• The Trump Administration put immigration
issues at the forefront
• 2017:
 Travel ban which restricted admissions
of citizens from Libya, Iran, Somalia,
Syria, Yemen, North Korea and Venezuela
 Rescinded Obama's DAPA "Deferred
Action for Parents of Americans" which
granted three year renewable work
permits and exemption from deportation
to illegal aliens whose children are
American citizens
 •Economics

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(2013). Legacies of the War on
Poverty. Russell Sage Foundation.

OUT ANY Retrieved from

[Link]
u/stable/10.7758/9781610448147

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Nature of Political Economy. In The

RESEARCH
Political Economy of International
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FOR
[Link]
ct3.6

YOURSELF!
•Rodrick, Dani. (2011) The
Globalization Paradox. Democracy
and the Future of the World
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 •Criminal Justice

CHECK ••Chin, G., Collins, T. (1995). A War on Drugs

or a War on Immigrants? Expanding the
Definition of ‘Drug Traffi cking’ in Determining

OUT ANY
Aggravated Felon Status for Non-Citizens.
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•Heuvel, K. (2014). The moral and political

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case for reforming the criminal justice system.
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minal-justice-reform/2014/11/17/3eedc60c-6e
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 Health Care

•Ball, M. (2012). Was Mitt Romney a Good Governor?. The Atlantic. Retrieved

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governor/257942/

•Bernstein, C. (2008). A Woman in Charge (1 st ed.). New York: Vintage Books.

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OUT ANY
•Clinton, Hillary R. (2005). Living History (1 st ed.). Melbourne: Vision
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