Transcript Chapter 5 - Algonac Community Schools

Bell Work:
 Do you think politicians can fix any of the issues we discussed
yesterday? Will they?
Parties and What They Do:
5.1
What is a Party?
 A political party is a group of people who seek to control
the government through the winning of elections and the
holding of public office.
 2 major parties in American politics are the Republicans and
the Democrats.
What Political Parties Do?
 Nominate Candidates- Major function of political parties.
 Informing and activating supporters- Informs the
public on issues, and encourages them to participate in public
affairs.
 Bonding agent function- To ensure good performance of
its candidates and office holders, political parties choose
people who are considered to be most qualified.
 Governing- In many ways the government in the U.S. is
government by party.



Those who govern are regularly chosen on the basis of their
party.
Congress and state legislatures conduct much of their business
based on partisanship.
Partisanship means a firm allegiance to a political party.
 Acting as a watchdog-Parties act as a watchdog over the
conduct of the public’s business. (very true for parties out of
power)
 A party that is in power controls the executive branch (means the
president belongs to their political party).
 A party out of power criticizes the policies and behavior or the
party currently in power.
Bell Work:
 What is a political party and what is their major function?
The Two-Party System:
5.2
The Two-Party System:
 As mentioned in the previous section, the two major political
parties in the U.S. are the Republicans and Democrats.
 Because of this, it is said that the U.S. has a two-party
system.
 In fact, in a typical election, only the Republican or the
Democratic candidates have a reasonable chance of winning
public office.
Why A Two-Party System? :
 Several factors help to explain why the U.S. has had, and
continues to have a two-party system.
- Historical Basis
- Tradition
- Electoral System
-American Ideological Consensus
The Historical Basis:
 The two-party system is rooted in the beginnings of the
nation itself.
 Framers were opposed to political parties, and made no
provisions for them in the Constitution.
 However, ratification of the Constitution saw the birth of
America’s first two political parties.
-The Federalist and Anti-federalist
The Force of Tradition:
 Most Americans accept the idea of a two-party system simply
because that is the way it has always been.
 This type of thinking has prevented minor parties from ever
gaining any real strength in the American political system.
The Electoral System:
 Several features of the American electoral system tend to
promote the existence of only two major parties.
- single-member districts: contest in which only one candidate
is elected to each office. The candidate who receives
plurality, or the largest number of votes wins.
* people can vote Republican, Democrat, or waste their vote
on a minor party candidate
- election law: is purposely written to discourage non-major
party candidates.
* In most States, it is very difficult for minor parties to get
their candidate on the ballot.
- Ralph Nader only in 34 states (2004)
* Only 7 times in history have minor party candidates been
on the ballot of all the States
- Republican and Democrats regularly act in a bipartisan way
to shape these election laws.
The American Ideological Consensus:
 The U.S. is a pluralistic society, meaning it consist of
several distinct cultures and groups.
 However, over time the American people have shared many
of the same ideals, principles, and pattern of belief.
* recall the basic concepts of democracy:
- worth of the individual
- equality of all
- majority rule, minority rights
 The ideological consensus has also given the nation two
major parties that look very much alike.
- moderate (middle of the road)
- built on compromise
-seek the same prize (votes/election wins)
- policy positions
 Although similar, there are also significant differences
between the parties and the people who vote for them.
Democrats and the people who vote
for democrats…
Republicans and the people who vote
for republicans…
Support social welfare programs.
Favor market forces in the economy
Government regulation of business
practices.
Deregulation of businesses
Efforts to improve the status of minorities
Feel that the Federal Government should be
less extensively involved in social welfare
programs.
So… what party do you belong to?
Multiparty Systems:
 Some critics say that the American two-party system should
be scrapped.
 They would replace it with a multiparty system, in which
several major and smaller parties exist, compete for, and win
public offices.
- has been used in European democracies and are now found
in many other democratic societies.
 Those who favor this system claim it gives voters a more
meaningful choice among candidates and policy alternatives.
 A negative of the multiparty system is that it can lead to an
unstable government, because one party is unable to win a
majority of the voters.
 As a result, the power to govern must be shared by a number
of parties in a coalition.
 A coalition is a temporary alliance of several groups to
form a working majority in order to run a government.
 Historically, the Americans have shunned a multiparty
system.
One-Party System:
 Basically amounts to a “no-party” system.
 Found in dictatorships
Modified One-Party Systems:
 Can be found in the U.S.
-when Republicans or Democrats regularly win election in a
given state.
(ex:) Texas = republican
Party Membership Patterns:
 Membership in a political party in voluntary.
 Certain segments of the American population tend to be
aligned with one of the major parties.
- African Americans, Catholics, Jews, lower income groups,
and union members more often vote for Democrats.
-White males, protestants, higher income groups, and the
business community have been inclined to vote Republican.
 Family plays the biggest role in how a person votes, and what
political party they belong to.
Bell Work:
 What are the five things that political parties do? (5.1 notes)
1.
2.
3.
4.
5.
Fiscal and Stabilization Policies:
Chp. 5 (econ)
Business Cycle:
 Business fluctuations: The ups and downs in the
national economy.
 Business cycle: Irregular changes in the level of total
output measured by GDP.
Business Cycle:
GDP and Employment is at
its highest point
Peak
Decreasing GDP and
increasing
unemployment
Rising GDP
Increasing
employment
GDP is at its lowest
point
Unemployment
is at
its highest point
Trough
Unemployment:
 As you saw in the business cycle, during the contraction and
trough phase, the unemployment rate is high.
 Unemployment rate: the percentage of the civilian labor force
that is without a job, but actively looking for work.
 Full employment: When the unemployment rate is around 5%,
the country is said to be at full employment.
4 Types of Unemployment:
1. Cyclical
- Unemployment associated with the fluctuations (ups and
downs) in the business cycle
- Directly related to recessions or depressions
- Examples: Economy is declining, people buy less
CARS
__________________,
so John Q who works at
__________________
loses their job.
FORD
2. Structural:
- Unemployment caused by changes in the economy, such as
technological advances or discoveries of natural resources.
-Ex: Auto worker losing their jobs to robotics
3. Seasonal
- Unemployment caused by changes in the seasons or weather.
- Ex: Farmers, construction workers
4. Frictional
- Temporary unemployment caused because of being fired, laid
off, or a voluntary search for a new job.
- Ex: Due to budget cuts, a person laid off.
Fiscal Policy and Stabilization:
 Fiscal policy: refers to the federal government’s deliberate
use of taxing and spending to affect overall business
activity.
 John Maynard Keynes developed the theory of fiscal
policy during the Great Depression.
- He believed that the self regulating nature of supply and
demand would occur too slowly in a period of economic
recession.
- Instead, Keynes suggested that the government
should intervene.
 To understand the Keynesian theory (Fiscal Policy), you
must first examine the circular flow of income.
Federal
Government
Consumers
Firms
Banks
Leakage and Injection:
 You will note that in this chart, there are both inputs and
outputs coming from the federal government.
 Money being removed from the circular flow is known as
a leakage.
 Money being put into the flow is known as an injection.
 EXAMPLES:
1. Government caused leakage:
- Charging a higher rate of taxes on the citizen
2. Government caused injection
- Lowering Taxes on a business
- Buying supplies from manufacturers for war
- Starting government programs to create jobs.
Fiscal Policy and Unemployment
 Democrats: suggest starting job programs (injection) to reduce
unemployment and stimulate the economy.
 Republicans: argue that tax cuts, usually to the wealthy, lead
to more work, saving, and investment. (injection)
-This is called the supply-side effect was used by George Bush
in 2003 as way to stimulate the economy.
-(also known as trickle down economics)
Bell Work:
 What is the difference between leakage and injection?
Minor Parties:
5.4
Minor Parties:
 Minor Parties: A party within a two-party system
that is less widely supported than the two major parties.
Types of Minor Parties:
1. Ideological Party
A party based on a set of beliefs on how social, economic,
and political matters should be implemented.
(Examples:) Socialist, Communist, and Libertarian Parties
2. Single-Issue Parties
 A party based on a single public policy matter
 Their names usually indicate their primary concern.
 Most of these parties die off after a period of time.
(Examples:) Free Soil, Know Nothings, Right-to-Life, and most
recently the Green Party.
3. Economic Reform Parties
 A party that focuses primarily on the reorganization of the
economic system.
 These parties proclaim their disgust with the two major parties,
and demand better times.
 Usually focus their anger on things like the monetary system, or
foreign imports.
 These types of parties usually appear and disappear based on the
changes in the business cycle.
(Examples:) Greenback Party, Populist Party.
4. Splinter Parties
 A party that breaks away from one of the major parties.
(Example:) Progressive Party (“Bull-Moose Party”)
 Most splinter parties form around a very strong
personality(T.R. & Bull-Moose Party.)
 They tend to be the most successful of the minor parties, but
usually dissolve quickly.
Key Roles of Minor Parties
Minor parties have 2 key roles in the American political
system.
1. Spoiler Role
 Most “3rd parties” or minor parties realize that they don’t
really have a chance to win.
 The minor party tries to “steal” votes away from one of the
major parties that they do not want to win.
(Example:) Election of 1912
- T.R. & Bull-Moose Party.
Woodrow Wilson
Teddy Roosevelt
2. Critic and Innovator Role
 Minor parties will take a strong stance on an issue, or create
new issues not in the public sector.
 This strong position will bring attention to the issue at hand.
 It is not unusual for a major party to adopt a stance from a
minor party.
* If this happens, the minor party will usually dissolve.
Bell Work: 12.5.11
 Turn to pg. 140 and define the following terms.
1. Ward2. Precinct-
Inflation, Fiscal Policy, and
Monetarism:
Chapter 5 (econ)
Inflation:
 Just as unemployment can disrupt the business cycle,
inflation can have an adverse effect on the economy as
well.
 INFLATION = A general rise in the cost of good or
services
 * Most economists state that a normal rate of inflation
is 3% per year.
• If a person’s pay does not keep up with inflation, their
standard of living can be affected.
 EXAMPLE: John Q. receives a pay raise of 5%. The
inflation rate in the US economy is 8%. John Q. now pays
the 8% inflation rate, but only receives a 5% raise to
compensate for it. John Q. is now losing 3% more income
than he did the previous year.
 Inflation hurts people on fixed incomes the most.
- Fixed income = Making the same amount of money
every year
- Examples: Employees who get no raise, people
on Social Security, etc…
 How Inflation hurts them: John Q (who lives on Social
Security) paid $2.00 for a gallon of milk this year. Next
year, because of inflation, the price of milk goes up to
$2.50 per gallon. John Q’s pay stayed the same. He can
no longer afford to buy __________ because of the price
increase.
Theories on Inflation:
 There are 2 theories on the cause of inflation
1. Demand-Pull
- Theory that prices rise as the result of excessive
demand. Demand increases faster than supply, and
shortages lead to higher prices.
- Can be caused by having too much money in the
system. (Done by the Federal Reserve)
 2.
Cost-Push
- Theory that the push for higher wages by employees
causes business to raise prices to maintain a profit.
Federal
Government
Businesses
Consumers
Banks
The Theory of Monetarism:
 Monetarism: is the theory that deals with the relationship
between the amount of money the Federal Reserve places in
circulation and the level of activity in the national economy.
 Monetarism is often linked to Milton Friedman, who is a
early and leading supporter.
 People who follow this theory are called monetarists.
Government Policy According to
Monetarists:
 Monetarists believe that the economy is so complex and so
poorly understood that government actually does more harm
than good.
 As a result, monetarists usually oppose using fiscal policy to
stimulate or slow the economy.
 Also against the government operating on budget deficits.
A Monetarists View:
 On the Government: the economy is so complex and so
poorly understood that the government actually does more
harm than good.
- As a result, monetarists generally oppose using fiscal policy
to stimulate or slow the economy.
 Other criticism of fiscal policy:
1. Too many people involved, too little accountability.
2. Time lags, or the long time it takes for policies to take
effect.
 On the Federal Reserve: Stop trying to smooth the ups and
downs in the economy.
- Instead, they believe that the Fed. should follow monetary rule,
or allowing the money supply to grow at a smooth and stead rate
per year.
- This would result in controlled expansion, which would provide
businesses and consumers with more certainty about the future.