Chapters 17-21

Public Policy-Making Process The study of public policy gives a clear understanding of the impact of the following on policy processes and policy-making in the federal government: Federalism Interest groups Political parties Elections

What does policy-making mean in a federal system? 1. The national government passes laws, enacts regulations, and rules on cases. 2. Local and state governments also pass laws, enact regulation, and rule on cases. These may NOT overstep action taken by the federal government.

Legislative Branch 1. Enact Policy 2. Implement Policy Pass laws through the process outlined in the Constitution Bi-Cameral vote and presidential signature 2. Implement Policy After a law is passed, money to support new law must be appropriated Policy networks play important roles in how policy is implemented (formally iron triangles) 3. Interpret Policy Interpretation of policy by Congress is accomplished during the law-making process, especially in committee

Executive Branch 1. Enact 2. Implement 3. Interpret The Executive Branch plays a major role in the how policy is enacted. The president signs bills from Congress into law The president also makes executive agreements which do not require Congressional votes 2. Implement The 3 million bureaucrats who are part of the Executive Branch are generally in charge of implementing policy The President uses the office’s considerable power to implement favorite or approved policy through media exposure and placing it in the public’s eye The Executive Branch also guides policy implementation through creating authorizations in the annual budget 3. Interpret The Bureaus and Agencies must interpret how the new policies are carried out after passage This is the most powerful role of the Bureaucracy

Judicial Branch 1. Enact 2. Implement 3. Interpret The Judicial Branch does not make policy, but uses its power of judicial review to make changes in Congressional laws and/or Executive agreements 2. Implement The Courts have no power of their own to implement laws; instead they have to wait for the Executive branch to carry out their rulings 3. Interpret This is the most important role that the Courts have in public policy. When cases concerning public policy are presented, federal judges and SC Justices interpret whether or not it is constitutional.

ECONOMIC POLICY U.S. Economic policy generally deals with the question of how to balance capitalism with government regulations Political and business leaders disagree on how much control is enough Until the 20th century the country followed the laissez-faire policy, which required a free market without any intervention from government

Politics of Prosperity Voters see the connection between the nation as a whole and their own situations, but voting behavior and economic conditions are not always correlated. Elected officials tend to take a short-term view of the economy Government policy can’t produce all desired outcomes and often face serious economic pressure Democrats: want to reduce unemployment Republicans: want to reduce inflation

Monetarists Monetarists argue that inflation occurs when there is too much money and too few goods. They advocate increasing the money supply at rate about equal to economic growth and then allowing the free market to take over.

Keynesianism Keynesians assume the health of the economy depends on what fraction of their income people have to spend When demand is too low, the government should pump money into the economy to stimulate growth

Supply –Side Tax Cuts Supply-side proponents believe there is a need for less government interference in the market and lower taxes (would create incentive for investment) Greater economic productivity will then produce more tax revenue

Reaganomics Reaganomics is a combination of monetarism, supply-side tax cuts and domestic budget cutting Large increase in military spending Money supply controlled – cut inflation but allow interest rates to rise

Reaganomics Personal income taxes were cut, but Social Security taxes increased Large deficits dramatically increased the size of the national debt Stimulated economy – unemployment decreased, business activity increased

Federal Reserve Board Members are appointed by the president – serve a non-renewable 14 year term (can be removed) Independent of both president and congress Regulates supply and price of money Sets monetary policy (controls amount of money, bank deposits and interest rates for loans)