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31 Cards in this Set

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"Baby boomers"
Americans born between 1945 and 1957, an unusually large generation due to the fact that many were born after WWII soldiers returned from war.
Budget Deficit
The annual shortfall between revenues taken in and expenditures, created by borrowing in order to fund projects. In other words, deficit = Tax Revenue < Govt. Spending.
Capital gains tax
Tax on unearned income from rents, stocks, and interest; seen as an example of progressive tax because most of the revenue it gathers comes from a tiny portion of the wealthiest Americans.
Demographic Diversity
Nationally, America is very demographically diverse with regards to race. The majority race is still white, with 72% of the population. Within states, there is less diversity, with a usually higher percentage of white people. However, CA is one of three states without a majority race, with 49.9% white and 32% Hispanic.
Demographic time bombs
The years in which entitlement programs, specifically as Social Security and Medicare, will run out of funds and therefore cease to exist if they continue to follow current funding patterns. For Social Security, this year is 2041; for Medicare, 2020.
Direct democracy
– The ability of the people to make legislation. Although it does not exist at the national level, it does to some extent on the state level. It also increases accountability and responsiveness of government, but increases demands on the public to be informed and to exercise sound judgment. Ex: recall, referendum, initiative.
Entitlements
Non-discretionary govt. spending that provides benefits to individuals who qualify. The government has no choice but to fund these programs.
Excise Taxes
Taxes on the sale or manufacture of products such as cigarettes, alcohol, and gasoline. Clinton’s tax strategy involved greater emphasis on these taxes, even though they were traditionally a small part of the revenue.
Fiscal Policy
– Government policy which has the clearest effect on the economy through its budget-related decisions. Government budgetary choices concerning when and how much to tax, spend, subsidize, and borrow affect the economic lives of all citizens.
GDP
Gross Domestic Product: Measure of a nation’s total productivity. Used to measure whether the economy is growing or falling; often a large source of federal government’s money.
Geographic Diversity
Nationally, America is very geographically diverse, with deserts, forests, coasts, plains, etc. Geographic diversity makes for economic diversity, as there are many different ways to make a living based on one’s geography. However, again there is less diversity within states, with makes for less economic diversity and therefore less political conflict. Once again, CA has the same extensive geographical diversity as America as a whole, which creates economic diversity and conflicting political interests.
Impoundment
The president’s refusal to spend appropriated funds, or his deferral of such expenditures.
Initiative
– Citizen-authored legislation, allowed in 24 states, in which a petition puts a measure on the ballot, where people then vote for it. Non-existent at federal level.
Means testing
– The changing of eligibility for entitlement benefits from everyone receiving benefits to only those who are “truly disadvantaged,” or whose earnings and savings are below a predetermined level, in attempt to save money. Congress has made attempts to apply means testing to Social Security, but none have been successful.
Medicaid
Entitlement program which provides health-care coverage for needy people under age 65.
Medicare
Entitlement program which provides basic health-care and hospitalization coverage for people over age 65.
Monetary Policy
The range of actions taken by the Federal Reserve Board to influence the level of GDP or the rate of inflation. In an open economy, monetary policy affects the level of imports.
National Debt
Cumulative unpaid total of all budget deficits.
Plural Executive
Similar to the president’s cabinet, this office acts as a check and balance on the state governor within his own branch. In CA, there are eight offices elected by popular vote.
Proposition 140
1990 Proposition that imposed term limits in California. In the assembly, a term is 2 years with a 3 term limit; in the senate a term is 4 years with a 2 term limit.
Recall
– The ability of the people to remove an elected official before his term is up. 21 states allow recall of all state officials, and although it is rare, when it happens it is through a petition process. Does not exist at national level.
Referendum
‘Citizen’s veto’ of legislation; allowed in 24 states by petition process. Three types are: compulsory (bonds, constitutional amendments – required), petition (challenges a bill that has already been passed), and advisory (most common at local level; non-binding, merely asks for advise in order to measure public opinion, but govt. is not bound by it.)
Regressive Taxes
System of taxation in which all people pay the same amount, thereby taking a higher fraction of the income of lower income taxpayers. Examples: tax on gasoline, cigarettes, and alcohol.
Progressive Taxes
System of taxation in which those who make more money are taxed at a higher rate; often considered the fairest because they put a lager burden on those with the greatest ability to pay. Example: income taxes.
Social Security
Entitlement program which pays retiree benefits with a “pay as you go” system.
Surplus
An excess of money. For example, Social Security currently has a surplus of funds due to the large population of baby boomers paying into the system.
Term limits
A restriction on how many terms a legislator can serve. In the US Congress, there are no term limits, but 23 states impose limits on their state legislators.
Triggering Mechanism
A critical development that converts a routine problem into a widely shared, negative public response; for example, it can turn a problem into a condition in the minds of the American people and political leaders.
War on Poverty
A movement started by Lyndon Johnson which included the Economic Opportunity Act and the Medicare Act, aimed at employing Americans in order to reduce poverty. It was during this time that many entitlement programs were created.
Welfare State
Entitlement program, such as AFDC, where the government assumes primary responsibility for the welfare of its citizens.
Workfare
Programs that assisted welfare recipients in making the transition into the workforce. Also, it required that they work on public works projects unless they were employed elsewhere.