POLS 207 EXAM 2 STUDY GUIDE

Who said, “government is best which governs the least”?

Politics Among the States

Political culture

- Shared values, beliefs, and habits in regard to government and politics - Texas is distinct due to:  

o Great size, geographic isolation (no navigable rivers, 2nd largest area) ▪ Changed by the iron horse (railroad): social interaction

o Independent republic

o Mix of Old South and West of frontier

o Social change is difficult

- Social change is slow because people are resistant  

- African and Mexican Americans are separate from Anglo majority o Texas history and politics mold the image of political culture

What is progressive federal income tax?

Don't forget about the age old question of What is accrual accounting?

o Texas patriotism due to Texas being the best place to live Don't forget about the age old question of What is an example of psychological noise?
If you want to learn more check out Who is wayne berkeley?

- Texas Experience – Conservative  

o Southern states

o Slavery

o Civil war loss

o Postwar Northern occupation

▪ Radical reconstructionist congress – Carpet Baggers

▪ Voting Rights Act of 1965

o Refusing African American full citizenship

- Texas: half traditionalist half individualistic

o Individualistic – SMALL GOVERNMENT

▪ Minimal government

▪ Private initiative

▪ Government should protect rights

What is socialism?

▪ merit based political relationships

o Traditionalistic – SMALLEST GOVERNMENT

▪ Government should preserve tradition

▪ Social elite rule the government

▪ Low participation by ordinary people

▪ Government should protect/preserve society standards

o Moralistic – BIG GOVERNMENT

▪ Government should intervene in affairs of states

▪ Government should promote welfare and public goodDon't forget about the age old question of Why do live events cost more than recorded media?

▪ Political participation is civic duty

- Traditionalistic

- Southern states

- Arizona-Virginia

- Individualistic

- Northeast and Midwest

- Nevada-Mass.

- Moralistic

- West Coast and North

- California-Maine

Don't forget about the age old question of What are the kinds of olympic games?

We also discuss several other topics like What is ebionites?

- Voter turnout

o Decreased from ’97-’15 (moderate correlation = 0.54)

o Lowest – New York, Texas, California, Louisiana

o Highest – Montana, North Carolina, North Dakota

Purposes of Government

- (Order) Preserve life and protect property

o Est. laws to protect/preserve life and property

o Leviathan style: authoritarian – most order

- Public goods

o Not supported in TX

o Education, sanitation, lights, parks, utilities

- Equality

o Give to the poor/needy – MOST CONTROVERSIAL

o Group receiving most from affirmative action – women

▪ Education receives > welfare recipients

Role of Government

ANARCHY

no government  power

Somalia

TOTALITARIAN

unlimited  

government

Hitler, Kim Jung Un

2

SOCIALISM

equality

government owns  goods/services

CAPITALISM

efficiency, people  own  

goods/services,  Hong Kong

Capitalism: Hong Kong – poor quality of life: bunk beds, dead rivers, pollution, nanoplastic

- For: maximum economic growth, promotes individual wealth

- Against: less intellectually and socially privileged without quality life

Socialism: for – labor becomes less valuable as productivity increases / against – no incentive to  work, people become lazy

FREEDOM

value of liberties  

over orderly  

society

No absolute free or ordered country

- Freedom = bill of rights, abortion

- Order = control people’s behavior, taxing smokers Political Ideology

ORDER

value of public  stability over  liberties

3

Liberal Conservative

Economic

equality efficiency

Social

freedom order

- Liberal: civil liberties, social welfare, equality – economic regulation, little social regulation - Conservative: restrict behavior, free market, efficiency

- Small government – libertarian: social liberal, economic conservative - Big government – populist: social conservative, economic liberal

- Most societies are social conservative

- Adam Smith = free market, economic conservative

Voter Turnout

- Behavior of states hasn’t changed

o Voting rights act of ’65 aided the Northern states more

4

•order, economic  

efficiency, gov.  

regulation over  

society not  

economy

Conservative Liberal

Libertarian Populist

•social freedom,  

economic  

efficiency, minimal  

gov.,

- Texas Political Culture

o Conservatism

•social freedom,  economic equality,  gov. intervention  for these values is  supported

•gov. intervention in  economy, gov.  

regulation over  social behavior

▪ “government is best which governs the least” –Thomas Jefferson

▪ laissez-faire – resistant to government intervention in economy

▪ individualistic – economically

▪ traditionalistic – socially

o Social Darwinism

▪ The prosperous are worthy and deserving - hardworking

▪ Stingy towards the poor – lazy

▪ Does not support Affordable Care Act

• Those with health insurance live longer (fact)

• People do not want to come to the US because no free healthcare

▪ Trickle-down theory – all people are better off when business is  successful

Liberal / Conservative Data from Graphs

- Strong correlation (0.9) between Liberal vs. Conservative percentages among states

5

o Most conservative – MS, AL, LA

o Most liberal – Vermont, Mass., NY

- Majority of states cluster near % conservative

- States that were conservative in ’98-’99 are more conservative now

- Majority of states are Republican controlled in the state legislature

- Rhode Island, Hawaii, Mass., Vermont, New Jersey, and 6 others are Democrat controlled - Party Control of Legislature 2016 map shows:

o 11 Democrat states

o 8 divided states: Washington, NM, CO, MA, and NY are some

- Strong correlation between population % Republican and % state house Republican o Utah has the most republicans in the state legislature

- Party Control of Legislature and Governor map shows:

o More divided than the map showing just the legislature

o Still majority Republican

o 6 states with Democratic control

The Evolution of American Federalism

Forms of Government

- Unitary

o People have the power

o Central government is strong

o States follow wishes of central government

o Parliamentary system

- Confederacy

o State government has the power

o Articles of Confederation

o EU – but not a country

- Federalism U.S. FORM OF GOVERNMENT

o Federal government has the power

Periods of Government in America

No Government Period

1776 - 1850

County government

Low population

Self-dependence

Traditional gov. – kept records

Municipal Government Period

1850 - 1895

European immigrants → cities Urbanization

gov. services provided

corruption - ward heelers

6

State intercity Government Period

1895 - 1932

corruption → state reforms,  non-partisan elections  

secret ballots

civil service system

Dillion’s rule

Federal Government Era

1932 - 1980

Great Depression, WWII  New Deal: Keynsian Theory – create jobs, electrification of  TX, parks created by CCC federal gov. = $ and defense,  federal gov. protects elderly,  disabled, environment,  

workplace, and education,  grants are given to states role of president - imperial

New Federalism Era

1980 - 2016

Individual over institution  business over government local government makes  better decisions

federal grants

federal responsible for  

$ problems

states can choose to opt out of  federal programs

- Civil service system: merit v. loyalty

- Dillion’s rule: state law is supreme to local gov. because state government created local  government  

- $: economic

- CCC: Civilian Conservative Corps, created jobs, electrified TX

- Federal agencies: FDIC – federal depositors interest corps protected banks from bank runs  – borrowed idea from Texas, SEC – stocks exchange commission regulates stock markets

Federal Power Grows

- Domestic problems too large

o States could not expand and create debt

- International problems

- States not cooperating

o No financial resources

- Federal $ sources

o Borrows $

7

Federal Responsibilities

- National defense

- Space program

- Postal service: listed in Constitution, major spending, large deficient Shared

- Welfare – state run, federal funded

- Employment services

- Unemployment compensation – if we got rid of, for-closure % would increase STATE AND LOCAL BUDGETS

Highways and  

Transportation

Welfare of Public

Police and  

Corrections

Health and Welfare 

Fire

Education

- Pie slices not exact: sized based on largest to smallest - States and Communities deal with:

o Public business

o Majority of political conflicts

o Majority of policy decisions

o Bulk of public programs

o Domestic law/order

o Education

o Transportation

o Poor and ill care

o Water, gas, electric, utilities regulation

8

o Insurance and banking (shared)

o Property sale regulation

o State courts – majority of civil/criminal cases

o States that spend more on Medicaid have less in poverty

o Houston is the largest city without zoning or land regulation

Total Government Spending past - present

- Must be controlled for population and inflation

American Federalism Expenditures

- Government spending increased with New Deal and WWII

o Increased for Korean War

o Increased for Vietnam War

o Increased for Iraq War

o military conflict = increased spending

- By 1940s federal spending and grants outnumbered state funds

o Federal spending % since WWII went down

o State and local has been stable

- Presidents

o Truman – Korean War

o Eisenhower – spending went down, warned nation of unneeded military spending o Kennedy/Johnson – high spending went down then increased due to military  spending – military spending > welfare

o Nixon/Ford – spending decreased then increased

o Carter – spending increased

o Reagan/Bush 41 – spending decreased

o Clinton – spending decreased to the lowest in modern history (surplus) o Bush 43 – 9/11, spending increased with Afghanistan and Iraq Wars

▪ Medicare part D – prescription drugs, Great Recession (spending increased  then decreased after recession)

o Obama – spending increased then decreased

- State and local spending was highest in 1929

- Post 1933 federal spending increased to majority

Government Revenue and Budgeting Tax and Non-Tax Receipts as a % of GDP

- US is the 3rd smallest among developed countries

9

- Norway and Denmark have the highest

o Post-materialistic countries are less individualistic

Composition of Federal Tax Revenue

- Individual income tax

o Before WWII – less than 20%

o During WWII – highest above 40%

o Post WWII – stable around 45%

- Payroll taxes: money into social security, payed by people

o 1930s – less than 1%

o WWII – 20%

o Post WWII – increased from 10% - 40%

o the people are producing the bulk of the money to the government (85%) - Corporate income tax: now pays 10-12% of federal revenue

o Decreases over time

o WWI – highest at 45%

o 2014 – 10%

- Excise tax: tax on luxurious goods, the rich

o Decreases over time, now at less than 5%

o 1930s – highest at 45%

- other

o 1930s – highest at 30%

o stable around 5% - 10%

State and Local Tax Burdens Map

- lowest taxes – Alabama (6.5%), South Dakota (7.1%), Wyoming (7.1%), Tennessee (7.3%),  TX (7.6%)

- highest taxes – New York (12.7%), New Jersey (12.2%), California (10.9%), great lake  states, NE states

State and Local Expenditures Per Capita Map – can only be as much as revenue

- lowest expenditures – Georgia ($6,573)

- highest expenditures – Wyoming ($13,291)

- Texas - $7,234

Revenues and Expenditures

- Taxes paid to government was 30% of income in 2007

- Government spent $15,200 per person in 2007

10

- User or client pay: user pays for all goods/services

- Ability to pay: government uses tax $ to fund education – services eligible for all regardless  of wealth

- Private goods and Public goods

o Excludable – only those who can pay get goods - education

o Non-rivaling – everyone can receive the good

o Merit good – good/advantageous for society, goods not denied to those who cannot  pay: public education, transportation, healthcare (debatable – who pays?)

- Negative correlation between Medicare and poverty

Federal Income Tax % for Households

- single

- married joint

- income %

- capital gains %

- 0 – 9,275

- 0 – 18,550

- 10%

- 0%

- 9,276-37,650

- 18,51-75,300

- 15%

- 0%

- 37,651-91,150

- 75,301-151,900

- 25%

- 15%

- over 415,050

- over 466,950

- 39.6%

- 20%

- 26 corporations pay NO income tax

o corporate welfare – taxes are much lower for corporate businesses

o ex. Pepco, PG&E Corp., General Electric

- corporations paying largest tax bills

o Exonn Mobile 7%, Wal-Mart 2%, Conoco Phillips 13%

State Government Revenue

- Taxes – sales, severance, property, selective, and sin

- Federal grants

- Fees/licenses

- Interest

- Sales – buildings and land

- Borrowing – must be approved by Governor, 80% of Texas legislature must approve - Gambling/lottery

11

State and Local Gov. Revenue  Sources

State and Local  

taxes

17%

Federal  

support

43%

Other State and  

Local sources

40%

State and Local Expenditures

1. Education 26%

2. Social services and income maintenance 23% 3. Insurance trust

4. Transportation

5. Environment and housing

TEXAS Revenue

1. State taxes

2. Federal funds

3. Licenses, fees, fines, penalties

4. Interest and investment income

TEXAS Tax Revenue

1. Sales  

2. Franchise

3. Motor fuels

4. Motor vehicle

TEXAS Revenue over time

1. State taxes

12

2. Federal funds

3. Fees, interest, other

Tax Incidence – how taxes impact individuals

- Progressive FEDERAL INCOME TAX

o Greater income - greater taxes, lower income - lower taxes

- Neutral

o Different tax rates, proportional to income, difficult to achieve

- Regressive

o Same tax %, poor pay a higher portion of income in taxes

Types of Taxes

- Income

o Avoided by bartering

- Sales

o Introduced in 1932, flat %

o Regressive (poor will feel the impact)

o 45 states

o TX – 6.75%, drugs and food exempted

- Property

o Flat % (regressive)

States Dependent on Income Tax

- Oregon, Colorado, Kentucky, New York, Mass.

- Texas does not have income tax

States Dependent on Sales Tax

- Washington, Wyoming, South Dakota, Tennessee, Miss.

- Oregon, Montana, New York, New Hampshire, and Delaware do not have sales tax State Dependent on Property Tax

- Texas, Montana, Wyoming, Nevada, Florida, Minnesota, Maine, New Hampshire, Vermont All states = REGRESSIVE TAX

- Majority of states have become more regressive since 1995

13