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Left
- Democrat
- Liberal/Neo-liberal
- Keynesian economics
- institutional social welfare
- more government: public
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Right
- Republican
- Conservative/Free market
- Adams/Friedman
- Supply Side economics
- Residual economics
- less government: private
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What have advocates of liberalism argued for?
advancing the public good by promoting an expanding economy coupled with the growth of universal, non-means-tested socail welfare and health programs
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New Deal: Social Security Act of 1935
The government taxes the wealthy, thereby securing the necessay revenues to fund social programs for workers and the poor
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Liberalism led to
Federal Housing Administration, Medicare, Veterans' pensions, and federally insured student loans
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What was left of traditional liberalism was replaced by _____ that was
- Neoliberalism
- more cautious of government, less antagonistic toward big business, and more skeptical about the value of universal entitlements
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postliberal formulation replaced social welfare entitlements with investments in _____
Human capital
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after the replacement of social welfare entitlements; public spending was divided into "_____" and "_____" categories.
good and bad
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"bad":
"good":
- unproductive expenditures on welfare and price supports
- investments in human capital, such as education, research, and job training
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Keynesian economics _____.
drives liberalism and most welfare state ideologies.
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Keynes' economic theories _____.
formed the substructure and foundation of the modern welfare state, and virtually all welfare societies are built along his principles.
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Keynesian economics are sometimes called ____.
Demand economics
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Keynes saught and economic balance. During a recession he believed in the need to
print money and spend it then when it's over stop printing and spending to prevent inflation
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Whereas liberalism is guided by Keynesian economics, the conservative view of social welfare is guided by ____.
free market economics
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Conservative or free market economics believe that ______.
government is the cause of economic problems
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Milton Friedman called for a government that _____.
inactive in economic affairs that did not try to manage of intervene in the business cycle
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In relavance to conservative or free market, supply side economics (popular in the 1980s) was an idea to ______.
cut taxes, especially for the wealthy, believing they would have incentive to make more money, thus pay more in taxes, creating revenue
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Conservatives believe that large social welfare programs are _____, because they_____.
- detrimental to society
- erode work ethic and divert money that could be invested in the private sector
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The public choice theory states that ____.
public sector bureaucrats are self-interested utility-maximizers, and that strong incentives exist for interst groups to make demands on government
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Public choice theory was _____.
misnamed, does not represent the public, rather represents the lobbyist and interest groups
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Flaws in free market economy
- unregulated free markets did not yeild superior economic gain
- collapse of the housing market
- foreclosures
- subprime loans
- risky investments
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