introduction to political thinking. 4 major political ideologies four major political ideologies...
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Introduction to political thinking
4 Major Political Ideologies
• Four Major Political Ideologies
• Classical Liberalism
• Libertarianism
• Conservatism
• Populists
Classical Liberalism Government should stay out of the peoples’ business because
government is almost always oppressive (Jefferson) Industrial Revolution changes this meaning because it restricts individual
autonomy-wage labor did not allow for achievement of the liberal idea of an autonomous individual
Government was seen as a way of promoting individual development through wage and work regulations; government should liberate people from poverty, oppression, and economic exploitation
Outside of economic realm, government should leave the people alone or promote individual liberties
Liberals believe in solving problems collectively through government, provide for economic well-being of the nation, tolerance of various lifestyles, non-interventionist foreign policy, strong but economical defense
Libertarianism They embrace most aspects of classical liberalism, but emphasize
the autonomy of the individual and the minimal role of the government in all spheres of life
Usually reject any regulation of private matters such as religion, morality or conscience
Libertarian views have tended to be ignored until recently Due to increase in the general level of education, mass media, affluence Increased polarization of Democrats and Republicans
Libertarians tend to believe in: protection of property and the freedom of the individual, no government intervention in the economy, non-intervention in foreign affairs
Conservatism After the industrial age, conservatives called for the government to stay
out of economic affairs and allow businesses to follow their actions Humans do not have the capacity to plan for the economic future Economic inequality is a natural outcome of inequality of human ability-
taking wealth from those who have it undermines initiative Focus on what is good for the economy as a whole, not the individual
Conservatives emphasize order-no problem restricting individual liberties in favor of common sense or morality
Conservatives believe in: reducing spending on social programs, reduction of taxes to encourage economic growth, strong military defense, little action to redress gender and racial discrimination, assertive foreign policy, acceptance of moderate welfare state
Populism An outgrowth of industrialism, tend to embrace many
liberal ideals of private property and individualism and the economy has not provided those to enough people They favor economic intervention on behalf of the common
man Tend to reject the changes in social values and mores that
came with industrialization-want to preserve more traditional social values, and are willing to use the government to achieve that purpose
Populists believe in: programs to provide for the economic well-being of small business and the common man, reducing spending on social programs, reduction of taxes to encourage economic growth, noninterventionist foreign policy, return to the values of the past, mistrust of foreign competition
American ideologyLiberals Conservatives
Military spending Spend less Spend more
Use of force Less willing to commit More likely to support
Abortion Support for freedom of choice
Right to life
Affirmative action Favor Oppose
Scope of government Government is a regulator in the public interest
Favor free-market solution
Taxes Tax the rich more Keep taxes low
Spending Spend more Spend lower
Cutting crime Solve the problems that cause crimes
Stop coddling criminals
Cumulative Responses to 10 Opinion Questions in 2008(from Erikson and Tedin, p. 79)
What Is Really Happening?• An intensely polarized elite—political activists generally, pundits,
convention delegates, office-holders• The media playing up differences—conflict is dramatic, eye-
catching; agreement is not• The media are poor and generally ineffective at analysis and rely
heavily upon selective examples to dramatize differences• Confusion of positions and choices, especially when observing
voters
Who is a Republican or Democrat?• Most Democrats are labor union
members, minorities (especially Hispanic and African-American), 18-29 year olds, blue-collar workers, unions, and unemployed, widowed, Liberals, non-religious, and people that live in urban areas.
• Most Republicans are men, professionals, executives, Protestants, married couples, conservatives, have European ancestry and live in rural areas, conservative, military vets, wealthy, self-employed or businessmen, Cubans, the West (more rural).
Where are the Republicans and Democrats—2014?
(in one class period)(borrowed from Ulrich Kleinschmidt)
Two Hundred Years of Economic Thought
Classical Economics 1776-1930s, 1980s to present• Also known as: new classical, supply-side, trickle down
economics, monetary• Key people: Adam Smith, J.B. Say, David Ricardo (comparative
advantage), A. Marshall (graphs), Hayek, and Milton Friedman
• Competition causes businesses to always improve product to win the market• Competition causes businesses to
lower their prices• This effect is called the Invisible
Hand• In the end, consumers get
products that are better and cheaper• Inefficient companies leave or
disappear from the market• New companies will have to be
more efficient in order to compete
• Say’s Law• Say built on Smith’s theory• If suppliers overproduce, they
correct the surplus by cutting production and lowering prices
• The economy then rebalances because wages are lower, but so are prices
• If suppliers under produce, they correct for the shortage by increasing production and raising prices
• The economy will rebalance because wages are higher, but so are prices
• Thus, “Supply creates its won Demand” Say’s Law
Fundamentals of Classicalism
Role of Government in the Classical World• Government ensures that competition occurs
• Government must stop monopolies or unions because they prevent competition
• Classical economists want to lower taxes to reduce government interference; real income reduces the role of government
• In the long run, the economy will balance near Full Production (in other words, stay out of way and keep markets level)
Keynesian Economics: 1930s to present
• Key people: J.M. Keynes, Krugman
• Fundamental idea is that competition is GOOD, but flawed
• In the Short Run, Smith’s Invisible Hand will always have companies that are inefficient• Say’s Law is a myth because
businesses can’t really lower prices at will because production costs are fixed (known as sticky prices)• Consumers will also be paid by
businesses, but will save some of the income, thus undercutting production• This will cause a constant leakage
or loss of income
• Prices can also increase easily, but not decrease. This is known as the Ratchett Effect• Markets can reach
efficiency and full employment, but Keynesians assume that they will soon become inefficient or recessionary• Recession, in Keynes world,
will probably become the economic norm• Government must now
step in and correct Aggregate Demand
Keynesianism
• Congress will represent the interests of the people by using taxes and spending to prevent recessions• Congress can’t wait of
the potential Long Run because workers need help• “In the Long Run we are
all dead”
• During recessions• Congress should cut taxes, and
raise government spending (deficits occur)
• During inflation• Congress should raise taxes and
cut government spending (creating a surplus)
• Congress also has automatic stabilizers to keep economy from crashing too much• Unemployment insurance• Social Security• Progressive taxes
Role of Government in Keynes world
Monetary School Economics: (1913), 1970 to the Present• Also known as: Federal Reserve Policy, Central Bank Policy
• Current US Chairman of the system: Volcker, Greenspan, Bernanke
Monetary School• Competition is Good, but needs fine tuning.
• The average recession lasts about 14 months in the US
• We only know a recession has started after at least 6 or more months have passed
• Even if Congress agrees on a policy, it can take many more months to enact
• By the time the policy comes into force, the recession may have already ended naturally
• Congress may be able to cut taxes during recessions, but they will never have the will to raise taxes to fight inflation
Monetary School continued• Therefore, the best way to correct economic flaws is to have the Federal Reserve
act quickly• Plus, the Federal Reserve can focus on stable prices that helps control demand
pull inflation• They can also focus on long run growth with realistic growth around 2-3%
• This means that the government, through this nonpolitical and independent agency can control national growth by manipulating interest rates and the money supply (which is also why Ron Paul doesn’t like the FED)
• This will keep inflation under control and healthy for businesses and other borrowers
• When recessions threaten, lower interest rates on borrowing.• When inflation threatens, the FED will raise interest rates on borrowing• The FED is typically better at controlling inflation than preventing recessions