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Related Flashcards
Cards In This Set
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What is Public finance? What is the fundamental Issue?
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It is the taxing/spending activities of the government. The real issue is the use of real resources.
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What are the two approaches to the relationship between the individual and state?
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Organic view and the mechanistic view
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Define the Organic view of the government.
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Each individual is a part - The gov. is the heart. The goals of the society are set by the state, which then attempts to lead society to the realization of those goals. These goals can differ widely, so how are they to be selected?
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Proponents of the organic view argue for what about the goals of society?
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Certain goals are natural for society. Such as sovereignty over geographical area. Still what goals can truly be considered natural for society.
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Define the mechanistic view of the government.
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The government is a contrivance created by individuals to better achieve their individual goals.
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The most limited view of the mechanistic government is what? What does Adam Smith argue should also be included?
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Protect its members from violence. Smith argues the government should have the responsibility to create and maintain public works and institutions (roads, bridges, dams, ext.)
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Where do opinons diverge between libertarians and social democrats?
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Libertarians believe beyond the limited view of the government, regulations impinge on individual freedom. Social democrats might say a poor individual is free to spend his income, but the scope of his freedom is limited.
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What is our current view of the government?
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It is individual, rather than group, that is paramount. Mechanist view dominates political thought.
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If someone claims something must be done in "national interest", besides referring to welfare for individual(s), then they are taking what view?
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Organic view point
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Article 1, section 8 of the constitution empowers congress to do what?
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Pay debts and provide for the common defense and general welfare of the United States.
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How does congress interpret "general welfare"?
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Very broadly. It effectively puts no constraints on Gov. spending. It does not limit the size of federal expenditure either absolutely or relative to size of the economy.
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Unlike expenditure bills, where do all bills raising revenue originate from?
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The house of representatives.
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Why did our founding fathers take so much care in limiting government taxing power?
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Because of extreme dissatisfaction with British tax policy during colonial period.
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What was the first stipulation on tax power? List example.
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Congress can not discriminate among states when setting tax rates. E.g. tax put on gas must be same rate in all states.
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What is the second stipulation on tax power? What is unique about it?
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No direct tax can be levied on a person. In 1913 congress made an amendment to the 16th amendment to allow the personal Income tax.
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