AP US Government: Ideologies & Economic Policies - The Night Before Review 🚀

Hey! Let's get you prepped and confident for tomorrow's exam. We're going to break down ideologies and economic policies, making sure everything clicks. Let's do this!

🏛️ Ideologies and Economic Policies: A Quick Overview

Understanding the different ideologies is crucial. They shape how people view the role of government in the economy. Here's a breakdown:

🎯 Core Ideologies

• Liberal (Progressive) Economics:
  • Favors more government regulation of the marketplace.
  • Believes the market isn't always fair and needs intervention for equality.
  • Supports policies like:
    • Increasing minimum wage
    • Strong labor protections
    • Environmental regulations
    • Increased spending on social programs (education, healthcare, infrastructure)
  • Sees the government as a redistributive force, using taxes to reduce inequality.

• Conservative Economics:
  • Favors little to no government regulation of the marketplace.
  • Believes the market is the best resource allocator; government intervention causes inefficiency.
  • Supports policies like:
    • Reducing taxes and regulations on businesses
    • Protecting property rights (patents, copyrights)
  • Emphasizes individual responsibility and self-reliance.
  • Supports reduced welfare programs and government spending.

• Socialism:

  • Supports active government role in regulating the marketplace.
  • Believes the government should ensure fair and equitable economic operation.
  • Advocates for a strong safety net and prevention of monopolies.

• Progressivism:

  • Also supports an active government role in regulating the marketplace.
  • Believes the government should promote fairness, equality, and protect rights.
  • Supports government intervention for economic stability and preventing wealth concentration.

• Centrism:

  • Supports a balanced approach to government intervention.
  • Believes in limited intervention for stability and fairness, avoiding market interference.

🔄 Connecting Ideologies

It's important to see how these ideologies are not always black and white. For example, a 'liberal' might support some market-based solutions, and a 'conservative' might agree on the need for some regulation. Think of them as points on a spectrum rather than rigid categories. This nuance is often tested in the AP exam.

⚙️ Theoretical Economic Support

Let’s dive into the economic theories that underpin these ideologies. Understanding these will give you a deeper insight into policy debates.

💰 Fiscal vs. Monetary Policy

Before we get into the theories, let's clarify two key tools:

• Fiscal Policy: Government spending and taxation to influence the economy. Think of it like the government's budget: how it spends and how it taxes.

  • Expansionary Fiscal Policy: Increase spending, reduce taxes (used during recessions).
  • Contractionary Fiscal Policy: Reduce spending, increase taxes (used to cool down an economy).

• Monetary Policy: Central bank (like the Federal Reserve) uses money supply and interest rates to influence the economy.

  • Expansionary Monetary Policy: Increase money supply, lower interest rates (stimulates growth).
  • Contractionary Monetary Policy: Decrease money supply, raise interest rates (slows down growth).

⚖️ Keynesian vs. Supply-Side Economics

These are two major opposing economic theories:

• Keynesian Economics:
  • Supports an active role for the government in regulating the marketplace.
  • Believes in using fiscal and monetary policies to stabilize the economy and prevent recessions.
  • Government should increase spending during recessions to boost demand.
  • Monetary policy (lowering interest rates) encourages borrowing and spending.

* **Example:** Obama's response to the 2008 Great Recession (infrastructure spending, industry support, lower interest rates).

• Supply-Side Economics:
  • Supports a limited role for the government in regulating the marketplace.
  • Government should create a favorable business environment by cutting taxes and regulations.
  • Lower taxes on businesses and individuals will increase the incentive to work, save, and invest.
  • Reduced regulations allow businesses to operate more efficiently.

* **Example:** Reagan's policies in the 1980s (tax cuts, deregulation).