Auburn University
Spring 1994
U-102C: Political Economy
Dr. Johnson

Midterm Exam #2 Version 1

Instructions: This is a closed-book, in-class examination. You will have the entire class period in which to work. Pick the one best answer to each of the following test items and record your answers by blackening the appropriate bubbles next to the corresponding item numbers on a large blue Scan Sheet. Be sure that you both print your name on the answer sheet (last name first) and also blacken the appropriate bubbles in the columns below the letters. Please also write your signature on the space marked for that purpose on the Scan Sheet. All students should write in their student I.D. numbers in the Identification field (items A through I), but only those students willing to have their exam scores and grade computations publicly posted by their I.D. number should blacken the dots that will make the I.D. number machine-readable. Blackening the dots for the I.D. number constitutes permission to post this information.

1. According to the political philosophy enshrined in the Declaration of Independence, the primary purpose of government is

2. Which of the following is not among the economic policy- relevant powers explicitly assigned by the Constitution to the Congress? 3. Which of the following are not protections for economic freedom and private property rights embedded in the U.S. Constitution? 4. In "The Federalist #10," James Madison argues that 5. An assumption that is common to both James Madison's arguments in the Federalist and Adam Smith's argument in the excerpt from The Wealth of Nations in your xeroxed readings collection is 6. According to your "Glossary of Political Economy Terms," the class of ideologies that typically strive to show that existing political or economic inequalities within society are justified and that the existing order is as close as practically attainable to an ideal order is 7. According to the classification of American political ideologies offered in Maddox and Lilie's "The Roots of Contemporary Ideologies" (and applied in the "What's Your Ideology?" lab exercise), a person whose political beliefs supported both (1) a low degree of government intervention or control in the economy and also (2) a high degree of government intervention to enforce traditional or conventional values in the area of personal behavior, would be classified as 8. According to the results of the lab questionnaire on U-102 students' attitudes toward personal and economic freedoms presented in Professor Johnson's lecture on American ideologies, the largest fraction of U-102 students were classified as 9. According to the analysis of 14 1991-1992 roll-call votes in the U.S. House of Representatives (102nd Congress) presented in lecture, the smallest proportion of the House membership consisted of Representatives whose voting records classified them as 10. According to Professor Johnson's lecture on elections as a means for popular control over government policy, the argument that constituents exert substantial control over their representatives' votes in Congress by rewarding or punishing incumbents at the polls 11. The common practice in which two (or more) legislators each agree to trade away a vote on a bill about which they care little in exchange for the other's vote on a bill much more important to them is called 12. Of the roughly 20,000 bills introduced in Congress every session, about what proportion are ever called up for a floor vote by the full membership of the House of Representatives or Senate? 13. The chairmen of the standing committees in the US Senate and the House of Representatives 14. Which of the following is not normally an important influence on the committee assignments that a re-elected member of the U.S. House of Representatives receives at the beginning of each two-year term of office? 15. Which of the following is not true of bills in the U.S. Congress? 16. Important sources of influence by American political parties' national leaders over the way their party's delegations in Congress vote on controversial bills include 17. As has been the case for almost the entire period since World War II, the Republicans are currently 18. When the President refuses to sign a bill passed in identical form by both houses of Congress and instead returns it to Congress with the reasons for his refusal, this is referred to as 19. A bill in Congress that (if passed and signed into law) makes it legal for a Federal agency to spend money from the Treasury for some specified purpose is 20. The executive agency that is primarily responsible for examining the funding requests of the various executive branch departments and then putting together the President's spending recommendations to Congress every year is 21. Which of the following represents "regulatory policy"? 22. According to Professor Johnson's lecture, which of the following circumstances improves the chances for a U.S. President to be successful in getting his legislative program through Congress? 23. Use statements 1 and 2 to determine the best answer below:
  1. According to Anthony Downs' "Economic Theory of Democracy," the tendency of party platforms in a two-party democracy is to converge toward each other, with both parties ending up relatively close to the ideological center of gravity of the voting public.
  2. According to Anthony Downs' "Economic Theory of Democracy," one may predict that the policies of a democratic government will usually be biased in favor of consumer interests over producer interests, because the consumers of any given product or class of products being regulated usually greatly outnumber its producers.
24. In his lecture on interest groups, Professor Johnson argued that the most important reason why many important interests in the U.S. do not get represented by organized pressure groups is 25. Which of the following is not one of the arguments made by Prewitt and Verba in support of their claim that there are important differences between the Democratic and Republican parties? 26. According to Benjamin Ginsberg's article "Money and Power: The New Political Economy of American Elections," the newest developments in election campaign technology, such as public opinion polling, TV advertising, phone banks, direct mail advertising and fund-raising, and the techniques of professional public relations management, 27. The acronym "PAC" stands for 28. According to Fred Wertheimer's essay arguing that PACs undermine democracy, by far the largest proportion of campaign contributions made by PACs in Congressional races 29. The most numerous, well-funded and influential category of pressure groups in contemporary American politics was said by Professor Johnson to be 30. A device for assembling the individual claims for relatively small damages to a large number of similarly situated people so that they can be filed as a single lawsuit is 31. Under the new budget procedures established by the 1985 Gramm-Rudman Act, when Congress passes appropriations in amounts whose totals exceed the spending limits Congress supposedly established for itself in its April Budget Resolution, the President is required to issue an Executive Order that reduces spending authority according to a fixed formula for across the board percentage reductions from the various non-exempted Federal departments and programs in order to "take back" the excess amount of money appropriated. Such a Presidential action is called 32. Use statements 1 and 2 below to determine the correct answer, based on Kathleen Kemp's article "Industrial Structure, Party Competition, and the Sources of Regulation."
  1. Usually the Presidency will support greater political protection of the interests of large corporations (especially those operating in world wide markets and those seen as most crucial to the national economy), while the Congress (and especially the House of Representatives) will normally show greater favoritism for the interests of small business.
  2. In general, the economically dominant corporation or corporations within a regulated industry (the "ins") tend(s) to be relatively advantaged over their competitors or potential competitors by the existing regulatory laws and policies affecting their industry and tend(s) to support the dominant political party. The more disadvantaged corporations within a regulated industry (the "outs") tend to seek regulatory policy changes favorable to their interests by means of political support of the minority party.
33. Use statements 1 and 2 below to determine the correct answer.
  1. Recent studies investigating the relationship between the degree of political independence of a country's monetary policy makers from control by elected politicians and the long term rate of inflation in the country's economy have amassed evidence that, in general, the greater the monetary policy makers degree of independence from the politicians, the higher the rates of inflation.
  2. Compared with the monetary authorities in most other advanced industrial countries, the United States Federal Reserve system is very highly controlled by elected politicians.
34. Which of the following is not one of the Federal Reserve Board's major tools for regulating the rate of growth of the money supply?
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