No Bellwork today. We have too much to do! Read the reminder above. Make assignment __ in your notebook. 1 Reminder: Test on Wednesday. Only one day left for extra credit: Take Ch. 2 or 3 practice tests online. Notebooks will be collected Wednesday also. Minus 10 points for each day late. What will we learn today? What will we learn today? Standard The role of market economy in political and personal liberty. Standard Explain the roles of property rights, competition, and profit in a market economy. Unit: Intro to Economics Day 5 “I’m so happy I could cook you two dinners!”

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Big Idea: Sometimes the US government has to step in to create programs to aid poor, disables, and elderly people. 3

The Poverty Problem Free markets are great at creating wealth, but that wealth is unevenly distributed. This leaves some people below the poverty threshold, an income level below that which is needed to support families or households. In 2004, the poverty threshold for single parent under 65 years old was $12,490. How do we solve the question of poverty? 4

The Welfare System Since the 1930s, the government has tried to solve poverty by collecting taxes and redistributing those funds in the form of welfare. Welfare: government aid for the poor Can people become dependent on welfare? Does welfare discourage productivity? 5

Cash Transfers State and federal governments provide cash transfers, direct payments of money to poor, disables, and retired people. Programs: Temporary Assistance for Needy Families (TANF): Federal money goes to states and they decide how they want to run their welfare program. Aims to encourage people to work and limit lifetime benefits. Social Security: Gov takes money from your paycheck, redistributes it to the elderly when they retire. Unemployment Insurance: If you lose your job, you get benefits. You must prove you are looking for a job. Workers’ compensation: If you’re injured on the job, you receive benefits while you stay home and heal. Very expensive for employers. 6

In-kind benefits: The government provides the poor with in-kind benefits, goods and services provided for free or at greatly reduced prices. Examples: food stamps, subsidized housing, legal aid. Medical Benefits Medicare: covers 65+ years old and the disabled Medicaid: covers poor or unemployed 7

Education Gov. pays for the education of the poor Faith-Based Initiatives Bush started a program that gave money to churches or charities for them to spend on social services (welfare). There was some controversy about this. Should gov. give money to churches? 8

Answers on pg. 23 – 70 This Crossword is similar to a quiz. I expect a quiet room while you work on it. There is no talking, copying, or working together. 9

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Gov. Intervention Political Cartoons Use pg. 57 – 60 (look for your title, read those paragraphs) Topics: Tracking the business cycle (Group 1) Providing employment (Group 2, 8) Promoting economic growth (Group 3, 7) Promoting economic stability (Group 4, 6) Encouraging technological progress (Group 5) 11

Government Regulation Booklet Food and Drug Administration Federal Communications Commission Federal Aviation Administration Environmental Protection Agency Consumer Product Safety Commission G o v e r n m e n t R e g u l a t i o n s 12