Government Spending and Taxation

Exercise

NOTE: I will collect these at the end of class and include them as part of your participation grade.

Examine each of the 2 articles assigned for today.

Identify 1 claim made by each article. Then, identify at least 1 piece of evidence (grounds) for the claim.

Write 1-2 sentences explaining whether you believe the claim, based on the grounds. Why or why not?

Classroom Logistics - Notes

During lectures, you must take notes.

This means, you should write down in a shorthand form information that will be useful to you later from the lecture.

For Debate, this means writing down definitions of parts of arguments, examples of argumentation, and specific information about topics discussed.

For translation, you should write rules of grammar, examples, and other items discussed

Classroom Logistics – Absences

If you are absent from class, it is your responsibility to catch up on material you have missed.

The best way to do this is to ask your classmates to share their notes and knowledge with you.

You must at least attempt classroom activities, even if you were absent or don’t have notes. Otherwise, we can’t make improvement.

Classroom Logistics – E-mail

I encourage you to send me e-mails, but you must do so in an appropriate fashion. This is important both so I can keep track of your e-mail and for future professional work in English.

Unless your e-mail is a direct response to something I have sent you, always compose a new message rather than replying.

Always include a relevant subject line.

Always use an appropriate salutation and capitalization, and always sign your name.

Example E-mail - Poor

Subject: (no subject)

hi, can you tell me about the assignment we did yesterday. i was absent and i did not understand you

Example E-mail - Good

Subject: Question about the Future Tense

Hi Mr. Vasey,

I was reviewing my notes from last class, and I realized that I did not completely understand part of the lesson. How do I identify the subordinate clause in a French sentence using the future?

Thank you for your help. All the best,

Mohammed

Taxation and Spending

A key role of government is using the collection of money (taxes) in order to provide services to its citizens.

The problems is that citizens would like to pay as few taxes as possible while retaining a large number of services from the government.

In order to remain economically viable, governments have to frequently decide whether they need to raise funds by raising taxes or reducing spending in some area.

Benefits of Increased Taxation

Increased taxes allow the government to gain more money, which it can then use to provide more services.

The government can frequently make more efficient use of taxpayer funds collected centrally than individuals could working informally (roads, transportation services, hospitals, schools, etc.)

If taxation is progressive, those who are poor will receive more services for less money than their wealthier counterparts.

Problems with Increased Taxation

Few citizens want to pay more money to the government, even if it means they receive more services.

Public funds can be wasted, going to individuals or projects which benefit few (corruption).

If taxation is regressive, the poor will be harder hit by increased taxation.

If taxation is progressive, the rich may leave the region/country or actively try to make less taxable money.

Benefits of Increased Spending

Citizens generally like receiving more benefits from the government.

Public funds can spur economic growth, leading to greater tax revenue in the future that will fund the initial deficit (Keynesian)

Government enterprises may be less likely to be motivated by profit than the private sector.

Generally, the poor benefit more from government programs than the wealthy.

Problems with Increased Spending

Increased spending may run up a government deficit that future economic growth will not be able to fix.

Increased spending may require raising taxes.

Government services do not always benefit the intended beneficiaries and are sometimes less efficient than the private sector.

Spending and Taxation in the United States – 19th Century

Traditionally, taxation in the United States was fairly regressive, meaning that everybody paid more or less the same percentages. There was no income tax tailored to individual incomes.

There were relatively few social services. People looked primarily to private charity for aid.

Great Depression

The Great Depression of the 1930s marked an economic low for the United States.

The economy stagnated, people lost jobs, and the poor had little recourse to social services that might aid them in their time of need.

The New Deal and World War II

Under President Franklin Roosevelt, the US government greatly increased spending on social programs in the New Deal.

This included things like Social Security to pay retirees and public works projects to give people jobs building essential services.

The onset of World War II also increased government military spending considerably, further spurring economic growth.

The 1960s and 70s – The Great Society

The post-war period saw a general increase of social services designed to help the poor in the United States, including unemployment benefits, food stamps, etc.

President Lyndon Johnson oversaw a program known as the Great Society, a program of increased spending that also saw accompanying increases in taxation.

1980s - Reaganomics

In the 1980s, President Ronald Reagan cut many government programs and dramatically reduced aspects of the US tax code.

Economic growth, which had stagnated, resumed, but so did the income gap within American society.

Today

Conservatives generally support the lowering of taxes to encourage business expansion, private job growth, and the reduction of government corruption.

Liberals generally support raising taxes to provide more government services, reduce income inequality, and stimulate the economy through spending.

Exercise - Debate

In a group of 4 or 5, form a position on this issue.

1. Make a claim. Do you think governments should solve fiscal (economic) problems by raising taxes or decreasing spending?

2. Provide grounds. Why or why not?

3. Organize a presentation of the debate. Assign each person either a claim or ground to present against another group.

On Wednesday, I will ask opposing groups to present their cases and then have a debate.