Public Policy Analysis Flashcards

In U.S. budgetary policy, 'mandatory spending' refers to expenditures that:

Answer: Are set by law and paid automatically without annual appropriations

Mandatory spending — including Social Security, Medicare, and Medicaid — is governed by permanent laws that automatically fund benefits for all eligible recipients without annual congressional appropriation votes.

Which approach to healthcare policy is characterized by a single government entity paying for all healthcare services from tax revenues?

Answer: Single-payer system

In a single-payer system, the government collects taxes and acts as the sole insurer, paying providers directly — as in Canada's Medicare system — eliminating multiple private insurers.

The Affordable Care Act (ACA) of 2010 primarily addressed healthcare access in the U.S. through:

Answer: Expanding Medicaid, creating insurance exchanges, and mandating coverage

The ACA expanded Medicaid to millions of low-income adults, established state insurance marketplaces, prohibited denial for pre-existing conditions, and introduced an individual mandate.

Which term describes a situation where a government provides a benefit that leads people to take greater risks because they are protected from the consequences?

Answer: Moral hazard

Moral hazard occurs when protection from risk changes behavior — for example, bank bailout guarantees may encourage banks to make riskier loans because losses will be absorbed by taxpayers.

Environmental policy often uses which economic concept to argue that polluters should pay for the harm they cause?

Answer: The polluter pays principle

The polluter pays principle holds that those who produce pollution should bear the costs of managing it to prevent damage to human health or the environment.

A 'public good' in economics and policy is characterized by being:

Answer: Non-excludable and non-rivalrous

Public goods are non-excludable (you can't stop people from using them) and non-rivalrous (one person's use doesn't diminish another's) — like national defense or clean air — which often require government provision.