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A2 POLITICS > Economics > Flashcards

Economics Flashcards

1
Q

Who did Keynes influence?

A

He was part of Lloyd George’s think tank

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2
Q

What does Keynes admit about economics?

A

Economics is complicated but should not stop governments intervention

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3
Q

What does Keynes believe government should do regarding economics?

A

That it is the moral duty of government to ensure steady growth
Unemployment is a moral evil

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4
Q

What does Keynes admit about capitalism?

A

That it is the best system however needs help

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5
Q

Fiscal policy

A

Accepts borrowing
Multiplier effect
Smoothing out the bumps in the road

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6
Q

What does Keynes believe about government spending?

A

“Expenditure creates its own income” Keynes

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7
Q

When was the busketalism?

A

Post war - 70’s
Focus on unemployment
Links to beveridge

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8
Q

Why is Keynes rejected in the 70’s?

A

Stagflation under Callahan

Rejects Phillips curve

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9
Q

What idea takes over in the late 70’s?

A

Friedman- Chicago school

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10
Q

Does Keynes return?

A 
Yes in recent years. 
Part nationalisation of banks 
Big Govt spending HS2
Increase in borrowing 
Quantitive easing 
Low interest rates
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11
Q

What does Keynes say to do in times of recession?

A

Cut tax
Borrow more
Spend more

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12
Q

What does monetarism focus on?

A

Inflation

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13
Q

Why is unemployment not the key goal in monetarism?

A

Workers won’t demand pay rises so won’t price themselves out of the market

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14
Q

What theory did Friedman use to what causes inflation?

A

Velocity of circulation

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15
Q

What is the solution to slow down the movement of money?

A

Raise interest rates

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16
Q

Who adopted monetarism?

A

New right

Regan and Thatcher

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17
Q

Is monetarism popular with the voter?

A

No, voters prefer a focus on unemployment

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18
Q

When did Britain try to join the EU?

A

In the 60’s

Under Wilson and Heath

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19
Q

Who opposed the EU in the 60’s?

A

Enoch Powell

Gaitskell (labour) “End of 1000 years of history”

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20
Q

When did we join the EU?

A

1973 Heath

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21
Q

Did we get a good deal to begin?

A

No, the UK made a large contribution but was one of the poorest members at the time

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22
Q

What are some of the opposition views to the EU?

A

Parliamentary sovereignty
Increases unemployment
Loss of British values

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23
Q

Points for first referendum?

A

Called by Wilson to unite party
Tory’s and Thatcher remain
Remain win by 67%

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24
Q

Thatcher quote on EU?

A

“A European super-state exercising a new dominance from Brussels”

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25
Q

What was Thatcher a key driver of?

A

The Single European act 1986

26
Q

What happens under the major years regarding EU?

A

Britain opts out of the Euro

Euroskeptisism rises in the media

27
Q

What happened in the Blair years regarding the EU?

A

Blair considered the euro- Brown blocked

Spoke of a tragedy for Britain by politicians failing to appreciate European integration

28
Q

What are the main provisions of the single market?

A 
No protectionism inside 
No border capitals 
Free movement of people 
Mutual recognition of qualifications 
Equality of taxes
29
Q

Fact for free movement of people?

A

55,000 EU citizens working in the NHS

30
Q

Disadvantages of Single market?

A

Job losses
Wage reduction
Skills drain

31
Q

Advantages of single market?

A

Move of capital

Movement of people and skills

32
Q

Example for job losses?

A

UK dairy farmers come under pressure from dairy farmers in Romania

33
Q

When was the Euro launched?

A

2002

34
Q

Advantages of joining the Euro?

A 
Eliminates the exchange rate risk
Price transparency- better comparison  
Reduced transactional cost
Greater mobility for workforce 
Single monetary policy
35
Q

Disadvantages of the Euro?

A

Loss of monetary policy- unable to influence AD levels
Differing Economies- UK is very sensitive to interest rate policy
Recession

36
Q

Who country has been bailed out?

A

Greece

France to Greece nearly 9 billion Euros

37
Q

What approach did Thatcher have towards debt?

A

“Housewife approach”

38
Q

What was Gordon browns nickname?

A

Prudence brown

39
Q

Statistics for the U.K. And debt?

A

In 2000 the average person owed 160% of their household income
Total private debt- £1.6 trillion

40
Q

Fact to show the increase in private debt?

A

Average person in the U.K. owes appro £54,000 this was £29,000 10 years ago

41
Q

How was private debt allowed to increase?

A 
Loosen regulation of banks under Thatcher 
Growth of home ownership
Increased forms of borrowing 
E.g.- credit cards and short term loans 
Embourgiesement
42
Q

We have a free market in the U.K.?

A

Thatcherism- Education and privatisations
Blair and 3rd way- using free market to provide high quality public services
City of London
UK post brexit

43
Q

We have regulated market in the U.K.?

A

EU membership
Utilities and housing market
Response to 2008
Minimum wage

44
Q

Parties do follow the same economics policy?

A

Privatisations- Blair and Thatcher
Supply side economics- Blair and Thatcher
Response to 2008- Neo Keynesianism

45
Q

How much were the banks bailed out post 2008?

A

124 billion

46
Q

What policies showed neo-Keynesianism?

A

Labour tax cuts- 2008 and 2009 tax acts saw large temporary cuts to the majority of households
All 2 parties support HS2- multiplier effect

47
Q

Which supply side economics did Blair do?

A

Education reforms

Harsh on trade unions

48
Q

How has May shown supply side?

A

T levels

Grammar schools

49
Q

How has corbyn shown supply side?

A

Small business tax cut

Free tuition fees

50
Q

Parties disagree on economic policy?

A

Taxation
Welfare spending
Intervention in free markets

51
Q

How do Labour and Tory disagree on utilities?

A

Labour- nationalise energy industries

Conservatives- make it easier to compare tariffs

52
Q

How to labour and Tory disagree on employment?

A

Tories have done nothing to stop 0 hour contracts

Corbyn pledged to end them

53
Q

The UK does have a free market?

A

Thatcherism- free market in education
Blair and 3rd way
The city of London

54
Q

Describe the city of London?

A

Big Bang started by Thatcher- followed by brown
Cut no. Regulators to reduce power of watchdogs
Needed to attract banks to London in a globalised world

55
Q

What did the 3rd way implant?

A

Compulsory competitive tendering

56
Q

We have a regulated market in the U.K.?

A

EU membership
Post 2008
Minimum wage

57
Q

Regulation on banks post 28?

A

Limits to bankers bonuses
Bank levy- an annual tax on balance sheets
Financial services bill- a ring fence if a if a bank fails

58
Q

What is an open economy?

A

Free movement of goods and services moving in an out of the country
Competes with countries across the globalised world
Immigration and emigration of workers
More choice of products for consumers

59
Q

We do have an Open economy in the U.K.?

A

EU membership
Financial interconnectedness
Foreign owned companies
MNC’s

60
Q

The UK has achieved a low inflation, low unemployment economy?

A 
Tony Blair 
Neo-Keynes post 2008
Demand side 
Supply side 
Open economy

A2 POLITICS (5 decks)

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