Midterm 1 Add on POLI 359

Question 1

POSTWAR SETTLEMENT

Answer 1

1945-1973 democratic state form was the product of crises (Great Depression, WWII, and Cold War) that initiated a transition within the regime from classical liberal state to welfare state.
- preserve democracy in the face of democratic deconsolidation that threatened breakdown, and instead brought about democratic re-equilibration.

Question 2

Reasons why CL broke down

Answer 2

o Restricted franchise
o Labour laws that only offered marginal protection of workers and poor wages
o Minimal to no social programs
o States make promises for reform to maintain popular support in WWI…then don’t live up to them

Question 3

Great Depression

Answer 3

o Protectionism and breakdown of international trade
o Stock market crash
 Halted production
 Eliminates significant amount of wealth
Consequence: poverty and unemployment
 Questions legitimacy of unregulated capitalist market

Question 4

Welfare State

Answer 4

-Post war settlement
• Corporatism : compromise between labour, capital, and the state. collective bargaining, state intervention
• Keynesianism: State must intervene to moderate severe swings that could lead to depression. Counter Cyclical Demand Management.
• Fordism: Assembly-line production, millions of unemployed to work and able to buy goods they produce
• Commitment to full employment: b/c of reconstruction WWII, Gastarbeiter
• Welfarism: redistribution of resources to meet social needs, typically via government monetary transfers and provision of state services
• Growth of the State Sector

Question 5

Reasoning behind Welfare state:

Answer 5

• Market is imperfect. Economy can subject people to crises no fault of their own, so provision of welfare provides level playing field.

Question 6

Keynesianism

Answer 6

State must intervene to moderate severe swings that could lead to depression. Counter Cyclical Demand Management.
-Fiscal:  Taxation
• Decrease in economic downturns, increasing individual spending.
• Increase in economic booms, decreasing money in circulation and avoiding inflation crisis.
 Government Spending
• Increase in economic downturns, decrease in booms
• Accumulate debt in economic downturn, as spending will restore economy and that improved economy will pay back that debt via taxation and interest

o Monetary Policy
 Interest
• Low interest rates promote borrowing and spending
• High interest rates curb inflation