Economics Final Research Paper
Economics Research Paper Final
For centuries ear marks and pork barreling have been a serious issue within our government. An example of this is the Mohair famers we read about in our textbook Naked Economics CITATION Cha03 \l 1033 (Wheelan). It all started back around WWII when the government would provide subsidies to farmers who produced a type of wool that was utilized in military uniforms. As time went on, however, they transitioned to a completely different material and technically didn’t need the mohair farmers anymore CITATION Jas18 \l 1033 (Pye). But the farmers were still receiving tax breaks! If politicians keep the money coming to those farmers than that will secure that communities vote. The amount it takes tax payers to cover the mohair bill isn’t even noticeable that’s why it’s so easy to get away with. It’s much easier to sustain a minority rather than a minority support the majority. Thus, the LGBTQ and how it’s much easier for their voices to be heard rather than a straight, white male/female in the United States.
Pork barrel politics is an important part in the congressional style of politics and legislative process. A renowned congress politician stated that all politics is local in nature. The benefits sought by the local areas is a centralized part of congress politics and legislative process. Pork barrel projects which are also known as distributive benefits, are targeted to benefit some specific parts of population but costs of these projects are spread across the whole population in the form of taxation. Some theorists state that the costs of pork barrel projects exceed their benefitsCITATION Tho \l 1033 (E.Elwood).
One of the most important aspects that is assumed to be underlying in the pork barrel politics is reelection goal. Members of congress have strong incentives to give both time and other resources to take some particular benefits for which they can claim credit. These legislators are credited by the local people for initiating only that legislation which is considered beneficial for a particular area. This means that other broad-based policies are left to be considered by other legislators.
The members seek benefits for benefitting their local areas, there are two distinct categories of reasons to supply related benefits. The foremost reason to supply pork is to satisfy demands from district. The initial bills undertaken by the legislators were meant to satisfy the demand of particular districts. The initial discussion on distributive politics revolved around the bills that would boost the chances of reelection for the person who presented the bill. The individual benefits theories are presented to support this mindset. The dominant role is played by the various committees which have members which show higher demand for benefits within the jurisdiction. There have been coalitions made for achieving the desired benefits. The other perspective for supplying pork is less individualistic in nature. There are certain political actors in a society who seek support for their favored general interest legislation or majority party leaders in congress who want to save party’s majority or bureaucrats needing support for their relevant organizations. These aspects also depict collective benefits theories of pork- barrel politics CITATION Tom18 \l 1033 (Schatz).
As mentioned earlier, congressional committees have an important role to play in the pork-barrel politics. If we consider individual benefits theories, there is a huge role to be played by the congressional committees. Firstly, the committees supply some sort of equilibrium that does not allow the majorities to win over and over again. Restrictive rules can be applied by these committees which allows several committees to indulge in bargains with each other using their control over own policy areas. These aspects allow the members of committee to extract pork barrel benefits for their own selves. The process of placing the members on committee is itself dubious because members are placed on committees based on the benefits sought by their relevant districts. This thought of district consideration means that members on committees will demand and receive more benefits than an average member of congress.
The theories on collective benefits do not predict committees based on high demand to the same extent. Reason for this difference is that the reputation of parties is at stake because of pork barreling content. There are two distinct goals for the parties out of committee appointments, reelection of members and to maintain the unity of party. The first goal is more apparent in the committees with narrower goals or which will affect only a few districts. Committees taking on national goals have to be represented by members who show the party’s view in an effective way.
If we consider the informational theory of congress, it also takes into account the collective benefit. In this regard, the committees are expected to represent floor majority in their formation. Some of the members will be demanding high and will be giving their specialized knowledge to committees in return. Committee members benefit when a general benefit is an ultimate objective of the legislation. The coalition leader may be a committee chair which will mean that members will benefit irrespective of the number of members. This happens because the leaders want their members to support them on the floor CITATION Dia11 \l 1033 (Evans).
If we consider the convertibility or risk aspects related to pork barrel concept, the first thing will be seen if the contract in one state is binding in the other state as well. This will mean that a committee must contain members from various states and all these members will discuss the implications of certain amendments and how these amendments will bind into the already existing laws of that state. There is always a risk that any one of the parties do not complete their legal responsibilities. A committee should keep this aspect into consideration while coming up with some conclusive comments. In a global economy, there is always a chance that exchange rates fluctuate for and against parties. The committees should provide ample discussion on the fluctuations of exchange rates. All the regimes regarding exchange rates have their own pros and cons. However, UK adopted the gold standard and it being the largest economy, established the gold standard as a collective good. The collective benefit extended as there were many infrastructure developments across UK and other related countries. If we talk about the political economy of trade, there were protection intended activities which were supported by those producers who could not compete others effectively. Consumers preferred free trade because it resulted in lower prices of goods for them. An example is given regarding trade protection on softwood lumber where producers were better off but consumers suffered because prices were raised.
Hecksher- Ohlin theory is an extension of comparative advantage theory keeping in view the various factors of production required to make different goods. There are some capital intensive and some labor intensive techniques for production of goods. A country will have a comparative advantage in the factor of production that is in abundance in it. Thus the pork barreling will ensure that only those projects will be [assed which will use the abundant resources present in the country. This will also mean that there will be a minimal room for innovation or working on other resources which are not abundant with the country. However, the major problem with this approach is that all the resources are diminishing in nature and they will ultimately finish. Successful countries will be those who work on non-abundant resources and make them their strength. Thus, these countries will not need any kind of Pork barreling because they will have some part of all the resources and it will use them appropriately. Another aspect is the different perception of factors related to different countries. A country that is poor in labor will use the technology which is a form of capital to produce more output from the given amounts of inputs. Thus it is not the mere number of units in a given factor of production that matter, it is the total amount of output that matters. Stolper- Samuleson built on Ohlin theory and stated that free trade will benefit those who work in industries using factors that are abundant in that country. Industries using scarce factors will be at a loss as a result of free trade. There will be a convergence of price in the international trade scenario and an increase in specialization.
When we talk about the tariffs, there has been a considerable impact of their implementation across the country. This is especially true for the states where farming is the major source of earning of people CITATION Wil19 \l 1033 (Mauldin). A committee on tariffs will have a different opinion on tariffs if it has more members from Iowa than Rhode Island. The elasticity of demand for a product also plays an important role in deciding whether tariffs will be imposed on a product or not. Inelastic demand will mean that there will be a lower percentage change in demand of a product as compared to change in price. People will show considerable demand for these products at a higher price as well. Applying tariff to agricultural products can be the right policy if the burden of the price increase is equally divided among the customers. Secondly, the price increase will result in a decrease in demand and competitiveness. Thus the producers will suffer and if the majority of producers are from a single state, that state will oppose the tariffs.
Later in the book from pages 177-180 it talks all about the 5.4 tax on ethanol gasoline. Ethanol supposedly burns cleaner, however, that is not fully agreed upon in the scientific community. On this alone, the US treasury spent over 7.1 Billion in tax revenues. This made it so there was a major increase in the demand for corn which had a lot to do with a special interest in the corn farmers in Iowa. Bill Bradley, President of 1992, claimed he was trying to do away with all subsidies, but strangely enough kept the ethanol subsidy. Every candidate after that followed that same pattern. All in all, the smaller the group or community, the greater the benefits distributed especially if it is an unorganized population. “In politics, the tail can wag the dog…” CITATION Cha03 \l 1033 (Wheelan).
Another excellent example given from the book is the mandatory teaching certification process all teachers in the US must go through. Each new year teachers moving into the work force are required to take tests and certifications teachers of previous years never had to take. So the older teachers are never receiving this new information. However, according to the Hamilton Project conducted in Los Angeles, CA certifications doesn’t equal a good teacher. When a law was passed in the late 90’s to cut classroom sizes LA has to hire a bunch teachers many of which were completely uncertified to teach. Data was collected from each classroom the 150, 000 students who were chosen for this study were in. And for over three years the data was collected and it came to a strong conclusion that teacher certifications do not matter.
In an interview with a Heber city, UT rocky mountain middle school 7th grade science teacher Kimberly Conlin sheds some light on this subject and gives her two cents on what she has seen and observed over her 30 years of teaching experience. She talks about the new coming teachers and how they sometimes don ‘t know squat, but then again some of the more “experienced” teachers can sometimes be just as bad. It all has to do with the actual knowledge that teacher chooses to retain from him/herself and how much they care about their students. Despite Ms. Conlin’s good intentions and love for her students and passion for what she does, she has nearly been regulated out of the classroom! By implementing traditional, common characteristics that are often expected of a teacher are not being ostracized and shut down.
The trade agreements like NAFTA will reduce the importance of Pork- Barrel spending at least regarding the economic aspects. As discussed earlier, tariffs are one factor that can start off pork-barrel spending but with the free trade agreements, these tariffs are excluded from the trade between countries. NAFTA applies to firms who produce products in Mexico, US and Canada even if these companies do not belong to any of these countries. The major consequence of these types of agreements is that there is a direct competition among people growing similar crops in the US and Mexico. Since Mexico has a higher percentage of exports to America as compared to vice versa, the NAFTA will benefit Mexican farmers and people more than the US.
In essence, all the decisions have to be made by keeping in view the political economy. The leaders prefer to remain in their seats and they have to take care of smaller groups whose short term goals conflict with the long-term welfare goals. Globalization results in the prices of products to fluctuate all over the world. Governments interfere by imposing duties on imports to safeguard their own industries but this results in the increase of prices in the local market because these markets are inefficient. Adjustment to these changes come with certain costs. Farmers don’t cut down their produce because they are self-sufficient for their own needs on the agricultural produce. Farmers have been over represented in the government and it also has an impact on pork barrel spending. A policy of protecting a certain industry or field will mean that these costs of adjustment will be distributed over a larger number of sectors in the overall economy. The World War I had disastrous impact on the global economic system. The exchange rates fell and countries tried to diversify the costs of adjustment to their neighbors. There was a lack of coordination between the countries and it led to much more problems. This situation was very similar to the Pork-barrel spending where only a small number of people benefit at the expense of all others. Similarly only a small number of countries benefitted from these actions but a lot more suffered. One of the major consequence of the World War I was the unavailability of capital to various countries. Governments could not take any appropriate steps because they were busy in handling the foreign exchange problems. This was because globalization played a similar role to the pork-barrel spending. All these issues led to the start of World War II.
BIBLIOGRAPHY E.Elwood, Thomas. "Congressional Earmarks and Pork-Barrel Politics." Journal of Allied Health (2002): 127-130.
Evans, Diana. "https://calgara.github.io/Pol1_Fall2017/Evans_pork_2011.pdf." March 2011. https://calgara.github.io/Pol1_Fall2017/Evans_pork_2011.pdf. <https://calgara.github.io/Pol1_Fall2017/Evans_pork_2011.pdf>.
Mauldin, William. "https://www.wsj.com/articles/republican-sen-grassley-challenges-trump-on-some-trade-policies-11560513135." 14 June 2019. https://www.wsj.com. <https://www.wsj.com/articles/republican-sen-grassley-challenges-trump-on-some-trade-policies-11560513135>.
Pye, Jason. "https://www.freedomworks.org/content/earmarks-and-pork-barrel-spending-breed-corruption-congress." 1 January 2018. https://www.freedomworks.org. 31 August 2019.
Schatz, Tom. "https://www.usatoday.com/story/opinion/2018/07/18/pork-barrel-spending-explodes-under-republicans-column/792588002/." 18 July 2018. https://www.usatoday.com. 1 September 2019.
Wheelan, Charles. Naked Economics: Undressing the Dismal Science. New York: W.W.Norton and Company, 2003.
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