Quick study academic US government 600dpi

WHAT KIND OF COUNTRY IS
THE UNITED STATES?
"A Republic...if you can keep it!" -Benjamin Franklin
I. For much of V.S. history, there has been debate
as to whether the V nited States is a republic or
a democracy. There are many differences; listed
below are the most important.
A.Republic: A system where the people elect
representatives who are free to act on their own.
based on their personal beliefs, conscience or other
factors. to do what they feel is right.
B. Democracy: A system where the representative
is expected to obey the mandate of those who
elected himlher, be it hislher district, state. nation
(depending on the office), regardless ofhislher own
personal beliefs.
II. There is a radical difference between the world
of the founding fathers and the modern world.
A. Their idea of a republic was based on a centuries­
old idea that the people elect the most educated and
wisest from amongst them. These representatives
use this wisdom and education on the public behalf.
since the people are both less wise and farther
away from the center of power and the details of
government.
B. As people became better educated and communication
allowed more immediate access to information, their
influence became stronger.
C. Although the framers of the Constitution believed
in a republic, it has developed into more of a
democracy, as politicians cite the desires of their

constitueQts as the reason for positions.
D. In modem times, many Congressmen/women have
taken positions contrary to their constituents in
areas about which they have felt strongly. Subjects
such as impeachment, gun control, abortion, etc.,
have often led to are-awakening of the spirit of the
"republic."

As declared in the Constitution of the United States:
I. FEDERAL POWERS
A. Overall powers necessary for national sovereignty
are given to Congress. These include, but are not
limited to:
I. Inherent Powers: Integral to national
sovereignty.
a. Conduct foreign policy
b. Declare and pursue war
c. Make and enforce treaties

d.Establish and maintain diplomatic relations, etc.

2. Delegated Powers: Not inherent, but assigned
to national policy for cohesion and interaction
between the component parts (states).
a. Coinage of money

b.lnterstate commerce, etc.

3. Implied Powers: Based upon the right to "...
make all laws which shall be necessary and proper

for carrying into execution (Congress's) powers"
(Article I, Sec. 8 - U.S. Constitution) that are
"naturally" part of delegated/inherent powers.
a. McCulloch v. Maryland: For example, in this
landmark case, court ruling was, in essence, that,
because coinage is a national power, there must
be some vehicle for its handling, distribution
and maintenance, and thus, a national bank is
implied.
4. Powers to Expand the Central Government:
Need for a strong central government is
pre-eminent.
a. The "national supremacy" clause (Article VI)
makes the Constitution, and all laws deriving
from it, the "supreme law ofthe land. "
b. The national government has the power to do all
that is "necessary and proper" in the waging
and conduct ofwar.
c. The "commerce" clause (Article I, Sec. 8)

grants broad powers over economy, personal
activities, etc., affecting trade crossing state!
international lines.
d. Taxation (Article I, Sec. 8): Congress has
"Power to lay and collect Taxes, Duties, Imposts
and Excises, to pay the Debts and provide for
the Defence [sic} and general Welfare of the
United States ... " (but all these shall be uniform
throughout the U.S.).
II. THE POWERS OF THE STATES

A.Reserved Powers: "The powers not delegated to
the United States by the Constitution, nor prohibited
by it to the States, are reserved to the States
respectively, or to the people." (10th Amendment
[Bill of Rights) to the U.S. Constitution). This is
the most commonly quoted phrase by those who
hold states' rights above federal.
B. Concurrent Powers
I. Not shared powers, but those that are available to
both state and federal government.
2. EX: taxation, right to charter corporations, ability
to borrow money, etc.
C. Relations with Other States: "Full faith and credit
shall be given in each State to the public acts,
records, and judicial proceedings of every other
State . .. (Article IV - U.S. Constitution).
I. Each state is bound to honor the rules of others.
2. The article goes on to rule that each state must
grant all "privileges and immunities" of the state
to those from other states and, conversely, cannot
grant such to, say, fugitives from another state
(who must be returned).
3. Oversight of interstate transactions is vested in
the federal Congress. INOTE: Oversi.:ht here
means "overseeing," not "omission. "j

2. Majority Leader
a. Since the Speaker is, ostensibly, the "speaker"
for all members of the House, the Majority
Leader works closely with the Speaker in most

decisions.
3. Majority " Whip"
a. As the name implies, responsible for party
discipl ine. keeping members " in line" and
generally enforcing "proper" party behavior.
4. Minority LeaderlMinority " W hip"
a. Perfonn the same functions as above for the
minority pa rty.

D.Powers of the House

I. Introduces legislation, which, if passed, moves on
to Senate for approval.
2. Originates revenue raising measures.
3. Sole power of impeachment.
4. Approves by 'I, vote any const itutional
amendments prior to state ratification.
E. Structure of the House
I. Because the House of Representatives is so large,
almost all early work is done by committees
before being brought to the fu ll House for
a vote.
2. Standing (Permanent) House Committees
Agriculture Ii 1\
Appropriations il [[ \
Armed Services I 11
Budget
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Education and Labor r[11
Energy and Commerce

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Financial Services It [1 I

Foreign Affairs

Homeland Security I [[

House Administration


THE THREE BRANCHES OF GOVERNMENT
I. LEGISLATIVE: Makes the laws of the land,
represented by two bodies, the House of
Representatives and the Senate (together,
these make up Congress).
II. EXECUTIVE: Oversees the management of
government.
III. JUDICIARY: Interprets the laws of the land as
stated, or implied, by the Constitution.

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Ways and Means Committee


THE LEGISLATIVE BRANCH - CONGRESS
I. THE HOUSE OF REPRESENTATIVES - T HE
"LOW ER" HOUSE
A . The most direct relationship to a democracy.
B. Originally had no fixed number of members but
allowed each state a number of representatives
proportional to its population, elected for a two-year
term from districts established within the state.
l. In 1929, the number of representatives was
fi xed at 435. with each state having at least one
representative.
2. A 1964 Supreme Court decision mandated states
apportion their districts equally to preserve the
concept of "one man, one vote" and avoid the
possibility of more powerful districts controlling

the vote.
3. This allows each representative to represent a
relatively small area, with a reiatively cohesive
view.
C. Leadership positions within the House
I. Speaker of tbe House
a. Elected by the majority party.

b.Presides over the House.

c. Principal leader (over Majority Leader) of
party.
d. Third in line of succession (after Vice
President), in event both President and V,P. are
simultaneously incapacitated.
e. Assigns bills to committees.
f. Important in assigning membership within
committees.

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[NOT E: These are the current House Commillee...
The House can establish. or disso/,'e, commillees
and/or subcommittees as circumstances warrant.)
3. The major and most powerful of the standing
(permanent) House Committees are:
a. Rules C ommittee
I . Sets rules for debate.
ii. Can "kill" a bill by not voting it out of
committee.
iii. Can be overridden by a "discharge petition"
signed by a minimum of 2 18 members
(absolute majority).
b. Ways and Means C ommittee
i. Oversees federal revenue measures.
ii. Has authority over borrowing money (National
Debt).
iii. Oversees Social Security programs.
iv. Oversees trade and tariff regulations.
c. Appropriations
i. Oversees the "raising of revenues" provision
(this committee' s most important function).
4. Additionally. the House can establish:
a. Select Committees: f or a limited purpose,
which may last for several Congresses, as
needed.
b.Joint Com mittees: Combining members from

both House and Senate.
c. Conference Committees: Joint committees
to resolve differences between House and Senate
versions of a bi ll [see How a Bill Becomes a
Law].


Branch
II. THE SENATE - THE "UPPER" HOUSE
A.Has two members from each state, regardless of
population. who serve for six years.
8. Designed to act as a check on laws representing the
interests of the "few" (district) by having a clear
overview of the "many." the state as a whole.
e. Leadership Positions in the Senate
I. The Vice President of the United States
a. Officially "President" of the Senate.
b. Largely ceremonial role. as this is a non-voting
position except:
i. In the event of a tie (50/50). the Vice President
casts the deciding vote.
ii. Paradoxically, the least and most important
Senate position.
2. President Pro Tempore ("Pro Tem")
a. Almost entirely a ceremonial title.
b. Usually granted to the senior member of the
majority party.
c. Presides when the Vice President is
unavailable.
d. Otherwise, has the same power as any other

Senator.
3. Majority Leader
a. The true power in the Senate.

b.Elected by Senate members ofhislher party.

c. The most visible member of the Senate.
d. Often meets with. and acts in concert with. the
Speaker of the House andlor the President.
4. Minority Leader & Majority/Minority
"Whips"
a. Function in pretty much the same way as their
House counterparts.
D. Powers of the Senate
I. Provides "advice and consent" (i.e.• final
approval) on presidential nominees for virtually
all positions. including Supreme Court Justices,
Federal Court Judges. Ambassadors. Secretaries
of Cabinet posts. etc.
2. Ratifies all treaties (by 7', vote).
3. Sole power to try impeachments.
4. Votes on all bills and legislation sent up from
the House.
a. More often than not. "amends" such bills before
passage, requiring a return to the House, which
either votes for the amended bill or continues to
revise it [see How a Bill Becomes a Law].
5. The Filibuster
a. A single Senator. wishing to block a vote
on legislation, can hold the floor indefinitely.

bringing all other work of the Senate to a halt.
i. A Y, vote for cloture (a call to close the issue
and vote) by the entire membership of the
Senate is the only way to halt a filibuster,
short of giving the Senator-in-question what
he/she wants.
E. The Structure of the Senate
I. Like the House, the Senate relies on committees
to do most of the preliminary work prior to a vote
on legislation.
2.. Majority membership on these committees goes
to the majority party.
3. The chairman of each committee is, usually, the
senior majority member of that committee.
4. Standing (Permanent) Senate Committees
Agriculture, Nutrition and Forestry
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Armed Services I' III I· I 1 •

Banking, Housing and Urban AtTairs

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Commerce, Science and Transportation

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Energy and Natural Resources

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Environment and Public Works

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Foreign Relations hit 1. f II I n Ie
1Health, Education. Labor
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Homeland Security and
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I. Has no constitutional standing and makes no joint

decisions.
2. The departments represented are:
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a. Agriculture: Oversees farm economics.
Veterans Affairs I II!' ekr 11 11 I .~
regulates food industry via research, consumer
[NOTE: These are the current Senate Committees. The
information and dissemination of modem
Senate can establish. or dissolve, committees and/or sub­
farming techniques.
committees as circumstances warrant. As with the House.
b. Commerce: Promotes business and trade;
there are numerous special committees and/or subcommit­
administers Patent and Census bureaus;
tees oflimited duration.]
promotes sales of U.S. products abroad;
5. The most powerful standing Senate Committee is
oversees weights and measures programs.
probably the Appropriations Committee, which
weather forecasting, statistical analyses of U.S.
controls the actual dispersal of funds.
industries.
c. Defense: Oversees all branches of the Armed
Forces, including the Coast Guard. during
wartime. Coordinates all military activities
THE EXECUTIVE BRANCH
among all the services. The largest, most
I. THE PRESIDENT

expensive government agency, with the possible
exception of Homeland Security.
A.Makes n o laws. but can issue "executive orders"
d. Education: Oversees federal education
which are designed to implement those laws already
programs and funding. It should be noted that
on the books, as interpreted by the President.
most such programs/funding are still under local
B. Serves up to two four-year terms.
jurisdiction.
I. Until 1951, with the passage of the 22nd
e. Energy: Oversees research. development.
Amendment, there was no legal limit on the
energy conservation. etc. Regulates nuclear
number of terms a President could serve, but
power for energy use.
tradition held it to two, the number of terms
f. Health and Human Services (originally.
George Washington served before retiring.
Health. Education. and Welji:m! (HEW}). created
2. Franklin D. Roosevelt's unprecedented four
when Department olEducatioll was formed as a
wins (1932~1944) prompted Congress to make
separate Cabinet post. Oversees federal health
the two-term "tradition" the law of the land.
and welfare programs.
e. The powers of the President, as dictated by the
g. Homeland Security: The newest Cabinet-level
Constitution, are to:
office (est. 2002) oversees and coordinates

I. Serve as Commander-in-Chief of the armed forces.
all aspects of the ongoing War on Terrorism.
2. Commission officers.
The Office employs over 170.000 people and
3. Convene Congress in special sessions.
consists of four divisions:
4. Grant reprieves/pardons - only in federal cases.
1. Border and Transportation Security
and barring impeachment.
ii. Emergency Preparedness and Response
5. Receive ambassadors/representatives of foreign
iii. Information Analysis and Infrastructure
governments.
Protection
6. Oversee the "faithful execution" of the laws of
iv. Science and Technology
the land.
[NOTE: Each o.lthese jilUr divisions is headed by an
7. Appoint officials to lesser offices.
Undersecretary. Numerous aspects/agellciesjrom the
8. Appoint ambassadors, judges, high officials (all
other Cabinet offices (except State) ha\'e been moved 10
of which must be approved by the "advice and
this new department. including FEMA. Coast Guard.
consent" of Congress).
Secret Service and Immigration. Note that none oj'
9. Approve/veto legislation.
these offices have been eliminated. hut many oj'their
10. Make treaties (with congressional "advice and
functions have heen translerred. while others report

consent").
to Homeland Security (see Department of Homeland
I I. Wield "executive power" as defined/implied in
Security»).
the Constitution and by tradition.
h. Housing and Urban Development (HUD):
(NOTE: Until 1973. the President could also unilaterally
Oversees federal programs for housing and
call up and deploy troops during wartime. After the Viet­
urban renewal.
nam War. Congress passed. over President Nixon's veto.
i. Interior: Development of natural resources.
the War Powers Act requiring congressional approval
public lands. and conservation.
within 60 days ofdeployment.)
j. Justice (Attorney General): Oversees all federal
D.Staff and Offices of the PresidentlWhite House
legal business, with separate divisions covering
I. Chief of Staff
areas such as: antitrust. civil rights. immigration.
2. Press Secretary
etc. In charge of:
3. Legal Counsel
i. U.S. Marshal Service
(NOTE: There is a subtle distinction between the legal
ii. all U.S. Attorneys
counsel for the office of the President (also called the
iii. Federal Bureau of Investigation (FBI)
White House Counsel) and counsel for the individual
k. Labor: Originally combined with Commerce;

President occupying that office.}
oversees federal workplace and employment
4. Approximately 500 additional staffers, advisers,
programs and regulations.
analysts, etc.
I. State: The first executive agency created. in
5. Nine permanent agencies, with 2,000+ employees,
1789, to oversee and administer foreign policy.
performing specifically defined managerial tasks
m. Transportation: Oversees all federal transpor­
defined in their titles, under the "institutionalized
tation policy and federal aid to transportation:
Presidency":
i. Federal Aviation Administration (FAA)
Office of Management and Budget (OMB)
ii. Federal Highway Administration
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National Security Council (NSC)
iii. Urban Mass Transit Administration
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n. Treasury: Collects and distributes federal
Council of Economic Advisors (CEA)
revenues. Agencies include:
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i. Internal Revenue Service (IRS)
Domestic Policy Council (DPC)

ii. U.S. Mint
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iii. Bureau of Engraving and Printing
National Economic Council (NEC)

iv. Bureau of Alcohol, Tobacco and Firearm$
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(ATF)
Office ofthe United States Trade Representative
o. Veterans Affairs: Oversees the Veterans
(USTR) " " ""~,,
Council on Environmental Quality (CEQ)
Administration (VA). supervising hospitals.
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pensions. education programs. insurance.
Office of Science and Technology Policy (OSTP)

etc., for veterans of the military.
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3. The Vice President and
Office of Administration (OA)

U.S. Trade Representatives also
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serve on the Cabinet.
E. The White House
Cabinet,
II. THE VICE PRESIDENT
consisting of the secretaries of 15

A. Next in line for the Presidency
federal agencies appointed by the

in the event the President
President with the "advice and

cannot serve.
consent" of Congress.

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S. Originally, the #2 vote getter in the election. This

often led to bitter opponents occupying the two
offices and a totally opposite viewpoint empowered
in the event of presidential incapacity. Thus,
presidential/vice-presidential candidates began
running as a single unit, thereby insuring that the
winning President and the winning Vice President
both had the largest number of votes.
C. Presides over the Senate but does not vote,
except in the event of a tie.
D. Performs those duties relegated to himlher by
the President.
E. Acts as President in event of presidential incapacity.

While Hou•• Cabln.t
Agriculture (USDA) www.usda.1:0v

Commerce www.commercc.l:ov

Defense (DOD) www.dcfcnsclink.mil

Education www.cd.l:oV

Energy (DOE) www cl1crI:Y.I:0v

Health and Human Services (HHS)

www.hhs.gov
Homeland Security (DHS) www.dhs.gov
Housing and Urban Development (HUD)
www.hud.gov

Interior (001) www doi.gov

Justice (DOJ) www.usdoj.gov

Labor www.dol.gov

State www.state.go\

Transportation (DOT) www.dot.gov

Treasury www.ustreas.gov

Veterans Affairs (VA) www.va.gov


I. HISTORY AND
STRUCTURE OF
THE SUPREME
COURT
A. The only court specified in the Constitution.
I. Established in Article III.
2. Congress given the right to establish lower
courts, but what these may be, how many, etc.,
is left vague.
S. The only federal branch that is comprised of
non-elected members; justices are appointed by
the President with the "advice and consent" of
Congress.
C. Currently, the Supreme Court has nine justices,

including a Chief Justice.
I. Originally (1789), there were six justices.
2. At various times, there have been as few as seven
and as many as ten j ustices.
3. In 1937, Franklin Delano Roosevelt, upset that
the court was overruling much of his New Deal
legislation, proposed adding one new justice for
every justice over 70 years of age.
a. This would have allowed him to name six
additional justices and given him an
overwhelming majority in any decision.
b.Conservatives and many liberals decried this
"court-packing" scheme, and it was quickly
abandoned (shortly after court ruled in favor of
two New Deal cases ).
c. evertheless, it set the precedent that the number
of justices remains unfixed.
D.Justices are appointed for life and can only be
removed by impeachment. This is so no justice will
feel the need to vote a certain way to gain favor with
any party or individual to remain in power.
II. THE LEADERSHIP OF THE
SUPREME COURT
A. The Chief Justice is the only "leader " of the court,
but hislher position is more one of "first among
eq uals" than leader, per se.
I. Authority to preside over case conferences and
to assign the writing of opinions.
2. Beyond that, the role is largely symbolic, but can
be quite powerful.

3. Often viewed as the embodiment of the court, the
Chief Justice's personality, judicial outlook and
intellect can mold the court's image in public
opinion and set the tone for which decisions are
made and how.

III. THE POWERS OF THE SUPREME COURT
A. Adjudicates cases that ari se through U.S. (as
opposed to state) constitutional issues, laws and
treaties of the U.S., maritime and admiralty issues,
interstate cases, and cases where an individual state
or the U. S. is a party in the case.
B. Has both original and appellate jurisdiction.
I . Original cases initiate with the court itself, e.g. those
involving a state and cases involving international
figures of state (diplomats, ambassadors, consuls,
premiers, prime ministers, etc.).
2. Appellate cases are those that have passed
through other lower federal courts (or, in rare
instances, a state' s highest court) and one side
finds reason to appeal.
C. The court can also "refuse" to hear a case, which
acts as a "ruling" that the last lower court to hear
it acted within parameters that preclude further
appeal (i.e., there was no reversible [legally unfair]
action during the hearing).
D. In the majority of its landmark cases, the court:
I. Interprets the Constitution as it applies to the
case, and in light ofmodern times.
2. This interpretation stands as the law of the

land unless/until the court itself reverses it.
IV. SOME LANDMARK SUPREME
COURT CASES
A. Marbury v. Madison (1803): In itself a minor case
of a denied presidential appointment, it established
the principle of judicial review, giving the court
the right to rule on the constitutionality of an act,
law, etc.
S. Mc Culloch v. Maryland (1819): Established the
constitutional supremacy of the federal government
over state governments as suggested by the implied
powers doctrine.
C. Dred Scott v. Sanford (1857): While declaring
the Missouri Compromise unconstitutional, it
also established that slaves were not citizens of
the U.S.
D. Munn v. Illinois (1877): States were allowed to
regulate private businesses in the public interest.
E. Plessy v. Ferguson (1896): Declared separate
but equal accommodations to enforce racial
segregation.
F. Standard Oil Co. of New Jersey et al. v. U s.
(1911): U.S. can dissolve a "trust" when that trust
is exercising "unreasonable restraint oftrade. ..
G. Schenk v. Us. (1919): U. S. can restrict free
speech, especially during wartime, when it is
shown to present a "clear and present danger . ..
H. Schechter v. Us. (1935): Congress cannot delel:ate
its power a nd authority to the President.
I. Dennis et al. v. U S. (1951): The Smith Act (stating

it is a crime to advocate the overthrow of the
government by force) is declared constitutional.
I. 1957's Yates v. Us. modified this ruling to apply
only to words connected to direct action in this
endeavor.
J. Brown v. Board of Education of Topeka (1954) :
Laws enforcing segregation in schools are
unconstitutional. States ordered to desel:rel:ate at
"all deliberate speed. "
K. Roth v. Us. (1957): Declared obscenity as that
which appeals to "prurient interest " and has "no
redeeming social imp ortance. "
L. Mapp v. Ohio (\961): Federal exclusionary rule,
stating that illegally obtained evidence can not be
used in a trial, is extended to the states.
M. Baker v. Carr (1962): State legislatures (and
later congressional districts) must be proportional
to the people represented to allow for equal
representation.
N. Miranda v. Arizona (1966): Suspects must be
informed of their rights under the law ~
being q uestioned in a crime.
O. Furman v. Georgia (1972): All death penalty
statutes, in all states, were unconstitutional as
written due to SUbjectivity and arbitrariness. Re­
written state statutes brought the death penalty
back within a few years.
P. Roe v. Wade (\973): Laws prohibiting abortion,
except in the last trimester, are unconstitutional
based on the 14th Amendment's implied right

ofa woman 's privacy in decisions about her body.
Q. University of California v. Bakke (1978):
Universities can admit students on the basis of
race in order to combat discrimination.

R. Bowers v. Hardwick (1986): States can regulate
sexual conduct, even in private and among
consenting adults.
S. Webster v. Reproductive Health Sen 'ices (1989) :
States can restrict access to abortions. so long
as they do not impose restrictions that WOUld, in
effect, outlaw them entire/yo
T. Harris V. Forklili Systems. Inc. (1993): Sexual
harassment claims can be valid even when no
severe economic or emotional damage occurs.
U. Bush, et al. v. Gore, et al. (2000): In a landmark 5
to 4 decision, the court overturns the ruling ofthe
Florida State Supreme Court and cedes that state 's
Electoral College m tes, and the Presiden()' olthe
United States, to George W. Bush.
V. Hamdan v. Rumsfeld (2006): Court finds that the
war crimes tribunal at Guantanamo Bay, Cuba
(established by the Bush admin istration ) lacks
"the power to proceed hecause its structures and
procedures ~ both the Uniform Code of
Military Justice and thefour Geneva Conventions
signed in 1949...
INOTE: This is a high(v illcomplete list. hilt it shows that
the Judiciarv Brallch has bel'li a major inllllence in shap­
ing the nation.]

.

THE CONSTITUTION & THE

BILL OF RIGHTS

INOTE : The Constitution of the United States, along
with the Bill of Rights, is contained in its own QuickStudy
guide entitled U.S. Constitution. Below is some commen­
tary to put it into perspective. ]
I. The Bill of Rights, the first 10 Amendments to the
Constitution, was NOT an afterthought.
A.It had always been intended to be part and parcel
of the Constitution, and to be ratified as soon as
possible.
B.Congress felt it was vital to get the basic Constitution,
the "rules " under which the countlY would operate.
into place as soon as possible.
C.The 10 amendments under the Bill of Rights were all
directly tied to real, or perceived, abuses of those
in the United States by the British Crown.
D.Adoption of the Constitution by many of the states
was contingent upon the guaranteed addition of
the Bill of Rights.
E.The Constitution was adopted a nd r atified in Ju ne
1788.
F.The Bill of Rights was ~ during the first
Congress. It was ra tified in 1791.

HOW A BILL BECOMES A LAW

I. Introduction by Senator or Representative, where
it is assigned a code number (e.g., HR 12345 ) that
identifies it for all time. After which, it is ...
II. Assigned to a committee· that determines ifthe bill
is worthy of consideration. If so, it is...
III. Assigned to a subcommittee· that studies the
proposal; may hold hearings on it, may amend it,
and then it is .. .
IV. Returned to the full committee, which may:
A. Accept the bill as presented
B. Hold its own hearings
C. Make amendments, etc.
D. After this "markup," the fina l version of the bill is
written, and the committee turns to ...
V. The House Rules Committee, which sets a timefuune
for debate on the bill, and determines the extent of
amendments from the floor that will be allowed via
a " closed rule" (severely limits amendments) or an
"open rule" (a\1ows for proposals from the floor).
INOTE: The Senate, which does not have a Rules Committee.
allows open-ended debate and amendment procedure.] After
this, the committee reports the bill out and it is set on the...
VI. C alendar, the weekly schedule of business
established by the majority leaders in consultation
with the minority leaders. The scheduled bill now
goes before the House (or Senate) for ...
VII. Debate, the duration is controlled by the committee
chair and ranking minority member or their
designates. During debate (subject to ''filibuster, ''
"open or closed rule. " etc.), amendments are

offered, accepted, or rejected. The bill. if passed,
is then ...
VIII. Sent to the other legislative body (i.e., House or
Senate) where debate continues. If. as is almost


always the case, this second body alters the
bill in any substantial way, it is returned to
the issuing body. If the changes cannot be
agreed upon infonna1ly, the two bodies may
form a ...
IX. Conference Committee of delegates from
both original committees who either initiated
or altered the bill. A compromise bill is then
reported out and voted on by both House and
Senate. If adopted, it is sent to ...
X. T he President. who will either:

A.Sip the hill, passing it into law, or

B.Y.dll the bill, which can be overridden by a 'l'.

vote in each chamber (i.e., House and Senate).
C. In rare instances, the President may refuse or
postpone any action, or opt for a " pocket veto"
(i.e., the President "puts it in his pocket" and
forgets it) in hopes that later the circumstances
that led to the bill
Path 01 a Bill
will alter.

HOUSE

SENATE

Introduction
Introduction
*NOTE: Many bills are
viewed as "gestures " by
Committee
Committee
a particular member;
Subcommltt. .
Subcommittee
others are viewed as

too controversial or Committee hearing,
Committ" hearing,

markup
markup
have other "problems"

that are readilv dis­
Rules Committee
cernible to a ';'ajority
House Floor
House Floor
of the committee/sub­
Conference Committee
comminee. These bills

Adoption by ~Both Houses
are not acted upan, but.
The President
instead, are allowed to
V.to ~
"die in committee. '1

•
•

•
•
•

~
•

House & Senate Floor
Veto

•
•
•
1

~

Approve

o~errid. . . . . Law /

THE POLITICAL PARTY SYSTEM
I. BRIEF HISTORY OF PARTY POLITICS
A. A political party is an organized group ofpeople
with similar views on the nature of government
and the methods by which government should
be run.
B. In the U.S., there was originally one main
political party, the Federalist Party, led by
Alexander Hamilton.
C. When the Federalists were perceived as
overstepping their boundaries and imposing too
harsh a federal/elite power over the people, the
Democratic-Republican Party was formed.
I. When he won the 180 I election, Thomas
Jeffenon became the first President of this
new party.
2. This marked the start ofthe two-party system,
which became traditional in America.
D.After the War of 1812, the Federalists declined
and, until the 1824 election, the United States
was virtually a one-party system.
I. Andrew Jackson's 1824 rejected win of
the Presidency enraged many. He won a
plurality, but, due to numerous candidates,
not a majority. The House of Representatives
gave the office to John Quincy Adams.
2. In 1828, Jackson won a landslide victory,
but the people, still seething over the power

of "big government" to take charge of
the vote, formed the Whig Party (named
after the British party that represented the
"people," as opposed to the upper classes) in
opposition to the D-R, now called simply, the
Democratic Party. [NOTE: The first Whig
President, WiUiam Henry Harrison, died
within a month of his inauguration (1841),
and his V.P. and successor, John Tyler, was
historically inconsequential.]
E. The Whigs became a major, if never dominant,
force in politics. They did not become a majority
party because of the numerous factional parties
that were being formed at the time over a
number of "local" issues, and one overriding
national one: slavery.
F. By the I 850s, many of the smaller anti-slavery
parties had joined to form the new Republican
Party, which soon displaced the Whigs in
power, leading to their demise. The 1860
election of Republican Abraham Lincoln to
the Presidency solidified that party's standing.
G. The Republicans and Democrats have remained
the dominant parties, but there are still party
challengers.

I

I. In 1912, Theodore Roosevelt's Progressive
(a.k.a., Bull Moose) Party took enough votes

from Republican William Howard Taft to
assure the victory of Democrat Woodrow
Wilson.
2. In 1920, Socialist Party candidate Eugene
V. Debs garnered nearly I million votes.
He "campaigned" while in prison for his
Socialist activities.
3. In 1924, Progressive Party candidate Robert
M. La Follette secured 17% of the vote by
running on a platform of state ownership of
railroads and utilities.
H. Although there continued to be many small
parties running for office, their effect, at least for
the next 50 years or so, would be minimal due to
the Great DepressIon (and later, World War
II and other national and international events).
I. The collapse of the economy in 1929
brought many small factions together under
the Democratic banner. Franklin Delano
Roosevelt promised and initiated the New
Deal programs that overcame differences of
race, religion, sectionalism, etc., because ofthe
overriding need for jobs and survival.
I. It was at this time that the current images of
the two parties emerged:
a. Republicans as champions of capitalism,
growth, business, and the conservative
running of government.
b. Democrats as champions ofthe working c/ass,
minorities, human righL~, civil rightslliberties,

and the liberal running of government.
J. For over 50 years, there was no real challenge
to this two-party system.
I. The closest was the 1980 presidential run of
John B. Anderson as an Independent.
2. Although he made a credible showing in the
polls, he provided no real threat. Moreover, as
an Independent, he ran more as an individual
than as a representative of a party or platform.
K. In 1992, self-proclaimed "plain-speakin'"
billionaire Ross Perot got 19% of the vote in a
campaign he personally financed.
I . He then formed the Reform Party to challenge
both the Republicans and the Democrats.
2. While the Reform Party never gained any
presidential electoral votes, it did become a
national presence and succeeded in getting
several of its members elected to other
positions, most notably, Jesse Ventura as
Governor of Minnesota.
L. By the year 2000, dissatisfaction with the
two-party system brought about numerous
"third"-party challenges.
I . The Green Party of Ralph Nader was
among the most prominent.
2. The Libertarian Party, the Constitution
Party, and others have candidates for
President and V.P. in every election.
3. Although none of these gained more than 5%
of the vote (the standard for federal funding),

given the closeness of the election, they may
have had an effect on the outcome.
II. PARTY PLATFORMS
A. A statement of purpose that lays out the
party's goals for the future, its philosophyl
reason for being.
B. It is not meant to be a step-by-step plan
designed for immediate implementation, but
a general belief statement of how the party
would have things be in a perfect world.
C. Candidates who run under the party banner are
expected to subscribe to the majority ofplatform
points and the overall philosophy ofthe party.
D. They are not bound to implement every "plank"
in a platform, nor even subscribe to every
single one.
E. The platform is written by a committee made up
of members of the party. It operates in much the
same way as any other proposal committee.
I. They meet and present their p oints of view
on a given topic.
2. Then, they attempt to arrive at either a
consensus or compromise position on
disputed points.
3. Last, they vote on which points are added to,
subtracted from, or omitted completely from
the platform.
4. The majority vote rules.

III. THE POLITICS OF PARTY

A. Remember that the United States is a repubHc.
Each of its elected officials is, therefore, free to
vote his/her own mind and conscience regardless

of the ostensible "will" of the people who
elected himlher. He/she is also, by extension,

free to vote against the platform, or will, of the
party that supported himlher in the election.

B. Periodically, circumstances arise when

individuals may feel compelled to vote against

their own conscience and support the will of the

people/party.

I . During times of war, pacifists may vote for

increased military spending/operations.

2. A need to show a united front to a foreign

power may lead to votes that strengthen the

U.S. position even though, personally, those

against that position may feel it is wrong.

3. As the need for a national presence,
through advertising, exposure and influence
(which come with the need for the power,
organization and financing that only a strong
political party base can provide), grows ever
greater to win an election, many find they
must vote along strict party lines, regardless
of their individual beliefs.
C. Party politics may hold great power,
undercutting the ideals ofboth a republic and a
democracv.
D.Party Structures: Each party has committees
responsible for oversight of the geographical

area that their names imply. These committees

may have adjunct committees within them for

legislative, judicial or other oversight on each

level.

[NOTE: Oversillbt here means "overseeing, " not
"omission. ")
I. National Committee
2. State Committee
3. Congressional District Committee
4. County Committee
5. City Committee
6. Ward Committee

7. Precinct Committee
IV. THE ELECTORAL COLLEGE
A. Background
I. The people do not directly elect the President;

a

moreover, the presidential election is
national one.

2. Rather, it is a state-by-state election in

which we elect representatives in each state

who are "pledged" to a particular candidate.
3. The representatives then meet and cast their
states' electoral votes to elect the President.
B. Reasoned Discourse
I. It was assumed that, as each group of electors

met with those from other regions, they

would become aware of events/activities,

etc., in these regions.

2. This, in tum, might cause the electors to re­

evaluate whether their candidate would best

serve the nation as a whole.

3. Many states still allow their electors to do

this, while others require that electors vote as

mandated.

C. Framers of the Constitution
I. The fra mers of the Constitution, politicians

themselves, were fearful that events "of the

moment," an eloquent (but unscrupulous)

candidate, or any number of other factors.

might sway the populace ("the people") into

a "wrong" vote.

2. The electors, however, assumed to be

"educated citizens," would, in conference, be

able to see this problem and overcome it.


nm

BUREAUS, AGENCIES &

ORGANIZATIONS

As the United States has grown, adding new laws
and new commitments to the people, there has been a
parallel growth in the number ofbureaus and agencies
required to administer and oversee these laws and
commitments. While the heads of some of these
agencies may change with each new presidential
administration, the professional staffs that administer
each rarely change-assuring a continuity in both their
operation and effectiveness. Currently, the following
exist, their titles summing up their purpose:

ent's
astic

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Bureaus, Agencies & Organizations (continued)
Centers for Disease Control and Prevention (CDC) ­
under Department of Health and Human Services
j .,;;.,'

~
'II1II

Z

Central Intelligence Agency (CIA)
~. , I
[NOTE: The CIA is an independent u.s. government
agency that provides national security intelligence to
ranking government officials.]
Commodity Futures Trading Commission (CFTC)
a<.: ""

W Consumer Product Safety Commission (CPSC)

~

o

~

J

"',

Environmental Protection Agency (EPA) . \\, '1 .'"",)'.
Equal Employment Opportunity Commission (EEOC)
Federal Bureau of Investigation (FBI) - under
Department of Justice (001) " tb I " "
[NOTE: The FBI is the main investigative arm of
the D01.]
Federal Citizen Information Center (FCIC)
I'll

,ti,l ' ,

Federal Communications Commission (FCC)

Federal Deposit Insurance Corporation (FDIC)

Federal Home Loan Mortgage Corporation (Freddie Mac)
- placed under conservatorship of the Fedcral Housing
Finance Agency (FHFA). effective Sept. 7.2008
11

1,11'111,1

,'111

Federal National Mortgage Association (Fannie Mae)
- placed under conservatorship of the Federal Housing
Finance Agency (FHFA). effective Sept. 7, 2008
tl!.1 1111,\

Federal Maritime Commission (FMC)
"Illl' , •

Federal Trade Commission (FTC) ,
" . " .•.

Financial Industry Regulatory Authoriry (F1NRA)


~

Z

[NOTE:formerly, National Association ofSecurities
Dealers (NASD).]
Food and Drug Administration (FDA) - under Depart­
mentofHealth and Human Services " hl.l ",.
General Services Administration (GSA)
~I £0
National Aeronautics and Space Administration
(NASA)
1I:1S;1 ' "
National Credit Union Administration (NCUA)
1l1j,I"~

National Endowment for the Arts (NEA) ,
II '3~
National Health Information Center (NHIC) - under
Department of Health and Human Services

,It·.~,
W National
Institute of Standards and Technology (NIST)
IIhl

ft

- under Department of Commerce _ _"I I "" c
Yo National Institutes of Health (NIH) - under Department
of Health and Human Services , \I IIIIt e,2..'
National Labor Relations Board (NLRB) \\ ~

Nuclear Regulatory Commission (NRC) \I, w.nrc \,:0\
... Office of the Inspector General (OIG)
~v
~ Peace Corps 1 \ I" I \orill g('\
Postal Regulatory Commission \I
1" .,,,.

Securities and Exchange Commission (SEC)


O

.c;."

Small Business Administration (SBA) ,
Social Security Administration (SSA)
pi

Ii

lIl"Il

\I

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Surface Transport~tion Board (STB)-- under
Department of Transportation , , , rh ,j"r ,.,.,

United States Commission on Civil Rights (USCCR)
tl

!

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United States Postal Service (USPS)

\I '.

,'In

POST-9/11 GOVERNMENT
I. INTRODUCTION
A. September 11, 2001 (9/11) and subsequent
War on Terrorism have brought about many
changes in our governmental structure.
II. THE USA PATRIOT ACT
A. PATRIOT is an acronym for Uniting and
America
by
Providing
Strengthening
Appropriate Tools Required to Intercept and
Obstruct Terrorism.
B. 1t was passed into law on October 26, 200 I;
Public Law No: 107-56.
C. Historical O verview
1. 9/11 terrorist attack on the United States,

which resulted in approximately 3,000 deaths,
prompted public outcry for meaningful
legislation to prevent further similar acts.
2. 9/11 is considered to be the first significant
soil by a foreign entity since
attack on
the War of 1812.
a. The Civil War involved Americans vs.
Americans.
b. The Japanese attack on Pearl Harbor (WWII)
occurred before Hawaii was a state.

u.s.

3. Within a month of the attack, the Senate
passed S. 1510 (10111/01) and the House of
Representatives passed H.R. 2975 (10/ 12/0 I).
Both of these, along with provisions from
H.R. 3004 (Financial Anti-Terrorism Act).
were included in H.R. 3162, which became
the USA PATRIOT Act.
4. H.R. 3162. sponsored by Representative F.
James Sensenbrenner, was introduced on
October 23,2001 and passed on October 26,
2001 (a record time ofjust four daYS).
Ill. PASSING THE ACT
A.H.R. 3162 went through all the steps necessary
for passage into law, but. due to its extraordinary
circumstances, the process was expedited and
the act was passed with minimal changes.

IV. WHAT IS IN THE USA PATRIOT ACT?
A. The full act is over 160 pages. Below is a
sampling of some important changed aspects of
U.S. law after 9/1110 I.
B. Title 1- Enhancing Domestic Security against
Terrorism
I. Requires greater coordination/cooperation
between civilian authority (Attorney
General) and military (DOD) in the present
environment.
2. Authorizes development ofa national network
of electronic crimes task forces.
3. Expands presidential power to confiscate
property of suspected enemy aliens.
4. Allows for secret judicial review of classified
information or any matters that affect national
security.
C. Title II - Enhanced Surveillance Procedures
I. Broadens authority to wiretap and use other
electronic interceptions of communications.
2. Allows grand jury to share with federal
authorities previously secret evidence and
other protected materials.
3. Broadens government authority over
investigation and disclosure of previously
private communications.
4. Expands the scope of subpoenas for records.
5. Permits delay of notification of any of the
above actions. or others, if that notification
will hinder investigation.

6. Expands the number of district court judges
who can hear applications for such orders.
7. Broadens warrant scope and authority.
8. Provides penalties for unauthorized release
of information.
O. Title III - International Money Laundering,
Abatement and Anti-Terrorist Financing
I. Subtitle A: International Counter Monev
Laundering and Related Measures
.
2. Subtitle B: Bank Secrecy Act Amendments
and Related Improvements
3. Subtitle C: Currency Crimes
4. Designed to strengthen. expand, and/or
broaden the interpretation of new and existing
laws involving the use/misuse of funds for
both criminal and. especially. terrorist-related
activities.
E. Title IV - Protecting the Border
I . Subtitle A: Protecting the Northern Border
a. Authorizes expansion of manpower and
surveillance/investigation techniques.
b. Allows interdiction of potential threats to the
U.S. entering from Canada.
2. Subtitle B: Enhanced Immigration Provisions
a. Broadens the scope of acts which can lead to
either a denial of U.S. entry or deportation.
b. Broadens considerably the actions and
punishments available to law enforcement
and other agencies for "terrorist" activities.

c. Redefines certain formerly "criminal" acts!
activities as potentially "terrorist."
d. Places certain agencies. such as INS, under
Homeland Security authority.
e. Does not offer specific definitions of
"terrorist" actions, to maintain maximum
flexibility.
3. Subtitle C: Preservation of Immigration
Benefits for Victims of Terrorism

a. Preserves and enhances the rights of
immigrants who entered the U.S. on or before
9/ 11/01 whose life, lifestyle or status may
have been altered by the events of that day.
b. Establishes guidelines for investigation of
any claims based on the above.
c. Prohibits any benefits to terrorists or their
families.
F. Title V - Removing Obstacles to Investigating
T errorism
I. Authorizes substantial monetary rewards for
information on suspected terrorist activities.
2. Qualifies federal terrorism offenses as
meriting DNA identification and analysis.
3. Authorizes consultation/interchange of infor­
mation between investigative agencies regard­
ing electronic surveillance materials collected.
4. Allows FBI to request personal records of
individuals/organizations under criminal
investigation. if there is a perceived or alleged

terrorist component.
5. Revises Secret Service jurisdiction and
grants FBI authority over areas of fraud
and computer-related activities that might
fall under areas previously exclusive to the
Secret Service.
6. Allows for release of education records to
the Attorney General in cases of alleged
terrorism .
G. Title VI- Providing for Victims of Terrorism,
Public Safety Officers and Their Families
I. Subtitle A: Aid to Families of Puhlic SaferI'
Officers
. . .
2. Subtitle B: Amendments to the Victims of
Crime Act of 1984
3. Provides
expedited
and
increased
compensatory funds to individuals and/or
their families in the above groups who are
affected by terrorist acts. as opposed to purely
criminal acts covered previously.
H. Title VII- Increased Information Sharing for
Critical Infrastructure Protection
I. An amendment to the Omnibus Crime Control
and Safe Streets Act of 1968.
2. Extends additional Bureau of Justice funding
to law enforcement agencies for greater

collection/dissemination of information re:
terrorist acts/suspected acts.
I. Title VIII - Strengthening the Criminal Laws
Against Terrorism
I. Greatly expands both the definition of
terrorismlsuspected terrorism. and the reach
of the U.S. into foreign lands where U.S.
facilities. businesses. etc .. may be affected.
2. Grants the Attorney General much greater
authority over terrorist offenses both within
and outside of U.S. boundaries.
3. Removes the statute oflimitations on offenses
that either result in. or may have resulted in
(even if such did not occur). death or serious
bodily injury to another person.
4. Expands maximum penalties for terrorist
offenses.
5. Makes attempts or conspiracies to attempt
terrorism equal in penalty to successful acts
of terrorism.
6. Expands the authority of the RI CO (Racketeer
Influenced and Corrupt Organization) statute
to include terrorist activity.
7. Revises and strengthens penalties against
computer fraud as it applies to terrorism.
and provides additional funding to agencies
investigating same.
8. Prescribes new/strengthened penalties for
possession and/or delivery systems of certain
toxins and biological agents especially, but

not exclusively, among restricted persons.
J. Title IX -Improved Intelligence
I. Amends and expands the National Security
Act of 1947 and the Foreign Intelligence Act
of 1978 to direct the DCI (Director of Central
Intelligence) to share information with the
Attorney General; includes international
terrorism within the scope of the act.

NOTE TO STUDENT: This guide is intended for inf ormational purposes only. Due to its condensed format, it cannot poss ibly cover every aspect of
the subj ect. The in fo rmation contained in this gu ide is presented as a quick-reference overview of the U.S. Government. and is not intended (0 influence
readers' beliefs or opinions. BarCharts, Inc., its writers, editors and designers are not responsible or liable for the use or mi suse of the infonnrttion
contai ned in this guide. Furthermore, the information contained in this guide in no way expresses th e political views Or opiniolls 0/ BarCharts, Inc .. or
any ofits stajJ: AU information contained in this guide is up-to-date as of its writi ng.

S


Post-9/11 Government {continued)

2. Allows the Attorney General and other agencies
to defer required activity reports to Congress if it
is part of an ongoing investigation.
3. Requires the Attorney General to share with DCI
any foreign intelligence uncovered in a criminal
investigation.
4. Directs study of means to track finances/resources
of international terrorist organizations.
5. Allows the Attorney General to study feasibility
of a biometric identifier scanning system for use

at consular posts and all points of entry to U.S.
6. Authorizes interaction between Attorney General
and state/local authorities in areas near military
installations.
7. Amends Crimes Against Charitable Americans
Act of2001 to require phone solicitors to promptly
and fully disclose both the purpose of call and its
ramifications.
8. Places licensing of drivers who carry hazardous
materials under scrutiny of Secretary of Transpor­
tation and Attorney General, who will do back­
ground checks on applicants (if state requests it).
9. Directs grants to state and local facilities to
enhance preparation/response to terrorism .
10. Criticallnfrastructure Protection Act of2001

a. Defines "Critical Infrastructure"(CI) as:

"Systems and assets. whether physical or virtual.
so vital to the United States that their incapacity
or destruction would have a debilitating impact
on security. national economic security. national
public health or sqfety. or any combination of
those matters . ..

E. Responsible for threat aSSieSSiment

to the public based on

criteria at right.

F. Focuses on key areas:
I . Border &

Transportation

Security

2. Emergency

Preparedness &

Response

3. Science & Technology
4. Information Analysis

& Infrastructure

Protection

II. COMPONENTS OF THE DEPARTMENT O F
HOMELAND SECURITY
A. Office of the Secretary
Privacy Office

11 'I
Office for Civil Rights and Civil Liberties
hi

I tl\

11

II

Office of Inspector General
j;'
Office of Citizenship and Immigration Services Ombudsman
II

'I

h

I

II

I

II

11-1­

Office of Legislative AtTairs
I
htll1 'I
t I
Office of the General Counsel

db '(\
I II 1
Office of Public AtTairs·
Office of Countemarcotics Enforcement·
Office of the Executive Secretariat·
Military Advisor's Office·

•

b. Declares that any disruption of CI will be

"rare. brief. geographically limited in effect,
manageable. and minimally detrimental to the
economy. human and government services, and
u.s. national security. ..
c. Requires coordinated public/private partnership,
including corporate and non-governmental
organizations, to achieve the above.
d. Mandates a "comprehensive and effective program

...
'I11III

Z

to rnsure the continuity of essential Federal
Government jUnctions under all circumstances. ..

W
ft

1,1,
o~

~

e. Establishes the National Infrastructure
Simulation and Analysis Center (NISAC)
to support this continuity through studies of
counterterrorism, threat assessment and risk
m
_ _it_ig_a_t_io_n_.________________________~~~,

_____

,,

,

Office of Health AtTairs
Office oflntelligence and Analysis

~
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Federal Law Enforcement Training Center
Domestic Nuclear Detection Office
Il,;.'
tit I t l I
I
(I
Transportation Security Administration (TSA)

\

,

United States Customs and Border Protection (CBP)

DEPARTMENT OF HOMELAND SECURITY

United States Citizenship and Immigration Services

I. WHAT IS THE DEPARTMENT

OF HOMELAND SECURITY?

A. A Cabinet-level office designed to coordinate many
aspects of national security under one department,
assuring interchange of ideas and information.
B. Proposed (May 2, 2002) by a bipartisan group from
Senate and House as a response to growing evidence
that numerous agencies within the government had
pieces of information that, taken as a whole, might
have warned of the attack on 9/11.
C. Revised Bill H.R. 5005 introduced by Representative
Richard K. Armey on June 24, 2002.
D.Signed by the President (November 25, 2(02) ­
Public Law No: 107-296.

I

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United States Immigration and Customs Enforcement
I
(ICE)
United States Coast Guard (USCG)
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Federal Emergency Management Agency (FEMA)
1111 \1

31.2009).

U.S. $5.95

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Task Force on New Americans


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2. 9/14/08: Merrill Lynch agrees to be acquired
by Bank of America for $50 billion (half of its
valuation in 2(07).
3. 9/15/08: Dow Jones industrial average drops more
than 500 points (4.4%) as concerns of financial
crisis mount; it is the worst one-day loss since
9/ 11 . In addition. Lehman Brothers declares
bankruptcy when it fails to find a buyer.
4. 9/16/08: The F ederal Reserve agrees to an 585
billion rescue of the American International
Group (AI G). a huge insurer of financial
institutions.
5. 9/26/08:
Federal

regulators
seize
Washington Mutual, which is then
bought by JPMorgan Chase almost
immediately afterward. (Earlier. JPMorgan
Chase bought Bear Stearns, saving it from
bankruptcy.)
6. 9/29/08: Wachovia, the fourth largest U.S. bank
(by assets), agrees to divest all its banking
subsidiaries to Citigroup in an all-stock
transaction; the Federal Deposit Insurance
Corpora tion (FDIC) guarantees coverage of any
losses on the Wachovia banking portfolio greater
than $42 billion. in exchange for $10 billion in
preferred stock.
C. After debating the first version of the bailout plan
(amendment to H.R. 3997) brought to Congress
by President George W. Bush, the House rejected
~ (228 to 205); on the same day. the Dow
dropped 778 points - its biggest point decline to
I. A "sweetened" plan was brought back for debate
in Congress (amendment to H.R. 1424):
a. lncreases FDIC coverage per bank depositor
from $100,000 to 5250,000 (through December

1.>'

LLlUl

"crucial to avoid turmoil in the national and

international economies . ..

date.

Customer Hotline # 1.800.230.9522

6

and national security. so does the government' s
financial rescue plan reflect equivalently drastic
measures taken to attempt to prevent what has been
called a 'financial catastrophe. ..
III. WHAT IS THE GOVERNMENT FINANCIAL
RESCUE PLAN (A.K.A., "BAILOUT")?
A.The largest of its kind in U.S. history, this 5700
billion plan (officially called the Emergency
Economic Stabilization Act of 2008) does the
following:
I. G ives the U.S. Treasury unprecedented
authority to buy a wide range of troubled
financial assets.
2. Provides the federal government with an equity
stake in companies that participate in the plan.
but also limits executive pay.
3. Enables the federal government to recoup losses
from the financial industry after five years.
4. The plan became necessary after a series of events
throughout September 2008 that put U.S./global
financial markets in turmoil. largely brought
about by the subprime mortgage crisis.

B. Timeline of major events leading up to bai lout:
I. 9/7/08: U.S . government places Fannie Mae
and Freddie Mac, companies which, together.
hold more than 50% of the country's mortgages.
under government conservatorship (similar
to bankruptcy reorganization): Secretary of the
Treasury Henry M. Paulson, Jr.. calls the move

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ECONOMIC GLOBAliZATION
I. The 21" century presents many challenges to the United
States and the entire world. Along with globalization
come unparalleled concerns and difficulties regarding
the economy/financial markets.
[NOTE: Of equal significance are: the food supply.

climate change (global warming). health care. and
education-to name just some of the most significant
issues facing 21" century leaders- but addreSSing all
these issues is beyond the scope of this guide. so only
the issues that have resulted in notable changes to u.s.
legislation as ofthis writing are included here.)
II. Just as the PATRIOT Act and Department of
Homeland Security reflect drastic measures taken to
meet unprecedented national needs regarding terrorism

8

b.Gives 5150 billion in tax breaks to individuals
and companies.
c. Requires that employers and group health plans
provide equal insurance coverage for mental
health care as for physical care.
2. The Emergency Economic Stabili=ation Act of
2008. as approved by the House (263 to 171).
was signed into law by President Bush on
October 3. 2008.
D.On October 14. the Bush administration announced
plans to invest 5250 billion in nine of the largest
U.S. banks as part of its continued effort to

control the financial crisis and to enhance the
bailout paclmge.
E. Thereafter. came predictions of across­
the-board wage slumps that should be expected
throughout 2009.
F. As of this writing, global financial challenges
continue, and many experts call this the greatest
economic/financial crisis since the Great
Depression.