ABSTRACT
For most of us, Washington, London, and Moscow are distant, yet what happens in these seats of power affects our lives. Public policy may seem distant, technical, far from democratic politics, shaped by policy wonks and bureaucrats. Yet the state is the dominant social organization, and its actions – “public policy” – shape our lives. American presidents raise or lower taxes and send the country to war – affecting prices, investment, interest rates, and jobs. States decide whether a firm is a monopoly, shaping consumer choice. Some states invest in or own companies, while others avoid direct ownership and let market forces sort things out. Perhaps the most visible policy is welfare. A minimum wage might raise labor costs and consumer purchasing by giving money to those with too little to spend. European welfare targets the middle class as well as the poor: cheap education and medical care that lower middle-class Americans dream of. When Britain’s Labor Party reintroduced university tuition in the late 1990s (universities were free), working-class children began to worry about the cost of university education. We must investigate how public policies emerge – and why, contrary to economists’ expectations, they continue to be different in different countries.
