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Contemporary Public Policy

Learn how public policy is made, federal budget basics, and how to fairly analyze debates and data on immigration, environment, health and education.

Practice this skill 22 min Contemporary public policy Leer en español
Key idea

What you'll learn

This lesson explains how public policy is made and how to judge it fairly. Public policy is simply a government's plan for dealing with an issue. You will learn:

  • who makes policy at the federal, state and local levels;
  • the five stages of the policy cycle;
  • federal budget basics — the fiscal year, appropriations, mandatory vs discretionary spending, deficits and debt;
  • the main questions in four policy areas the GED likes: immigration, environment, healthcare and education;
  • how to read policy data, and how to separate facts, opinions and loaded language.

How it shows up on the GED: Expect a short article, two opposing viewpoints, a budget chart, or a data table about a policy. Questions may ask you to:

  • name a stage of policy-making,
  • figure a percent,
  • sum up each side's argument,
  • find common ground,
  • judge whether data supports a claim,
  • choose the most neutral description.

The GED never asks for your political opinion. It tests whether you can read evidence carefully and fairly.

Words to know

Key terms

  • public policy — a government's plan or course of action on an issue (a law lowering speed limits near schools).
  • stakeholder — a person or group affected by a policy (parents, drivers, firefighters).
  • regulation — a detailed rule written by a government agency to carry out a law (an EPA rule on air pollution).
  • executive order — an order from the President telling federal agencies how to carry out existing law.
  • fiscal year — the government's budget year. The federal one runs from October 1 to September 30.
  • appropriation — a law that sets aside money for a specific purpose.
  • mandatory spending — spending that existing law requires, unless Congress changes the law (Social Security, Medicare).
  • discretionary spending — spending Congress decides each year (defense, education grants, highways).
  • budget deficit / surplus — deficit: spending more than you take in during a year. Surplus: taking in more than you spend.
  • national debt — the total amount the federal government owes from past borrowing.
  • trade-off — giving up one benefit to gain another (safer streets vs slightly slower ambulances).
  • correlation / causation — correlation: two things change together. Causation: one thing actually makes the other happen.
  • loaded language — words chosen to stir feelings or pass judgment ("reckless," "heroic").
  • neutral — not taking a side; describing each view fairly.

All Social Studies words in the glossary

1. Who makes public policy?

In plain words: Many people and groups shape policy, not just Congress.

Think of how a new rule gets made at work. A manager may propose it. The owner approves it. HR writes the details. Workers may push back. Government policy works much the same way, with many hands involved.

ActorHow it shapes policyExample
CongressPasses laws and appropriations; holds hearingsA law funding highway repairs
PresidentProposes a budget, signs or vetoes bills, issues executive orders, directs agenciesThe annual budget request
Federal agenciesWrite regulations after publishing proposals and taking public commentsEPA, Department of Education
CourtsDecide whether laws and rules follow the Constitution and the lawStriking down a rule that exceeds an agency's authority
States and localitiesMake policy on schools, policing, roads, licensing and moreA city's speed limits
Citizens, interest groups, mediaRaise issues, lobby, comment on rules, voteA petition to a city council
Hub diagram of who shapes public policy. Arrows point to public policy from six actors: Congress passes laws and appropriations; the President proposes a budget, signs or vetoes bills and issues executive orders; federal agencies write regulations; courts rule on whether laws and rules are legal; states and cities make policy on schools, police and roads; citizens, interest groups and the media raise issues, lobby and vote.Many Hands Shape PolicyPUBLIC POLICYCongresslaws, appropriationsPresidentbudget, vetoes, exec. ordersFederal agencieswrite regulationsCourtsrule on legalityStates and citiesschools, police, roadsCitizens, groups, mediaraise issues, lobby, vote

Federalism shares the work. Under federalism, power is split between the nation and the states. Two examples:

  • The Constitution gives Congress power over naturalization — how immigrants become citizens. So immigration law is mainly federal.
  • Public schools are run mostly by states and local school districts. Most K–12 money comes from state and local sources.
Two examples of federalism in policy. Federal government: immigration law is mainly federal because the Constitution gives Congress power over naturalization, and the Department of Homeland Security enforces it. State and local governments: K–12 public schools are run mostly by states and local districts, and most K–12 money comes from state and local sources. Federal programs add some money for low-income schools and students with disabilities.Federalism Shares the Policy WorkFEDERAL governmentSTATE and LOCAL governmentsImmigration law is mainly federal:the Constitution gives Congresspower over naturalization.Homeland Security enforces it.K–12 public schools are run mostlyby states and local districts.Most K–12 money comes fromstate and local sources.Federal programs add some school money (low-income schools, students with disabilities).

2. The policy cycle

In plain words: Policy-making moves in a circle of five steps.

Think of fixing a pothole on your street. First, people complain about it. Then the city looks at ways to fix it. Next, someone approves a plan. Then a crew does the work. Later, someone checks if the fix held up. If not, the cycle starts again.

Political scientists — people who study government — describe policy-making as a cycle of five stages:

  1. Agenda setting — a problem gets public attention. This can come from news stories, a crisis, a petition or data.
  2. Formulation — officials and experts draft possible solutions and estimate costs.
  3. Adoption — an official body approves one option. A legislature votes, an agency issues a final rule, or a mayor signs.
  4. Implementation — agencies put the policy into action. They hire staff, write regulations and enforce rules.
  5. Evaluation — results are measured. The policy may be kept, changed or ended. This can start the cycle again.

Example:

  • Congress passes a law to reduce lead in drinking water. (adoption)
  • The Environmental Protection Agency then writes detailed rules for water systems. (implementation)
  • Years later, studies measure lead levels. (evaluation)
The five policy-cycle stages in a row, with the lead-in-drinking-water example. 1 agenda setting and 2 formulation come first. 3 adoption: Congress passes a law to reduce lead in drinking water. 4 implementation: the EPA writes detailed rules for water systems. 5 evaluation: years later, studies measure lead levels. A dashed arrow from evaluation back to agenda setting shows that results may restart the cycle.The Policy Cycle: Lead in Drinking Water1. Agenda setting(lead in watergets attention)2. Formulation(options drafted,costs estimated)3. AdoptionCongress passesa law to reducelead in water4. ImplementationEPA writesdetailed rules forwater systems5. EvaluationYears later, studiesmeasure lead levelsresults may put the issue back on the agenda

The policy cycle

Diagram of the policy cycle as a loop of five stages: 1 Agenda setting (a problem gets public attention), 2 Policy formulation (officials draft possible solutions), 3 Adoption (a legislature, agency or executive officially approves a policy), 4 Implementation (agencies put the policy into action), 5 Evaluation (results are measured), with an arrow from Evaluation back to Agenda setting. 1. Agenda setting problem gets attention 2. Formulation draft solutions 3. Adoption official approval 4. Implementation put into action 5. Evaluation measure results

Each stage leads to the next, and evaluation can put an issue back on the agenda.

3. Federal budget basics

In plain words: Congress controls the money. The budget year starts October 1. Most spending is set by existing law.

Think of a household budget. You plan what comes in and what goes out. Some bills are fixed, like rent. Others you choose each month, like eating out. The federal budget has the same two kinds of spending.

Congress controls the money. The Constitution gives Congress the power of the purse — control over government money:

  • Bills to raise money must start in the House (Article I, Section 7).
  • "No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law" (Article I, Section 9). In plain words, the government cannot spend money unless a law allows it.

The yearly process:

  1. The President sends Congress a budget request, usually early in the calendar year.
  2. Congress writes a budget plan. It passes appropriations bills that fund agencies.
  3. The fiscal year starts October 1. If appropriations are not passed, Congress may pass a short-term continuing resolution to keep money flowing. If it does neither, parts of the government shut down.
Timeline of the federal budget year across January to December. Quote from Article I, Section 9: No money shall be drawn from the Treasury but in consequence of appropriations made by law. 1, early in the calendar year the President sends a budget request. 2, Congress writes a budget plan and passes appropriations bills. October 1 begins the new fiscal year, which runs from October 1 to September 30. 3, if appropriations are not passed by October 1, Congress may pass a continuing resolution, or parts of the government shut down.The Federal Budget YearJanFebMarAprMayJunJulAugSepOctNovDecOne calendar yearOct 1: new fiscal year beginsfiscal year runs Oct 1 → Sep 301. President sendsbudget request2. Congress writes a budget plan, passes appropriations bills3. Not passed by Oct 1? Continuing resolution, or parts of government shut down"No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law"

Where the money goes:

  • Most federal spending is mandatory. These are programs such as Social Security, Medicare and Medicaid that run under existing law. They are like rent: fixed unless the rules change.
  • Social Security is the largest single program.
  • Interest on the national debt is another large and growing cost.
  • Discretionary spending is decided each year. It includes defense, education grants, transportation and scientific research.
Tree of federal spending. Mandatory spending, the largest share, is set by existing law: Social Security, the largest single program, Medicare, and Medicaid. Interest on the national debt is large and growing. Discretionary spending is decided each year: defense, education grants, transportation, and scientific research. Money comes in mainly from the individual income tax, the largest source, then payroll taxes, then corporate income taxes.Where Federal Money GoesFederal spendingMANDATORY (most)set by existing lawSocial Security (largest)MedicareMedicaidINTERESTon the national debtlarge and growingDISCRETIONARYdecided each yeardefenseeducation grantstransportationscientific researchMoney in: individual income tax (largest), then payroll taxes, then corporate income taxes.

Where the money comes from:

  1. The individual income tax is the largest source.
  2. Next come payroll taxes, which fund Social Security and Medicare.
  3. Then come corporate income taxes.

Deficit vs debt:

  • A deficit is a one-year gap: spending is more than revenue (money coming in).
  • The debt is the running total of all past borrowing.
  • Each deficit adds to the debt, like unpaid charges adding to a credit card balance.
Stacked bars with made-up numbers in trillions of dollars. The debt starts at 10. Year 1 deficit of 2 raises the debt to 12; year 2 deficit of 3 raises it to 15; year 3 deficit of 1 raises it to 16; year 4 deficit of 2 raises it to 18. The deficit is one year's gap, shown in red; the debt is the running total of all past borrowing, the whole bar.Deficit vs. DebtMade-up numbers (trillions of dollars) to show the ideadebt 12+2 deficitYear 1debt 15+3 deficitYear 2debt 16+1 deficitYear 3debt 18+2 deficitYear 4start: 10Deficit = one year's gap (red). Debt = running total of all past borrowing (whole bar).

4. Four policy areas — the main questions

In plain words: Know what each debate is about and why each side holds its view. You do not have to pick a winner.

The GED expects you to understand the main question in each debate and the reasons each side gives.

Immigration (mainly federal). Congress writes immigration law. The Department of Homeland Security enforces it. Debates include:

  • how many people to admit legally, and for what reasons (family, jobs, refuge),
  • how to secure the border,
  • what to do about people living in the U.S. without legal status.
Supporters of more immigration often stressSupporters of stricter limits often stress
labor needs and keeping families togetherenforcing the law, security and effects on wages

Environment. The Environmental Protection Agency (created 1970) carries out laws such as the Clean Air Act and the Clean Water Act.

  • Supporters of stronger rules point to benefits for health and the environment.
  • Critics point to costs for businesses and consumers, and to effects on jobs and energy prices.
  • Many debates are about how to balance these.

Healthcare.

  • Medicare (for people 65 and older) and Medicaid (for many low-income people) were created in 1965. Medicaid is run jointly by the federal government and the states.
  • The Affordable Care Act (2010) created insurance marketplaces with subsidies (government help paying the cost). It also let states expand Medicaid.
  • Debates focus on cost, coverage, quality, and how big a role government should play compared with private businesses.

Education. States and local districts run most public schools. Federal programs add money for low-income schools and for students with disabilities. Debates include:

  • school choice,
  • how to fund schools fairly,
  • how to measure results through testing.

5. Analyzing policy neutrally and reading policy data

In plain words: Stick to the evidence. Notice slanted words. Don't assume one thing caused another just because it came first.

Use this checklist for any policy source:

  • What problem is the policy meant to solve? Who are the stakeholders?
  • What does each side claim? What reasons and evidence support each claim?
  • Fact or opinion?
    • A fact can be checked ("collisions fell from 9 to 4").
    • An opinion is a judgment ("the best plan").
    • A prediction ("will drain schools") is a claim to be tested, not a fact.
  • Loaded language: words like reckless, heroic, rescue or rightly show a point of view.
  • Trade-offs: almost every policy has costs as well as benefits.
  • Correlation vs causation: say something changed after a policy began. Ask what else changed. Ask whether a comparison group without the policy changed too. (Example: sales went up after a store's new ad — but it was also the holiday season.)
  • Read the data carefully: check the title, the units (millions? percent?), the years, and where the axis starts.
Formula

Policy math you may need

\text{Percent of total} = \dfrac{\text{part}}{\text{whole}} \times 100 \text{Percent change} = \dfrac{\text{new} - \text{old}}{\text{old}} \times 100 \text{Per capita (per person)} = \dfrac{\text{total}}{\text{population}}

The Social Studies test has no formula sheet, so memorize them. A negative percent change means a decrease. You can use the on-screen calculator for Social Studies questions that need math.

Worked example

Worked example 1 — Identify the stage

Source: "After Congress passed a law requiring cleaner school buses, the Environmental Protection Agency published a proposed rule, collected public comments for 60 days, and then issued final standards that bus makers must meet."

Question: The EPA's actions are part of which stage of the policy cycle?

A. Agenda setting B. Adoption by Congress C. Implementation D. Evaluation

Think-aloud:

  1. The law was already passed. Adoption by Congress is done, so B is an earlier step.
  2. The EPA is turning the law into specific rules that can be enforced. That is putting the law into action.
  3. No results are being measured yet. So it is not evaluation.
The five policy-cycle stages with the school-bus example. Adoption is already done: Congress passed the law. Implementation is highlighted: the EPA published a proposed rule, took 60 days of public comments, and issued final standards. Evaluation has not happened: no results measured yet. Writing rules to carry out a law is implementation, answer C.Worked Example 1: Which Stage?1. Agenda setting2. Formulation3. AdoptionCongress alreadypassed the law4. ImplementationEPA: proposed rule,60 days of comments,final standards5. Evaluation(no resultsmeasured yet)Writing rules to carry out a law = IMPLEMENTATION (answer C)

Answer: C. When agencies write rules to carry out a law, that is implementation.

Worked example

Worked example 2 — Budget percent and per capita

Source: The fictional town of Riverbend has 16,000 residents and an $8 million budget. Police receive $2.4 million.

Question: What percent of the budget goes to police, and how much does the town spend on police per resident?

Think-aloud:

  1. Percent: \dfrac{2.4}{8} \times 100 = 0.3 \times 100 = 30\%.
  2. Per capita: \dfrac{\$2{,}400{,}000}{16{,}000} = \$150 per resident.
  3. Check units: both numbers in step 1 are in millions, so they cancel.
Bar of Riverbend's 8 million dollar budget, to scale. Police get 2.4 million dollars, 30 percent of the bar; everything else is 5.6 million dollars. Percent: 2.4 divided by 8 times 100 equals 30 percent. Per capita: 2,400,000 dollars divided by 16,000 residents equals 150 dollars per resident. Use the whole budget as the denominator.Worked Example 2: Riverbend's BudgetPolice $2.4MEverything else $5.6M$0M$1M$2M$3M$4M$5M$6M$7M$8MWhole budget = $8 millionPercent: 2.4 ÷ 8 × 100 = 30%Per capita: $2,400,000 ÷ 16,000 residents = $150 per residentUse the WHOLE budget as the denominator for a percent of total.

Answer: 30%, or $150 per resident.

Worked example

Worked example 3 — Fact, opinion and both sides

Source (fictional speakers): A farm owner: "Our county's farms reported 300 unfilled jobs last harvest, according to a county farm bureau survey. Expanding temporary worker visas is the smartest fix." A union member: "More temporary workers could hold down wages for people who already live here. Employers should raise pay first."

Question: Which statement is a fact that could be checked?

A. Expanding visas is the smartest fix. B. The farm bureau survey reported 300 unfilled jobs. C. Employers should raise pay first. D. More temporary workers could hold down wages.

Think-aloud:

  1. A and C use judging words (smartest, should) → opinions.
  2. D is a prediction (could) — reasonable to debate, but not a checked fact.
  3. B names a number and a source we could look up → fact.
Sorting chart for Worked Example 3. Fact, can be checked: B, the farm bureau survey reported 300 unfilled jobs; signal is a number and a source. Opinion, a judgment: A, expanding visas is the smartest fix, and C, employers should raise pay first; signals are smartest and should. Prediction, to be tested: D, more temporary workers could hold down wages; signals are could and will. Answer: B.Worked Example 3: Fact, Opinion, or Prediction?FACT (can be checked)B. The farm bureau surveyreported 300 unfilled jobs.signal: number + sourceOPINION (a judgment)A. Expanding visas is thesmartest fix.C. Employers should raisepay first.signal: smartest, shouldPREDICTION (to be tested)D. More temporary workerscould hold down wages.signal: could, willAnswer: B. A fair summary gives each side's reason.

Answer: B. Notice that the source gives each side one reason; a fair summary would include both.

Worked example

Worked example 4 — Correlation is not causation

Source: A fictional school district began a free school-breakfast program in 2019. Average attendance was 91% in 2018 and 94% in 2021. The same district also hired more bus drivers in 2020.

Question: Which conclusion is best supported?

A. The breakfast program caused attendance to rise. B. Attendance rose after the program began, but other changes, such as more bus drivers, could also explain it. C. The program failed. D. Attendance would have fallen without the program.

Think-aloud:

  1. The data show attendance went up after the program started (correlation).
  2. Another change happened at the same time (bus drivers), so we cannot be sure which caused the rise.
  3. A and D claim more than the data show; C contradicts the data.
Line chart of a district's average attendance with the axis starting at 90 percent. Attendance was 91 percent in 2018 and 94 percent in 2021; 2019 and 2020 values are not given, so a dashed line connects the two points. Two vertical markers show changes: the breakfast program began in 2019 and more bus drivers were hired in 2020. Two changes came before the rise, so the data alone cannot show which caused it.Worked Example 4: Correlation Is Not Causation90%91%92%93%94%95%2018201920202021Average attendance(vertical axis starts at 90%)91%94%2019: breakfast program2020: more bus driversTwo changes came before the rise; the data alone cannot show which caused it.

Answer: B. To test cause, compare with a similar district that did not start the program.

Common mistake

Common mistakes

  • Mixing up adoption and implementation. Wrong: "The agency writing rules is adoption." Right: adoption is the official approval; carrying it out (including writing rules) is implementation.
  • Confusing deficit and debt. Wrong: "The debt is this year's shortfall." Right: the deficit is one year's gap; the debt is the total of all past borrowing.
  • Using the wrong whole in a percent. Wrong: roads ÷ public safety. Right: roads ÷ total budget.
  • Treating a prediction as a fact. Wrong: "The bill will drain schools" is a fact. Right: it is a claim that needs evidence.
  • Assuming cause from timing. Wrong: "Prices rose after the rule, so the rule caused it." Right: check a comparison group and other factors.
  • Picking the answer you agree with. Wrong: choosing a side's argument because it matches your views. Right: choose what the source says or supports.
Test strategy

GED strategy for public-policy questions

  1. Read the question first so you know whether you need a stage, a number, a summary or a comparison.
  2. Label each viewpoint in a few words ("Whitfield: choice + competition" / "Hale: costs + accountability").
  3. For "both agree" questions, confirm the idea in each source; one-sided ideas are the usual traps.
  4. For data, check title, units, years and axis start; compute instead of eyeballing when bars or slopes look similar.
  5. For cause claims, look for a comparison group or other explanations.
  6. For neutrality questions, prefer sentences with attribution ("supporters say…") and no judging adjectives.
  7. Keep your own views out. The best answer is the one the evidence supports.

Check yourself

Contemporary public policy
How Brookside Made a School-Zone Safety Policy

(1) In the fictional city of Brookside, parents complained for months about speeding cars near two elementary schools. After a child was struck by a car and injured, a local news story and a petition with 1,200 signatures brought the problem to the city council's attention.

(2) The council asked city staff to study the problem. Staff proposed three options: lowering the speed limit near schools from 30 to 20 miles per hour, adding speed bumps, or installing speed cameras. Staff estimated the cost of each option.

(3) In March, the council voted 5–2 to lower the speed limit in school zones and to add speed bumps on four streets. The two members who voted no said speed bumps would slow down fire trucks and ambulances.

(4) Over the summer, the public works department installed new signs and speed bumps, and the police department began enforcing the new limit.

(5) One year later, city staff reported to the council. Average speeds in the school zones fell from 31 to 23 miles per hour, and collisions near the schools fell from 9 to 4. Fire department response times on those streets rose by an average of 15 seconds. The council will use the report to decide whether to keep, expand or change the policy.

Which stage of the policy-making process is described in paragraph 5?

Answer choices
Hint

In paragraph 5, the policy is already in place. What are city staff doing with it?

Check yourself

Contemporary public policy
The Constitution and the Power of the Purse

Article I of the Constitution gives Congress control over federal taxes and spending, often called the "power of the purse."

(1) Article I, Section 7: "All Bills for raising Revenue shall originate in the House of Representatives; but the Senate may propose or concur with Amendments as on other Bills."

(2) Article I, Section 8: "The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States;"

(3) Article I, Section 8 (continued): Congress shall have power … "To establish an uniform Rule of Naturalization, and uniform Laws on the subject of Bankruptcies throughout the United States;"

(4) Article I, Section 9: "No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law; and a regular Statement and Account of the Receipts and Expenditures of all public Money shall be published from time to time."

According to paragraph 4, what must happen before money can be spent from the U.S. Treasury?

Answer choices
Hint

Find the words "No Money shall be drawn from the Treasury, but …". What comes after but?

Summary

  • Policy is shaped by Congress, the President, agencies, courts, states and cities, and citizens.
  • The policy cycle: agenda setting → formulation → adoption → implementation → evaluation.
  • Congress holds the power of the purse. The fiscal year starts October 1.
  • Most federal spending is mandatory. Social Security is the largest program.
  • Deficit = one year's gap. Debt = the total owed.
  • In debates on immigration, environment, healthcare and education, find each side's claim, reasons and evidence. Do not take sides.
  • Use percent of total, percent change and per capita.
  • Separate fact, opinion and prediction. Never assume cause from timing alone.
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