The Presidency Chapter 11 CHAPTER 11: THE PRESIDENCY The Presidency CHAPTER 11: THE PRESIDENCY In this chapter you will learn: See how the Constitution defines the presidency. Focus on presidential power. Learn what presidents do. Reflect on presidential popularity—and greatness. Consider the personal side of the office. Tour the Executive Office of the President, and meet the team around a president. CHAPTER 11: THE PRESIDENCY Defining the Presidency Three essential features about the American president: The president personifies America. More than any individual, presidents tell us who we are, and what we are becoming. The president injects new ideas into American politics. Our discussion of Congress emphasized the institution, the rules of the game; the presidency puts more focus on individuals and ideas. The president has enormous powers. That authority raises a fundamental question: Is the president too powerful for a democratic republic? Or is the office too weak to do what Americans demand of it? CHAPTER 11: THE PRESIDENCY Defining the Presidency Defined by Controversy Should the United States even have a president? Feared executive power Selected single president and established simple qualifications How long should the president serve? Debated settled on four year terms 1945 Twenty-Second Amendment limited presidents to two terms How should the United States choose its president? Electoral College Round about way of electing president Still debated: distorts popular vote CHAPTER 11: THE PRESIDENCY The President’s Powers Article 2 of the Constitution defines the presidency: Says very little about who the president is and what he/she does The president has three kinds of powers: expressed in the Constitution delegated by Congress inherent in the role of chief executive In theory, Congress passes laws and the president executes them. In reality, presidents constantly negotiate the limits of their power—which often expand during crises. CHAPTER 11: THE PRESIDENCY Expressed powers: Powers the Constitution explicitly grants to the president. Delegated powers: Powers that Congress passes on to the president. Inherent powers: Powers assumed by presidents, often during a crisis, on the basis of the constitutional phrase, “The executive power shall be vested in the president.” Executive privilege: Power claimed by the president to resist requests for authority by Congress, the courts, or the public. Not mentioned in the Constitution but based on the separation of powers. Executive agreements: an international agreement made by the president that does not require the approval of the Senate. Defining the Presidency The President’s Powers CHAPTER 11: THE PRESIDENCY The President’s Powers are Balanced by Congress CHAPTER 11: THE PRESIDENCY Is the President Too Powerful? Imperial Presidency Constant American theme: president has grown too mighty Presidents constantly redefine the authority of their office.

1. The Presidency
Chapter 11
CHAPTER 11: THE PRESIDENCY
The Presidency
CHAPTER 11: THE PRESIDENCY
In this chapter you will learn:
See how the Constitution defines the presidency.
Focus on presidential power.
Learn what presidents do.
Reflect on presidential popularity—and greatness.
Consider the personal side of the office.
Tour the Executive Office of the President, and meet the team
around a president.
CHAPTER 11: THE PRESIDENCY
Defining the Presidency
Three essential features about the American president:
The president personifies America.
More than any individual, presidents tell us who we are, and
what we are becoming.
The president injects new ideas into American politics.
Our discussion of Congress emphasized the institution, the rules
of the game; the presidency puts more focus on individuals and

2. ideas.
The president has enormous powers.
That authority raises a fundamental question: Is the president
too powerful for a democratic republic? Or is the office too
weak to do what Americans demand of it?
CHAPTER 11: THE PRESIDENCY
Defining the Presidency
Defined by Controversy
Should the United States even have a president?
Feared executive power
Selected single president and established simple qualifications
How long should the president serve?
Debated settled on four year terms
1945 Twenty-Second Amendment limited presidents to two
terms
How should the United States choose its president?
Electoral College
Round about way of electing president
Still debated: distorts popular vote
CHAPTER 11: THE PRESIDENCY
The President’s Powers
Article 2 of the Constitution defines the presidency:
Says very little about who the president is and what he/she does
The president has three kinds of powers:
expressed in the Constitution
delegated by Congress

3. inherent in the role of chief executive
In theory, Congress passes laws and the president executes
them.
In reality, presidents constantly negotiate the limits of their
power—which often expand during crises.
CHAPTER 11: THE PRESIDENCY
Expressed powers: Powers the Constitution explicitly grants to
the president.
Delegated powers: Powers that Congress passes on to the
president.
Inherent powers: Powers assumed by presidents, often during a
crisis, on the basis of the constitutional phrase, “The executive
power shall be vested in the president.”
Executive privilege: Power claimed by the president to resist
requests for authority by Congress, the courts, or the public.
Not mentioned in the Constitution but based on the separation
of powers.
Executive agreements: an international agreement made by the
president that does not require the approval of the Senate.
Defining the Presidency
The President’s Powers
CHAPTER 11: THE PRESIDENCY
The President’s Powers are Balanced by Congress

4. CHAPTER 11: THE PRESIDENCY
Is the President Too Powerful?
Imperial Presidency
Constant American theme: president has grown too mighty
Presidents constantly redefine the authority of their office
Powerful presidents become like emperors
Run roughshod over Congress
Issue secret decisions
Unilaterally deploy forces
Bypass checks and balances
Paradox: We need powerful leaders; we fear powerful leaders
CHAPTER 11: THE PRESIDENCY
Even under the best of circumstances, it’s difficult to get major
legislation through Congress because the president’s vetoes can
be overridden, and Congress retains the power of impeachment.
Is the Presidency Too Powerful?
A Weak Office?
CHAPTER 11: THE PRESIDENCY
What Presidents Do
Commander in Chief
Top Diplomat
First Legislator
Chief Bureaucrat
Economist in Chief

5. Head of State
Party Leader
CHAPTER 11: THE PRESIDENCY
Commander in Chief
“The president shall be the Commander-in-Chief of the Army
and Navy of the United States and the militia of the several
states…”
Congress passed the War Powers Act in 1973, requiring
congressional approval after troops have been deployed for 60
days.
Today, the president generally asks Congress for a resolution
supporting major military action.
Presidential powers have always waxed during wartime.
CHAPTER 11: THE PRESIDENCY
Top Diplomat
The Constitution gives presidents the lead role in foreign
affairs.
Presidents and their international advisers set an overall
framework for the US role in the world.
Some administrations emphasize international alliances; they
work closely with foreign powers and build multinational
institutions.
Others prefer to go it alone—they ignore the United Nations,
reject the idea of joint military action if American troops would
have to serve under foreign leaders.

6. CHAPTER 11: THE PRESIDENCY
The First Legislator
The Constitution includes presidents in the legislative process.
It authorizes them to:
Recommend measures for Congress’s “consideration.”
Report to Congress information on the state of the Union.
We can measure each president’s legislative success—generally
referred to as the “batting average .”
When the same party controls the White House and Congress,
known as unified government, the batting average is much
higher —usually around .800.
When the opposition party controls Congress (divided
government), the average usually falls below .500.
CHAPTER 11: THE PRESIDENCY
Veto power: The presidential power to block an act of Congress
by refusing to sign it.
Override. The process by which Congress can overcome a
presidential veto with a two-thirds vote in both chambers.
Presidents have 10 days to return the legislation to Congress
with a message explaining why he or she has rejected it. If the
president does nothing, the bill becomes law in ten days.
Signing Statements. These may offer the president’s
interpretation of the law—one sometimes at odds with
Congress’s expressed ideas.
What Presidents Do
The First Legislator (cont.)

7. CHAPTER 11: THE PRESIDENCY
Appointments. The Constitution gives the president the
power to appoint the men and women of the executive
branch of government, subject to confirmation by the Senate.
Today, the executive branch includes 15 departments and 2.7
million employees—or more than 4 million counting active-duty
military.
Presidents appoint some 4,000 political appointees who direct
the executive agencies.
The rest of the staff are civil servants who remain from one
administration to the next.
Executive Orders. This is a presidential declaration, with the
force of law, that issues instructions to the executive branch
without any requirement for congressional action or approval.
(The Supreme Court has the power, however, to overrule an
executive order found to be unconstitutional.)
What Presidents Do
Chief Bureaucrat
CHAPTER 11: THE PRESIDENCY
Trump’s Cabinet
https://en.wikipedia.org/wiki/Cabinet_of_Donald_Trump
CHAPTER 11: THE PRESIDENCY
Economist in Chief

8. Economic authority is one power the Constitution definitely
does not grant the president.
However, during the Great Depression of the 1930s, the
Roosevelt administration seized responsibility for putting the
nation back to work.
The year after Roosevelt died, Congress legislated a Council of
Economic Advisers (CEA) to help guide presidents’ efforts to
oversee the economy.
Every new administration crowds more economists into its
ranks.
CHAPTER 11: THE PRESIDENCY
Head of State
Dual role presidents play
Stand for the nation
Represent a party and a point of view
Presidents spend a lot of time in ceremonial role
First pitch at World Series
Spare a turkey at Thanksgiving
Light White House Christmas tree
CHAPTER 11: THE PRESIDENCY
Presidents must perform complicated balancing acts to avoid

9. charges of blatant partisanship (leveled by the other party) and
failing to adequately support their party colleagues.
What Presidents Do
Party Leader
CHAPTER 11: THE PRESIDENCY
Theodore Roosevelt called the
presidency itself a “bully pulpit” – an active president has the
country’s ear, an opening to introduce and promote new ideas.
Managing the public
Presidents try to manage public perceptions of the job they are
doing.
Approval ratings
They get immediate feedback from polling.
Presidential greatness
A president’s place in history, however, usually does not
emerge right away.
What Presidents Do
The Bully Pulpit: Introducing Ideas
CHAPTER 11: THE PRESIDENCY
No one person can juggle so many different presidential roles;
even great presidents cannot handle all their jobs well all of the
time.
What Presidents Do
The Impossible Job
CHAPTER 11: THE PRESIDENCY

10. Presidents develop a relationship with the people, which they
cultivate by going public—directly addressing citizens in order
to win support.
Presidential Leadership:
Success and Failure in the Oval Office
Managing the Public
CHAPTER 11: THE PRESIDENCY
Presidential Approval
CHAPTER 11: THE PRESIDENCY
Presidential Approval Ratings
CHAPTER 11: THE PRESIDENCY
Polls are used widely as a rough barometer of the
administration’s success.
Presidential Leadership:
Success and Failure in the Oval Office
Approval Ratings
CHAPTER 11: THE PRESIDENCY
The authors believe that great presidents redefine America; they
reshape the way the nation sees itself.

11. Presidential Leadership:
Success and Failure in the Oval Office
Presidential Greatness
CHAPTER 11: THE PRESIDENCY
Step 1: A New Order Rises. Outstanding leaders take over the
presidency and shake up the political system.
Step 2: The Order Refreshed. The ideas begin to look out of
date; the great coalition begins to unravel.
Step 3: The Old Order Crumbles. Over time, the party finds its
ideas increasingly irrelevant. The old order feels outdated, a
political dinosaur.
Presidential Leadership:
Success and Failure in the Oval Office
Greatness in Context: The Rise and Fall of Political Orders
CHAPTER 11: THE PRESIDENCY
James Madison was guided by a fierce attachment to the
Constitution that he had drafted and believed the office was
greater than the man.
Richard Nixon was brilliant—and often paranoid, traits that
helped him ratchet down the bitter cold war by playing off our
enemies against one another.
Ronald Reagan loved to tell stories and paint a gauzy vision of
American free enterprise.
The Personal Presidency
Presidential Style
CHAPTER 11: THE PRESIDENCY

12. 14 presidents and former presidents died during the twentieth
century.
11 passed away prematurely.
Eight of them fell more than seven years short of expected life
spans for men of their age.
The Personal Presidency
The Burden of the Office
CHAPTER 11: THE PRESIDENCY
The executive branch is like the solar system, with the president
as the sun and his appointees rotating around him.
The President’s Team:
A Tour of the White House
The Political Solar System: Presidential Appointments
CHAPTER 11: THE PRESIDENCY
Presides over the Senate and casts a vote in case
of a tie; otherwise, his responsibilities are entirely up to the
president.
The vice president
Traditionally, the vice president’s primary job was to stand in
the wings in case the president died.
Almost one in five presidents came to office after the death of
his predecessor.
Vice presidents preside over the Senate and cast a vote in case
of a tie.
The vice presidency became an important office since the Carter

13. administration.
In recent years, vice presidents are put in charge of major
administration efforts:
Dick Cheney managed the war on terror for President Bush.
Joe Biden has been a major voice on foreign policy for Barack
Obama.
The President’s Team:
A Tour of the White House
The Vice President
CHAPTER 11: THE PRESIDENCY
Members of the cabinet have two primary roles
Run executive-branch departments
Discuss policy with the president
Washington had four members, Lincoln had seven, today there
are fifteen
Cabinet meetings today largely ceremonial
Inner Cabinet
Rise above the rest and shape administration policy
Secretaries of State, Defense, Treasury, and Justice
The President’s Team:
A Tour of the White House
The Cabinet
CHAPTER 11: THE PRESIDENCY
The Office of Management and Budget (OMB). This is the most
powerful agency in the executive branch—it uses its authority
over the federal budget to manage the entire executive branch.

14. It has authority to review and “clear” anything a member of the
administration says or does in public.
The Council of Economic Advisers (CEA). The Council and its
chair keep an eye on the whole economy; CEA staff perform
economic analysis for the president: unemployment predictions,
productivity measurements, economic forecasts, etc.
The President’s Team:
A Tour of the White House
The Executive Office of the President
CHAPTER 11: THE PRESIDENCY
The National Security Council (NSC).
The NSC brings together the powerful officers who make
national security policy: secretaries of state, defense,
intelligence, and the treasury (economists again); the chair of
the Joint Chiefs of Staff; and others whom the president selects.
The national security advisor directs the council and must work
for consensus across all the different perspectives and
formidable personalities: diplomatic, military, and economic.
The President’s Team:
A Tour of the White House
The Executive Office of the President (cont.)
CHAPTER 11: THE PRESIDENCY
This group of four hundred or so advisors, aides, and associates
works directly for the president, most of them in the West
Wing.
At the center sits the Chief of Staff, the president’s gatekeeper,
traffic cop, and coordinator.

15. Other important offices include speechwriters, White House
counsel (the president’s official lawyer), and the legislative
affairs team.
Unlike the high-ranking members of the cabinet agencies, most
EOP staffers are not subject to Senate confirmation.
The President’s Team:
A Tour of the White House
The Heart of Power: The White House Office (WHO)
CHAPTER 11: THE PRESIDENCY
Traditionally, the “First Lady” role was simply that of hostess,
but Eleanor Roosevelt broke the traditional mold and pioneered
a new role: the First Lady as activist.
The President’s Team:
A Tour of the White House
The First Spouse
CHAPTER 11: THE PRESIDENCY
The First Spouse
Traditionally, the First Lady role was simply that of hostess.
Eleanor Roosevelt broke the traditional mold and pioneered a
new role: the First Lady as activist.
Lady Bird Johnson chose “beautification” of American cities
and highways.
Nancy Reagan became a spokesperson for the war on drugs.

16. Bill Clinton assigned his wife Hillary the signature policy
initiative of his presidency: national health care reform.
Hillary Clinton went on to a successful political career.
Michelle Obama is honorary chair of President Obama’s
signature White House Council for Community
Solution
s.
CHAPTER 11: THE PRESIDENCY
The Oval Office reverberates with power and responsibility, but
it is also full of limitations, checks, and balances.
Conclusion:
The Most Powerful Office on Earth?
CHAPTER 11: THE PRESIDENCY

17. The Military and How it Grew, 1820-2011
CHAPTER 11: THE PRESIDENCY
Presidential Vetoes and Overrides
in last 50 years
CHAPTER 11: THE PRESIDENCY
Presidential Job Approval
CHAPTER 11: THE PRESIDENCY
Is the President Too Powerful?
CHAPTER 11: THE PRESIDENCY

18. An Imperial Presidency?
Unitary executive theory. This view holds that the Constitution
puts the president in charge of executing the laws, and therefore
no one—not Congress, not the judiciary, not even the people—
may limit presidential power when it comes to executive
matters.
A Weak Office?
The presidents can seem weakest when they are trying to
advance domestic policy goals.
It is difficult to get major legislation through Congress. The

19. president nominally runs the executive branch, but the
bureaucracy is immense and often difficult to control.
Imperial presidency suggests the presidency is demonstrating
imperial traits and republic is becoming an empire.
A deep paradox in American politics: We need powerful
leaders; we fear powerful leaders.
What Do Presidents Do?
CHAPTER 11: THE PRESIDENCY
President

20. Commander in Chief
Top Diplomat
First Legislator
Chief Bureaucrat
Economist in Chief
Head of State
Party Leader
Obama’s Approval Rating for first 1,400 Days Compared to the
Average for Other Presidents
for the first 1,400 Days

21. CHAPTER 11: THE PRESIDENCY
Executive Orders Issued by Each President,
Per Day in Office
CHAPTER 11: THE PRESIDENCY
The President’s Powers Are Balanced
by Congress
CHAPTER 11: THE PRESIDENCY
Presidential Batting Average:
Measuring the Proportion of Congressional Bills
on Which the President Took a Position that Passed
CHAPTER 11: THE PRESIDENCY

22. Rating the Presidents: 5 Independent Polls
by Historians and Political Scientists
CHAPTER 11: THE PRESIDENCY
Rating the Presidents: 5 Independent Polls
by Historians and Political Scientists
CHAPTER 11: THE PRESIDENCY
Offices in the Executive Office of the President
CHAPTER 11: THE PRESIDENCY
STOCK EXCHANGES
A. In your own words, please identify two different stock

23. exchanges in the United States. Describe the similarities and
differences between the two stock exchanges. Identify one stock
from each of the two stock exchanges.
The two different stock exchanges in the United States are the
National Association of Securities Dealer Automated Quotation
(NASDAQ) and the New York Stock Exchange (NYSE). The
physical setting of both stock exchanges is the New York City.
The NYSE has narrowed down to the floor traders that complete
stock exchange in an auction market contrary to the NASDAQ
exchange whose operations are specialized mainly to the
automated trading as a dealer’s market. The NASDAQ was set
in the year 1971 while the NYSE was set up a year later. These
two constitute of the biggest stock exchanges globally with a
sum of roughly 4700 companies in their midst. The fees for
NYSE are relatively high compared to that of NASDAQ. NYSE
is likely to be associated with well-established companies such
as the Ford Motor Company while “high-tech stocks that are
more grow oriented and potentially volatile” such as Apple Inc.
are associated with the NASDAQ (Diffen,2017).
B. Using the two stocks you identified, determine the free cash
flow from 2013 & 2014. What inference can you draw from the
companies’ free cash flow?
(NYSE) Ford Motor Free Cash Flow: 2013 (in millions)
Free Cash Flow= Cash Flow from Operations- Capital
Expenditures

24. 3,847= 10,444- 6,597 (2013annualreport.ford.com, p.70)
Ford Motor Company Free Cash Flow: 2014 (in millions)
7,044= 14,507-7,463 (2014annualreport.ford.com, p.FS-6)
From this free cash flow, we are able to see that FORD had
more incoming money and thus could use more on capital
expenditure such as machinery, buildings, patents, land and
office equipment. There will also be the surplus amount of
money that can be used to expand the business as well as
maintaining it. An increase in free cash flow shows the progress
of Ford’s financial status and with this, Ford can “pursue
opportunities that enhance shareholder value” (Investopedia,
2017).
(NASDAQ) Apple Inc. Free Cash Flow: 2013 (in millions)
The full information of 10-K for 2013 isn’t given by Apple and
therefore it will be obtained from the 2014 10-K report.
Free Cash Flow= Cash Flow from Operations- Capital
Expenditures
37,069=53,666-16,597 (2014investor.apple.com p.35)
Apple Inc. Free Cash Flow: 2014 (in millions)
39,089= 57,713-20,624 (2014investor.apple.com p35)
From this free cash flow, it is also evident that Apple Inc. had
more incoming money and thus it could use it on capital
expenditure such as machinery, buildings, patents, land and
office equipment. There will also be the surplus amount of
money that can be used to expand the business as well as

25. maintaining it. An increase in free cash flow shows the progress
of Apple Inc.’s financial status and with this, Ford can “pursue
opportunities that enhance shareholder value” (Investopedia,
2017).
C. Using the 2016 & 2017 financial statements for both stocks,
prepare two financial ratios for each of the following
categories: liquidity ratios, asset management ratios, and
profitability ratios. You should have a total of six ratios for
each stock, per year. What challenges, strengths, or weaknesses
do you see? Please be articulate
Ford
Liquidity Ratios:
Current Ratio= Current Asset/Current Liabilities
2016: 108,461/90281= 1.20
2017:115,902/94,600=1.23
The ratio of Ford will tell us its capability to clear their debts
with their assets. If the ratio is less than 1.00 would mean that
the company is unable to clear their debts. From our
calculation, it is clear that Fords’ current ratio increase from
2016 to 2017 indicating that their debts decreased considerably
in comparison with their cash or assets. This means that the
company has no issues whatsoever in paying off their debts.
Quick Ratio= (Current Assets-Inventories)/ Current Liabilities
2016: (108,461-12266)/90281=1.07
2017: (115902-14166)/94600=1.08

26. With Ford’s quick ratio, we are able to know its available liquid
assets for the worth of every dollar of its current liabilities. In
this case, Ford has the required amounts of inventory to pay for
their current liabilities since the quick ratios for both years was
above 1.00. The liquidity of a company directly varies with its
quick ratio. If these quick ratios are anything to go by, then
Ford is a very liquid company.
Management Ratios
Debt ratio= Total Debt/Total Assets
2016: 142970/237951= 0.6=60%
2017: 154,287/257808=0.6=60%
The debt ratio shows the dependability rate of Ford to other
companies or lenders. The lower the percentage, the more
independent a company is.
Debt to Equity ratio= Total Debt/Total Common Equity
2016: 142970/29170=4.90
2017: 154287/34890= 4.42
The Ford debt-to-equity ratio is somewhat lower; this implies
that they have been somehow independent and thus they have
had a less aggressive reaction in financing their growth with
debt (Folger, 2017). Whenever there exists a high debt-to-equity
ratio then it means there is “greater potential for financial stress
if earnings do not exceed borrowed costs”. This argument is
supported by the situation when the United States government
received bailouts from automakers (Folger, 2017).

27. Profitability Ratios
Operating profit Margin= EBIT (Earnings Before Interest and
Taxes)/ Sales
2016: 7690/151,800=5.06%
2017: 9281/156776=5.92%
The operating profit margin shows the ability of a company to
“create value for their shareholders by generating operating
cash flow” (Investopedia, 2017). It shows the percent that the
company keeps per dollar such that for every 10 million that
ford earns, they would keep 5.06 percent of that which is the
same as $506,000. This margin increased in the subsequent year
meaning that the country will face fewer difficulties in catering
for their costs in the event of sales decline.
Gross profit= (sales-cost of goods sold)/sales
2016: (151800-128725)/151800=15.20%
2017: (156776-132892)/156776=15.23%
The gross profit margin for Ford measures how well it
operations are undergoing. There higher the percentage the
more smoothly the business is running.
Apple
Liquidity ratio
Current Ratio= current assets/current liabilities
2016: 106869/79006=1.35
2017: 128645/100814=1.27
Apple current ratio is higher compared to Apples, meaning it in

28. a better position to pay its debts with its assets.
Quick ratio= (current Assets-Inventories)/Current Liabilities
2016: (106869-2132)/79006= 1.32
2017: (128645-4855)/100814= 1.23
With Apple’s quick ratio, we are able to know its available
liquid assets for the worth of every dollar of its current
liabilities. The ratio is greater than one in both years and when
compared to Ford, Apple is more liquid.
Management Ratios
Debt ratio=Total Debt/Total assets
2016: 193437/321686=60.13%
2017: 241272/375319=64.28%
In comparison to Ford, Apple’s debt ratio shows that they are a
more independent company. They require less of borrowed
money.
Debt-to-equity-ratio= Total Debt/Total Common Equity
2016: 193437/128249=1.51
2017: 241272/134047=1.80
Apple’s debt-to-equity ratio of these two years is quite high,
meaning it borrowed highly from its owners.
Profitability Ratios
Operating profit margin= EBIT (Earnings Before Interest and
Taxes)/Sales
2016: 61372/215640=28.46%
2017: 64089/229230=27.96%

29. It is clear that Apple generates more cash compare to Ford. It
has well surpassed Ford in its operating profit margin thus it
will hold more money per dollar as compared to Ford. This
increases Apple value thus acts as a form of security during
low-profit seasons.
Gross Profit Margin= (sales-cost of goods sold)/sales
2016: (215640-131376)/215640= 39.08%
2017: (229230-141048)/229230=38.47%
The gross profit margin percentage for Apple is superb
reflecting on their efficiency.