4. Fiscal Federalism

Question 1

Fiscal federalism

Answer 1

How various levels of governments share responsibilities for various functions and raise resources. 

Question 2

1990 act that Provides a framework for federal spending

Answer 2

The budget and enforcement act

Question 3

Mandatory spending makes up this percentage of total spending

Answer 3

Approximately 70%

Question 4

Examples of Means tested spending

Answer 4

Medicaid, food stamps, family support assistance, SSI, children’s health insurance, veteran pensions

Question 5

Discretionary spending is what percent of total federal spending?

Answer 5

30% this includes national defense (50%) and non-defense discretionary (50%)

Question 6

True or false: national defense is more than half my federal budget.

Answer 6

False.

national defense is a little more than half of the discretionary budget which is only 30% of the total budget

Question 7

The very first power granted to congress in article 1 section 8 of the new constitution

Answer 7

Power to lay and collect taxes to pay the debts and provide for common defense and general welfare of the United States

Question 8

The last clause of article 1 section 8

Answer 8

To make all laws which shall be necessary and proper for carrying into the execution of the foregoing powers, and all other powers vested by this constitution in the government of the United States.

Question 9

10th amendment

Answer 9

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.

Also known as the Reserve Powers

Question 10

Article 1, section 10

Answer 10

Prohibits states from taxing imports or exports

Question 11

Article 1, section 9

Answer 11

Prohibits Congress from taxing articles exported from any state. Also prohibits Congress from taxing ships going between states

Question 12

Early sources of federal revenue

Answer 12

Exercise, tariff taxes, and the sale of Western lands

Question 13

Congress adopted a property tax in what year?

Answer 13

1798. But the tax was never put into effect. 

Question 14

In 1902 the federal government’s domestic spending was primarily for…

Answer 14

The postal service

Question 15

Historically, state government spent revenues on

Answer 15

Education, health, welfare, and corrections.

Question 16

Historically, local government spent revenues on

Answer 16

Police, fire, sanitation, education, and highways

Question 17

In 1902 the federal government spent this much on the Postal Service

Answer 17

$126 million. This was about 55% of total domestic federal spending

Question 18

In 1902 which level of government had the highest spending?

Answer 18

Local

Question 19

This event led to a need for greater and more reliable revenue sources, especially at the federal level

Answer 19

The great depression

Question 20

The 16th amendment did this

Answer 20

Authorized federal government to collect an income tax. This is generally thought of as a very efficient elastic and progressive tax. As personal wealth gross income tax receipts grow proportionally.

Question 21

How does the 16th amendment differ from the original language of the constitution with regard to apportionment

Answer 21

The original language of the constitution says the taxes shall be apportioned among several states. The 16th amendment stated that taxes can be collected without apportionment among the several states and without regard to any census

Question 22

More than half of federal revenue comes from

Answer 22

Individual income tax

Question 23

States top two types of revenue sources

Answer 23

Intergovernmental and sales tax

Question 24

Local governments top to revenue sources

Answer 24

Intergovernmental and property tax

Question 25

Examples of regressive taxes

Answer 25

Property taxes, sales taxes, user fees.

Question 26

True or false state and local government revenue sources or more regressive them federal sources

Answer 26

True

Question 27

The federal government transfers this amount to state and local governments annually

Answer 27

$690 billion

Question 28

Intergovernmental aid represents this percentage of all state and local revenue sources

Answer 28

35%

Question 29

Factors that impact the amount of federal aid a state receives

Answer 29

1. Population
2. Politics
3. Program specific-example is forestry
4. State effort-matching grants

Question 30

In 2018 the federal government issued 1274 grants what was the amount in terms of dollars?

Answer 30

$696 million this is about 17% of the federal budget 17% has remain stable since around 2005

Question 31

Between 1960 and 1980 the greatest proportion of grants went toward

Answer 31

Capital investment programs. Today most grants go to word income support programs.

Question 32

Three types of grants

Answer 32

1. Categorical/formula
2. Block
3. Revenue sharing (terminated in 86 by Reagan)

Question 33

Characteristics of categorical grants

Answer 33

Specific and narrowly defined purposes. Some are formula grants. Most are project grants.

Question 34

Three major effects of grants

Answer 34

1. Stimulative effect
2. Equalization of resources-compensates for regressive taxes
3. Expansion of control and influence

Question 35

Why did states comply with the .08 blood alcohol limit even if they did not agree

Answer 35

In order not to lose their Highway money