The Budget

Question 1

deficit

Answer 1

an eccess of federal expenditures over revenues for one year

Question 2

budget

Answer 2

a policy document allocating burdens (taxes) and benefits (expenditures)

Question 3

expenditures

Answer 3

government spending of revenues

Question 4

revenues

Answer 4

the financial resources of the government

Question 5

sources of federal revenue

Answer 5

income tax 
Social Insurance (social security and medicare)
borrowing
excise taxes (retail)
corporate income taxes

Question 6

income tax

Answer 6

shares of individual wages and corporate revenues collected by the gov’t

Question 7

16th amendment

Answer 7

authorizes congress to levy an income tax

Question 8

progressive tax

Answer 8

tax rates increase with income

Question 9

flat tax

Answer 9

flat tax rate for everyone

Question 10

social insurance taxes

Answer 10

(social security and medicare)

money is deducted from employees paychecks and matched by employers for elderly, displayed, unemployed, widows, etc.

Question 11

borrowing

Answer 11

treasury department sells bonds to citizens, corporations, institutions and other governments often used for day to day needs (dependent)

Question 12

federal debt

Answer 12

all the money borrowed by federal gov’t over the years & still outstanding today

Question 13

Tax expenditures

Answer 13

revenue loses that result from special exemptions, exclusions or deductions on federal law
-charitable contributions
-mortgage interest
-business expences
benefits middle & upper class corporations

Question 14

Tax Reductions

Answer 14

in 1981 Regan passed huge tax reduction policy to cut taxes, but it mainly helped higher income families and contributed to deficits in the 80s and 90s

Question 15

Tax Reform Act 1986

Answer 15

-reduced value of tax deductions
-removed low-income individuals
from the tax rolls
-changed from 15 separate brackets to two lower rates
(later added more higher brackets)

Question 16

military industrial complex

Answer 16

relationship between military establishment and technology

Question 17

national security state

Answer 17

cold war results in permanent military establishment and increased until the 80s and came back after 9/11
1/5 of the budget
(veterans, pentagon, research, etc)

Question 18

Social Service State

Answer 18

largest portion of the budget

education, environment, minorities, poverty, hospitals

Question 19

Social Security Act

Answer 19

a law passes in 35 during the great depression that was intended to provide a minimal level of sustenance to older americans

Question 20

medicare

Answer 20

a program added to the social security system in 65 that provides hospitalization insurance for the elderly and permits americans to purchase inexpensive coverage for doctor fees and other health expenses

Question 21

social security trust fund depletion

Answer 21

more old people and less workers to support them so it has become more of a burden to pay for social security

Question 22

Incrementalism

Answer 22

a description of the budget process where the best predictor of this year’s budget is last year’s budget plus a little extra (an increment) “most of the budget is a product of previous decisions”

Question 23

Uncontrollable Expenditures

Answer 23

expenditures that are determined not by a fixed amount of money appropriated by congress but by how many eligible beneficiaries there are for a program or by previous obligations of the gov’t

Question 24

entitlements

Answer 24

policies for which congress has obligated itself to pay X level of benefits to Y number of recipients (social security benefits)

Question 25

cause of incrmentalism

Answer 25

policymakers don’t focus on the base and more on the amounts of money agencies have
agencies get the same money as last year
most debate is focused on the increment
budgets tend to grow

Question 26

strategies

Answer 26

everyone has strategies like asking for more money, interest groups advocate, etc.

Question 27

players: interest groups

Answer 27

work with agencies to advocate for their interests

Question 28

players: agencies

Answer 28

push for higher requests and send to OMB and president

Question 29

players: OMB

Answer 29

responsible to the president but make major decisions

Question 30

players: President

Answer 30

makes final decisions and tries to keep congress close to recomendations

Question 31

players: Tax committees in congress

Answer 31

create taxes used to spend money House Ways and Means Committee and Senate Finance Committee

Question 32

players: CBO

Answer 32

Congressional Budget Office
congress equivalent of OMB and sets parameters of congressional budget process (limits, examining expenditures and revenues)

Question 33

players: subject matter committees

Answer 33

want larger budgets for related agencies

Question 34

players: appropriations committees

Answer 34

decides who gets what in each house

takes new and old policies & decides how much to spend and does hearings for agencies

Question 35

players: congress

Answer 35

approves taxes and appropriations

Question 36

players: GAO

Answer 36

Government Accountability Office

audits, monitors, and evaluates agencies

Question 37

House ways and Means Committee

Answer 37

In the House

with the senate finance committee writes the tax codes and is subject to congresses approval

Question 38

Senate Finance Committee

Answer 38

with the House ways and Means Committee writes the tax codes and is subject to congresses approval

Question 39

Budget and Accountability Act

Answer 39

required president to propose an executive budget to congress and created the Bureau of the Budget. it was reorganized and named the OMB

Question 40

preparation of the budget

Answer 40

starts a year in advance and must be submitted the first Monday in February
the OMB communicates with the president and agencies to prepare the budget the president approves the budget and it goes to congress

Question 41

Congressional Budget and Impoundment Control Act

Answer 41

An act designed to reform the congressional budgetary process. It supporters hoped it would make congress less dependent on the presidents budget and better able to set and meet its own budgetary goals -helps congress
includes:
a fixed budget calendar
a budget committee in each house
The Congressional Budget Office

Question 42

reconciliation (helps to cut spending)

Answer 42

a congressional process through which program authorizations are revised to achieve required savings (includes tac and revenue adjustments)

Question 43

Budget Resolution

Answer 43

a resolution binding congress to a total expenditure level, supposedly the bottom line of all federal spending for all programs

Question 44

Authorization (helps to cut spending)

Answer 44

and act of congress that establishes, continues, or changes a discretionary gov’t program or entitlement

Question 45

Appropriations

Answer 45

an act of congress that actually funds programs within limits established by authorization bills that usually covers 1 year

Question 46

continuing resolution

Answer 46

when congress cannot reach agreement and pass appropriations bills, these resolutions allow agencies to spend at the same level as last year (when congress can’t make decisions in time)

Question 47

Balanced Budget and Emergency Deficit Control Act

Answer 47

Gramm-Rudman-Hollings

Designed to reduce the federal budget deficit. The law did so primarily by setting deficit limits and authorizing across-the-board spending reductions to reach them. Although the Supreme Court ruled that a key part of this mechanism was unconstitutional, the basic concepts embodied in the statute have continued to influence the process for adopting the federal budget.

Question 48

sequestrations

Answer 48

across the board budget cuts