BUDGET POLICY

Introduction to the Federal Budget

Truly understanding the federal budget is probably an insurmountable (and depressing) task for anyone; but for our purposes we will need to develop a basic understanding of the following:

1.How the budget process works and what role is played by various actors within the political system. How the Executive Branch’s role has evolved.

2. How the budget affects policymaking and political decisions.

3.How politics affects the budget process.

4.What actually makes up the federal budget (at least the ‘Cliff’s Notes’ version)

To develop that understanding, you will do some online activities. For this part of the assignment, you do some ‘research’ and take notes on one aspect of the federal budget. Then, you will share your knowledge with your classmates. After learning about the process, you’ll have a chance to create your own budget and debate your proposals with your classmates. You’ll need to take some notes as you navigate through Budget 101.

Go to:

Everyone:First, read the introduction and take note of the following:

How much was the 2015 budget proposal? Why should individuals and states care about what’s happening at the federal level?

After THE INTRO, you will work on your assigned part.

GROUP A:Click on Federal Budget Process and take notes on the following:

  1. What does the Constitution say about the budget?
  1. What is the difference between appropriations and authorizations?
  1. Who has power to create the budget? How has that power changed over time?
  1. What role do the Executive Branch and Congress play? What are the steps in the process and when is it supposed to happen?
  1. What does a budget resolution do?
  1. Why are continuing resolutions and supplemental appropriations necessary?

GROUP B:Click on Where does money come from? Take notes on:

  1. What were projected revenues for 2015?
  1. Sources of revenue (be sure to know different types and approximate percent; include import and excise taxes)
  1. What is the difference between federal funds and trust funds?
  1. How did the income tax develop? What’s a progressive tax? What’s the tax rate for corporations (effective and actual)?
  1. What is a tax loophole?
  1. How have revenues changed over time?
  1. What is the payroll tax? How does it work?
  1. How is borrowing used to raise revenues?

GROUP C:Click on Where does the money go? Take notes on:

  1. Difference between mandatory and discretionary spending (approximate percent for each)
  1. Proposed spending for 2015 (how for different programs—percent)—where is discretionary money spent
  1. Total spending—what accounts for most spending?
  1. What are entitlement programs? How is eligibility for entitlements determined? How can entitlements be changed?
  1. How much is spent on the mandatory programs? What’s the impact on the overall budget?
  1. How much is spent on the interest on the debt?
  1. Explain the concept of spending in the tax code. How much did tax expenditures cost in 2014? How does the tax expenditure process differ from the discretionary budget process?

GROUP D: Click on Borrowing and Debt: Take notes on:

  1. What’s the difference between debt and deficit? When is there a surplus?
  1. How have deficits and surpluses changed over time? In the chart, when have we had surpluses?
  1. When did the latest deficits begin? What has happened lately?
  1. How does the federal government borrow money?
  1. Who holds U.S. debt? How does the government owe itself money?
  1. Why does the debt ceiling need to be raised? What happens if it isn’t raised? Why has raising the debt ceiling become more difficult in recent years?
  1. What are the different views of the deficit?

Go to Interactive Data and click on ‘your tax chart/receipt’. Enter an amount of taxes paid for the year. A yearly income of about $200,000 for a family with 2 kids would pay about $30,000 a year. See what this person’s tax bill for different programs would be.