creating a budget chapter 14. budget process deficit v. surplus deficit occurs when expenditures...
TRANSCRIPT
Creating a Budget
Chapter 14
Budget Process
Deficit v. Surplus
• Deficit occurs when expenditures exceed revenues in a year– $1.3 trillion in 2010
• Surplus occurs when revenues exceed revenues in a year
Federal Revenues
Federal Expenditures
Trends in National Defense Spending
Trends in Social Service Spending
Uncontrollable Expenditures
Uncontrollable Spending
Spending that the president and Congress are unwilling to cut, includes interest on
national debt and entitlement programs, such
as Social Security and Medicare
Entitlement Programs
Government programs that provide guaranteed/required benefits to those who meet
eligibility requirementsEx.) Social Security – costs
$700 billion per yearPaid for through payroll taxes
of current workers
Uncontrollable Expenditures v. Discretionary Spending
• Uncontrollable expenditures – spending that is required– About 61% of the budget
• Discretionary spending – fluctuates each year depending on changing priorities of Congress + President– Incrementalism – best predictor of this year’s
budget is last year’s budget plus a little more
Federal Debt
• All of the money borrowed over the years that has not been paid
• Currently about $13.7 trillion
Federal Debt