Budget / Debt / Deficit 1 st Assignment: Budget 101 $3.8 Trillion for 2015 Federal Budget

IF I HAD A TRILLION DOLLARS

Red Text – do not need to know for test How high is a trillion in $1000 bills? 1 trillion dollars = 63 miles high (give or take a foot or two) If a person’s salary is $40,000 per year it would take: $1 Trillion you would have to save $34 Million each day of your life 1 trillion seconds = 30,000 B.C. (give or take a decade or two)

Mandatory vs. Discretionary Spending Mandatory Spending – spending that already is decided upon by existing laws. Do not have to be approved year to year Ex’s: Social Security, Medicare, Food Stamps Discretionary Spending – spending decided on by Congress each year Ex’s: Military, Education, Government (jobs/payroll)

Government Programs You Need to Know Social Security – A United States federal program of social insurance and benefits developed in The Social Security program's benefits include retirement income, disability income, death and survivorship benefits.Social Security program's benefits

Medicare – A U.S. federal health program that subsidizes people who meet one of the following criteria: 1. An individual aged 65 or older who has been a U.S. citizen or permanent legal resident for five years. 2. An individual who is disabled and has collected Social Security for a minimum of two years.Social Security 3. An individual who is undergoing dialysis for kidney failure or who is in need of a kidney transplant. 4. An individual who has Amyotrophic Lateral Sclerosis (Lou Gehrig's disease). Medicare helps out people at a time in their lives when they may have serious health problems but lack the funding for treatment.

Medicaid- A joint federal and state program that helps low-income individuals or families pay for the costs associated with long-term medical care, provided they qualify. Although largely funded by the federal government, Medicaid is run by the state where coverage may vary.

Welfare A government program which provides financial aid to individuals or groups who cannot support themselves. Welfare programs are funded by taxpayers andtaxpayers allow people to cope with financial stress during rough periods of their lives. In most cases, people who use welfare will receive a biweekly or monthly payment. The goals of welfare vary, as it looks to promote the pursuance of work, education or, in some instances, a better standard of living.standard of living

2 nd Assignment: Debt – Who We Owe About ¼ of the debt is owed to the Federal Government HOW?????? Example – the tax revenue that is collected for Social Security – the government has used some of that money to use for other spending….so the government owes the Social Security fund the Federal Reserve buys Govt. bonds – so the government owes the Federal Reserve

About ¼ of the debt is owed to China, Japan and other countries China is the country we owe the most to (1.3 trillion)

3 rd Assignment : YOU FIX THE BUDGET Student Reaction - Easiest Hardest

NY Times Readers Selections Reduce the size of the military rather than reduce pay for noncombat members of the military. Impose a millionaire’s tax rather than cut deductions for high-income households. Cap the growth of Medicare spendingMedicare rather than raise the eligibility age.

two groups: those who far prefer spending cuts, and those who want to mix cuts with tax increases. The responses also point to a deep divide between those two sides, illustrating why a solution is difficult.

The single least popular choice was allowing the expiration of the Bush tax cuts on income below $250,000 a year. Bush tax cuts But when it came to tax cuts for incomes above $250,000, people’s opinions appeared to diverge according to their political views. --conservative groups generally wanted this tax cut to remain in place. --liberal group — the expiration of the tax cut was the single most selected policy.

The most popular option among all respondents? 80% of responses included – Reducing the military to less than its size before the Iraq war — But cutting pay and benefits for the military was a choice of only 40 percent.

In this world nothing can be said to be certain, except death and taxes. In this world nothing can be said to be certain, except death and taxes. -Benjamin FranklinBenjamin Franklin 3 Types of Taxes You Need to Know

INCOME TAXES imposed on income earned by individuals or businesses. Federal and State Income Taxes (some states don’t have income tax) income taxes are typically withheld automatically from paychecks and sent to the government. actual "take home pay" for a worker often measures substantially less than his stated monthly salary or wage earned. Income taxes in the U.S. increase as a percentage of income for higher income earners. = called – Progressive (organized in TAX BRACKETS)

Deductions-lowers your taxable income

Income Tax (Social Security and Medicare) Federal Insurance Contributions Act (FICA) also known as payroll taxes. The FICA tax includes two different taxes: the social security tax and the medicare tax. ½ paid by employer ; ½ paid by employee Approx 14%: 7% paid by employer, 7% paid by employee

Sales taxes are taxes imposed on the sales of goods and services. In the U.S., sales taxes are imposed by state and local governments. Some states do not have sales taxes.

Property taxes charged for owning certain types of property. If you own a home or land, you may have to pay property tax on the value of the home and/or land. Property taxes may also be imposed on owners of vehicles and boats.