1. Bureaucracy & Financing the Government

2. Bureaucracy  Most of it is contained within the Executive Branch (p. 417)  President is the Chief Administrator, Article II, Section 3  Puts policies into action and enforces legislation

3. Bureaucracy  Bureaucracy:  Large, complex administrative structure which handles everyday business of the federal government  Hierarchical authority  Job Specialization  Formalized Rules  Separated into 3 parts More Workers & More Specialized Fewer Workers & Less Specialized

4. Executive Departments  Each Department headed by a Secretary  Cabinet  Informal advisory board to the President  Traditionally made up of heads of 15 executive departments  Departments of State, Justice, Defense, Education, Treasury, etc.

5.  Department of State  Department of Treasury  Department of Defense  Department of Justice  Department of Interior  Department of Agriculture  Department of Commerce  Department of Labor  Department of Health and Human Services  Department of Housing & Urban Development  Department of Transportation  Department of Energy  Department of Education  Department of Veterans Affairs  Department of Homeland Security

6. Executive Office of the President  The EOP is staffed by the President’s most trusted advisors  White House Office  “Nerve Center”  Chief of Staff, Press Secretary, assistants to President  National Security Council  Advises President on domestic, foreign, and military issues that relate to security  VP, Secretary of State, Secretary of Defense, head of CIA & FBI  Office of Management and Budget

7. Independent Agencies Independent Agencies – Created outside the Executive branch  Do not fit well within departments  Created to be independent of the Executive  Protect from influence of partisan and pressure politics  3 groups of agencies

8. Independent Agencies Cont.  Independent Executive Agencies  NASA, EPA, etc.  Don’t fit well within Executive departments but are run similarly  Government Corporations  FDIC, US Postal Service, TVA, etc.  Are under presidential control  Established by Congress to perform business-like activities

9. Independent Agencies Cont.  Independent Regulatory Commissions  10 of them: The Fed, FTC, SEC, etc.  Largely out of reach of presidential control: appointed with senate approval  Quasi-legislative and quasi-judicial

10. Financing the Government

11. Quick lesson on Budget terms  Mandatory Expenses—Expenses that are not optional. (Mortgage, rent, car, etc.)  Government—federal spending that is based on existing laws rather than the budgeting process. Based on eligibility rules.  Discretionary Spending—Expenses that are optional and fluctuate. (Groceries, fuel, internet, entertainment, etc.)  Government—Presidents requests and Congress appropriates every year.

12. Budget Terms Cont.  Deficit—Expenditures are greater than income. (Savings, credit, overdrawn)  Government—amount by which government expenditures are greater than tax collections in a given year  Entitlement Programs—a federal program in which all people who are eligible for benefits according to eligibility rules written into law must receive the benefits if they apply for them. (Food Stamps, Welfare, Social Security, etc.)

14. Types of Taxes  Progressive Taxes  Tax increases based on an individual’s ability to pay  Corporate Taxes – pay according to its profit for year  Income Taxes – #1 source of revenue  http://www.moneychimp.com/features/tax_brackets.htm http://www.moneychimp.com/features/tax_brackets.htm  Tax Return – declaration of income & deductions - IRS by April 15 th

15. Types of Taxes  Regressive Taxes  Taxes levied at a flat rate without regard to the level of a taxpayer’s income or ability to pay  Sales tax – 8.25%

16. Types of Taxes  Excise  Taxes on the production, sale, or consumption of specific goods  “Luxury” or “Sin” taxes  Airline tickets, tires, firearms, tobacco, beer, gambling

17. Types of Taxes  Estate taxes (Death taxes)  Paid according to a person’s wealth, land, estate at their death  Gift taxes  Tax gifts over $12,000 a year (to keep people from giving away estate)

18. Federal Spending  Each branch within the government receives a portion  Executive Departments spend the most  President submits a budget to Congress each year for approval  Must be approved by whole Congress