1. Unwrap the Objectives
Factual: Define taxation, fines, and debt in their relation ship to government
Conceptual: Explain how government is financed
Communicative: Explain how taxes affect you

2. Agenda
Notes
Word Exclusion
Political Cartoon
Class discussion

3. Essential Question?
How does the government pay for its activities?

4. Function of Government
Unit 4

5. How Government is Financed
Part 1 & 2

6. Political Cartoon Analysis
Based on this cartoon does the government respect the work of tax payers?
What is the BIZ likely to do to raise profits?
What does GOVT. mean by “tax payers will need to work harder”?
Political Cartoon Analysis

7. Taxation Taxes are the primary way that government pays it’s bills
Taxes are money collected by the government from its people

8. Income Tax A tax on the money a person or company makes
United States Tax Bracket 2016:
Marginal Tax Rate
Single Taxable Income
Married Filing Jointly or Qualified Widow(er) Taxable Income
Married Filing Separately Taxable Income
Head of Household Taxable Income
10%
$0 – $9,275
$0 – $18,550
$0 – $13,250
15%
$9,276 – $37,650
$18,551 – $75,300
$13,251 – $50,400
25%
$37,651 – $91,150
$75,301 – $151,900
$37,651 – $75,950
$50,401 – $130,150
28%
$91,151 – $190,150
$151,901 – $231,450
$75,951 – $115,725
$130,151 – $210,800
33%
$190,151 – $413,350
$231,451 – $413,350
$115,726 – $206,675
$210,801 – $413,350
35%
$413,351 – $415,050
$413,351 – $466,950
$206,676 – $233,475
$413,351 – $441,000
39.6%
$415,051+
$466,951+
$233,476+
$441,001+

9. Lets figure it out When do you finish paying your taxes (income)?
$25,000 vs. $250,000
25,000 * .15= X $25,000/52=y X/Y=(number of weeks to pay off your taxes) what month do you pay off your taxes?
$250,000*.33=X $250,000/52=Y X/Y(weeks in a year)=(number of weeks to pay off your taxes) what month do you pay off your taxes?
Do you think that this is fair? Why or why not?
Lets figure it out

10. True or False: Taxes are the government’s only source of revenue
True or False: In most places around the world, income taxes are progressive
Bell Work

11. Sales Tax A tax that is applied to the price of an item.
The merchant making the sale is responsible for collecting the tax and getting the money to the government
Some items are taxed differently
Some states do not tax essential items like food or clothing
The Louisiana state sales tax is 5%
In some places, it is as high as 12% when your add local sales tax
Sales Tax

12. Property tax A tax on the assessed value of your property
The tax collector is responsible for determining the value of your property, and it may be different than the market value of your home
Some governments create an office specifically for the assessor and it is their job to report the value to the tax collector for property in their district.
Some states give exemptions to property that people live on
Usually there is a cap to the value that can be exempt – homestead exemption
Property tax

13. You stop at a gas station on your way to town and buy a Red Bull for $2.50. Then when you get in town, you by a new Xbox One S for $399.
How much do you spend on sales tax?
$2.50*.05=
399*.12=
How much less would the Xbox cost if you bought it out of town?
399*.12=x *.05=Y X-Y= the difference in price
How far would you drive to save on the sales tax
When would you drive to Mississippi if it had no sales tax.(4 hours driving their and back)?
Lets figure it out

14. This is a tax on the property that you leave to someone when you die or that you give to someone while you are still alive
In some places, this tax can be as high as 50% of the value of the property being given as a gift
Most people that plan to leave property to someone should plan on how the taxes will be paid so that the person that they want to get the property will be able to take ownership of it
Estate Tax or Gift Tax

15. Is a tax that is set at a high rate to discourage people from doing something
Alcohol and cigarettes both have a sin tax in most places.
The tax collection is often spent in these ways:
Teaching people about the danger of using the items that are being taxed
Helping people who are recovering from the negative affects of using the item, such as helping people with lung cancer
Sin Tax

16. Fines A financial penalty that a person must pay
Most are associated with minor crimes and traffic violations
Depending on the size of the fine and the crime committed, the money collected could end up in a variety of different places
Traffic fines - the money is usually divided between the state and local government
Criminal fines
Go back to the person hurt by the criminal
Go to the agency that has oversite to the crime committed
Or to support other victims of a similar crime

17. Borrowing
When the government does not collect enough money to pay for all of it’s bills and projects, the government borrows money from the people and other countries
Bonds – are securities sold by the government for a set value and at a set time the value will increase ex. $25 bond will be worth $35 in 10 years
Bonds can be sold to almost anyone including companies and other countries China and Japan hold a very large number of American bonds
The government get s the $25 now but must pay back $35 in the future

18. 16th Amendment
Made it legal for the government to collect a national income tax.
Before this amendment taxes were to be collect from the states based on population.
The 16th amendment paved the way for a national progressive income tax

19. Unwrap the objectives Factual: Define Revenue and Expenditures
Conceptual: Describe the major Revenue and Expenditure Categories and their impact on state and federal budgets
Communicative: Evaluate Government programs by their coast and benefit to society
Unwrap the objectives

20. Agenda Unwrap the Outcomes Lecture Notes Class discussion
Word Exclusion
Political Cartoon analysis
You decide (Graphic organizer & writing prompt)
How did we accomplish our goals (Reflection on the lesson)
Agenda

21. What government programs are major expenditures and are their benefits worth the government investment?
Essential Question

22. Government Spending
Part 3&4

23. Discretionary vs. Mandatory Spending
Discretionary Spending is the portion of the budget that the president requests and Congress appropriates every year. It represents less than one-third of the total federal budget, while mandatory spending accounts for around two-thirds.
Mandatory Spending is federal spending that is spent based on existing laws rather than the budgeting process. For instance, spending for Social Security is based on the eligibility rules for that program. Mandatory spending is not part of the annual appropriations process.
Interest on Debt is the interest payments the federal government makes on its accumulated debt.
Discretionary vs. Mandatory Spending

26. Based on the discretionary spending budget, what is the number 1 priority of the country?
Based on the total spending budget, what is the number 1 priority of the country?
Based on Mandatory spending, what is the number 1 priority of the country?
Document analysis

27. Expenditures: Social Security
Social Security  is the commonly used term for the federal Old- Age, Survivors, and Disability Insurance(OASDI) program.
Social Security is funded primarily through payroll taxes
In 2015, Social Security expenditures totaled $750.5 billion for OASI and $146.6 billion for DI.[6] Income derived from Social Security is currently estimated to reduce the poverty rate for Americans age 65 or older from about 40% to below 10%

28. The purpose for Social Security
The program was created to be a safety net for people that worked all their lives but reached retirement without saving or a company pension.
The idea was that these people would need help from the government or their families to survive
Social Security was meant to be a mandatory retirement account that the government would force people to contribute to
The average monthly Social Security retirement benefit for January 2016 is $1,341. The amount changes monthly.
The purpose for Social Security

29. According to the cartoon, what is the problem with Medicare?
Based on the cartoon, what needs to be done to improve Medicare?
What symbolism do you see in the cartoon?
Political Cartoon

30. Expenditures: Medicare
Around 27% of the total budget is spent on Medicare
This money comes from a payroll tax of 1.45% that is deducted from working people’s paychecks
The idea is that everyone pays into it and everyone will be able to use it in the future

31. The Purpose of Medicare
The purpose of Medicare is to provide health insurance to elderly people(65 or older)
There are several different parts that a person can qualify for and some are based on income
The program is designed to help people who have reached retirement age with the cost and availability of insurance.
People who are on a fixed income
The Purpose of Medicare

32. Expenditures: Medicaid
Medicaid is paid jointly from both the federal and state governments
Medicaid has a budget of around 550 billion dollars between the federal and state governments
Rich states have 50% of their Medicaid spending matched and poor states get even more.
Expenditures: Medicaid

33. The Purpose of Medicaid
Medicaid is a government insurance program that helps people with low incomes to afford health insurance
This program is ran at the state level with the federal government matching funds spent by the states on the program
The federal government does not provide a perfect match, instead there is a system used to determine how much they match, based on the income of the state
The Purpose of Medicaid

34. Expenditures: Defense
While defense spending is more that half of discretionary spending, it is just over 15% of total government spending
This is the money spent to provide training and equipment, as well as pay for the military
Osprey air plane $72.1 million
Humvee $22,000
M1 Abrams (tank) $8.92 million
Expenditures: Defense

35. The Purpose of Defense Spending
The purpose of the Defense department is to protect the homeland and our national interests at home and abroad
The money is used for drone strikes in the middle east on terrorists
To maintain a force in readiness
Provide global response at a moment's notice
Support our allies with arms and training
The Purpose of Defense Spending

36. In the Graphic Organizer, rank the government programs in terms of benefit vs. cost and describe why they are worth the money or how you would change them if they are not.
Programs are :Medicaid, Medicare, Social Security, Defense
Program
Why they are important
Changes you would make
You Decide

37. In groups of four, create your own budget Must Fill in the one each activity sheet
Create a pie chart that represents your group priorities
You will have ten minutes to complete this assignment
Things to think of:
Defense, Education, Roads, food, law enforcement, communication, health care,
You do not need to use the above list it is just to help get started.
You decide

38. Part 5&6

39. In the United States tax rates vary from person to person and company to company
The income tax is progressive higher rates for people that make more money or companies that have higher profits
Tax Rates

40. Taxes impact on national Debt
Taxes can be used to reduce the national debt
Theory one:
is that when you lower taxes people will have more money to spend and the government will take in more taxes through sales taxes and corporate income taxes
Down side is if people don’t spend then the government will not get as much income tax from people
Theory Two:
Is that when you raise taxes the government will have more money from each person
Down side people will have less money to spend and income taxes from companies will go down as well as sales taxes
Taxes impact on national Debt

41. Unwrap the objectives Factual: Define Inflation and Deflation
Conceptual: Explain how Fiscal Polices impact the economy
Communicative: Illustrate the consequences of inflation and deflation on the middle class
Unwrap the objectives

42. Agenda Unwrap objectives Lecture Fill in notes
Political cartoon analysis
3,2,1 Reflection on video
Agenda

43. Explain how Fiscal Policies of the united states affect American citizens
Essential Question

44. The Federal Reserve System
Unit 4 B

45. Fiscal Policy
Part 1

46. Changes in taxes or government spending with the hope to impact the national economy
Fiscal policy is used by the government when it feels that a correction needs to be made in the economy
Proactively, it is a change made to keep something from happening
Reactively, is a change that is made because something has already happened
Fiscal Policy

47. Political Cartoon Analysis
According to the political cartoon, who are the tax cuts helping?
Is the illustrator of the cartoon in favor of tax cuts?
What evidence do you have to support this?
What symbolism do you see in the cartoon?

48. Cutting taxes One Fiscal Policy is to cut taxes
The idea is that cutting taxes will put more money in the hands of people and business.
They will then spend the money by purchasing more goods causing the companies to hire more workers.
When more people are working, pay goes up and more purchases are made and more taxes are paid
The risk is that if the people that get to keep more money are afraid to spend it, then the government will lose revenue and the tax will return higher than ever
Cutting taxes

49. Increasing government spending
Another Fiscal Policy is increasing government spending
The idea is that if the government spends more money, it will create new jobs. The new jobs will increase tax revenues (income tax collected)
Workers with these new government jobs will then go and spend their money on goods and services which will improve the economy.
The Risk – the increase in government spending will lead to higher debt which will lead to a raise in taxes which will lead to less spending.
Increasing government spending

50. Inflation - a general increase in prices and fall in the purchasing value of money because to much money is in circulation.
Deflation - reduction of the general level of prices in an economy by limiting the amount of money available.
In general, Inflation is more dangerous to the economy because it reduces the buying power of workers. This can lead to layoffs if companies stop making profits, which only makes things worse.
Inflation is particularly hard on people that live on fixed incomes.
Incomes that are not expected to increase. Most retired people live on fixed incomes.
Inflation/Deflation

51. 3,2,1 Reflection Please list on your activity sheet
3 things that you learned from the video
2 things from the video that you found interesting
1 question that you have on the topic of the video
The video can be
3,2,1 Reflection

52. Managing the Money supply
The Federal Reserve has government authority to manage the amount of money in circulation to prevent deflation or inflation as part of the governments over all fiscal policy
Money supply refers to the amount of money in circulation at any given point.
When the Fed meets, they can set policy to manage the amount of money in circulation
When purchasing power is too low, they collect money from their branches and have it destroyed
When too little money is flowing through the economy, they order more money to be printed

53. Unwrap the objectives Factual: Describe the Federal Reserve System
Conceptual: Illustrate the Functions of the Federal Reserve System
Communicative: Justify the creation of the Federal Reserve system
Unwrap the objectives

54. Agenda Unwrap the objectives
You Decide (Answer a few short questions based on your own opinion)
Lecture
Fill in Notes
Vocabulary check (Cross word with vocabulary for end of year vocabulary test)
Agenda

55. Describe the Federal Reserve System, it’s functions, and Its Role in the United States economy
Essential Question

56. Functions and Role of the Federal Reserve System
Part 2

57. MONEY Anything that people can agree to give value to can be money
Currency includes both paper and coin money
Currency usually only has value because people agree that it does
A ten dollar bill only costs a few cents to produce
Through history, different things have been used as money
Shells, Coins, and furs have all be used as money
MONEY

58. What problems can come from the types of money listed below?
Why would they not be safe?
Shells
Coins
Furs
You Decide

59. The function of money Money has three functions:
Medium of exchange – this means we can trade money for goods or services
A store of value – this means that we can hold our wealth in the form of money until we are ready to use it
A Measure of value – the price of goods and services tells us what value they have
The function of money

60. What items can you think of that could be or should be used as money in an apocalypse?
Why?
When is it important for currency to be backed up by something?
You Decide

61. Financial Institutions
Commercial Banks – are institutions that offer full banking services
Savings and loans associations (S&Ls) – Institutions that traditionally loan money for people to buy house. S&Ls also provide savings accounts
Credit Unions – They work on a not-for-profit basis, where the goal is to offer great rates for members of a select group.
These three Financial institutions all serve similar roles
They connect people that want to save money with people that want to borrow money
Financial Institutions

62. Keeping the financial system safe
Banks make up a key role in the financial system and need to be protected so that the people that use them are protected
When you deposited money into your checking account, the bank puts that money to work by loaning it out to someone until you come to get it.
If too many people come to get their money back from a bank (bank run), then the bank will not have the money to give it all back to the people that get to the bank last.
The federal reserve was created to protect the nations financial systems.
Keeping the financial system safe

63. The Federal Reserve System
Created to prevent runs on the bank by managing the financial system
They do this through regulations and by having the ability to set a rate of interest for banks that borrow from the fed.
The fed also serves as the bank for the federal government in three ways:
It holds the governments money used to make payments and to buy goods
The fed sells government bonds so that the government can borrow money
The fed issues the nations currency
The fed does not print money or create coins this is done by other departments but they do so on the command of the fed

64. Changing the supply of money
The fed determines the amount of money that is in circulation.
When more is needed, they order more to be printed
When too much is available, they order old money to be collected and destroyed
Changing the supply of money