1. Ch 20 Taxing and Spending

2. 20-1 Raising Money Vocabulary: Graphic Organizer ( P.555)
90% of gov. $ comes from taxes.
45% from individual income taxes.
14% from corporate taxes.
Social Security taxes pays for SS and Medicare.
Excise taxes-manufacture, trans., sale, consumption, liquor, cigarettes.
Custom duties or tariffs.
Estate and gift taxes..
Vocabulary:
Taxes-
Taxable income-
Dependent-
Withholding-
Securities-
National debt-
Graphic Organizer ( P.555)

3. 20-2 Preparing the Federal Budget
President oversees budget process.
Congress approves the spending.
Vocabulary:
Fiscal year-
Uncontrollables-
Entitlement-
Incrementalism-

4. 20-3 Managing the Economy
Spending: 1) interest on debt; 2) direct benfit payments to individuals; 3) national defense; 4)grants to state and local gov’t.
Almost 50% of gov spending goes to support health care and social programs.
Defense is over 20%
Grants range from road repair to school lunch programs.
Monetary Policy
This is controlled by the Federal Reserve System (The Fed)
Divided into 12 Districts
Central Banking system of US
Fed Tools: raising or lowering discount rate, raise or lower reserve requirement, buy or sell US securities (T Bills)
Vocabulary:
Fiscal policy-
Monetary policy-
Gross domestic product (GDP)-
Discount rate-
Reserve requirement-
Open-market operations-