1. Bureaucracy & Financing

2. Bureaucracy  Bureaucracy:  Large, complex administrative structure which handles everyday business of the federal government  Hierarchical authority  Job Specialization  Formalized Rules

3. 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.

4. 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

5. Independent Agencies  Independent Agencies – Created outside the Executive branch  Do not fit well within departments  Independent Executive Agencies  NASA, EPA, etc.  Independent Regulatory Commissions  The Fed, etc.  Government Corporations  FDIC, US Postal Service, etc.

6. Financing the Government

8. 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 15th

9. 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%

10. 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

11. 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)

12. 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