Chapter 10
trust funds
Funds for government programs that are collected and spent outside the regular government budget
balanced budget amendment
a constitutional amendment that requires that annual spending not exceed revenues
federal budget
a plan for the federal government's revenues and spending for the coming year
pass as you go provision
a requirment that new spending proposals or tax cuts must be offset by reductions elsewhere
grant in aid
a transfer payment one level of government makes to another
per capital
how much money each individual in the country earns
spending caps
legal limits on annual discretionary spending
federal budget spending
many entitlement programs cost the U.S. government a lot of money because they are programs that must be funded. Such programs are things like Social Security, Medicare, and Food Stamps.
3 ways that government spending may impact economy
money, minimum wage, economy
federal debt
the national devt of a coun, all the money borrowed by the federal government over the years and still outstanding
crowding out effect
the offset in aggregate demand that results when expansionary fiscal policy raises the interest rate and thereby reduces investment spending
private sector
the part of the economy that involves the transactions of individuals and businesses
public sector
the part of the economy that involves the transactions of the government
distribution of income
the way in which income is allocated among families, individuals, or other designated groups in the economy
entitlements
A claim for government funds that cannot be abridged without violating the rights of the claimant; for example, social security benefits or payments on a contract.
medicaid
A health care payment program sponsored by federal & state governments
line item veto
An executive's ability to block a particular provision in a bill passed by the legislature
transfer payment
Cash payments made by the government to people who do not supply goods, services, or labor in exchange for these payments. They include Social Security benefits, veterans' benefits, and welfare payments.
balanced budget
a budget is balanced when current expenditures are equal to receipts
discretionary spending
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deficit spending
Government practice of spending more than it takes in from taxes
seven major categories of spending
PC, mobile computers, servers, mainframes, super computers, game console, imbedded computers
mandatory spending
Required govt spending by permanent laws
two kinds of spending
The first kind is the purchase of goods and services. The second kind is in the form of payments to disadvantaged Americans and other people. (transfer payments)
intergovernmental expenditures
funds that one level of government transfers to another for spending
appropriations
funding that must be authorized by Congress for any federal spending
