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Warmup. How do you keep track of where you spend your money?. $. Money Matters. $. $. Exploring the Money Matters of the Federal Government. Where Does Federal Money Come From?. $. Where Does Federal Money Come From?. $.
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Warmup • How do you keep track of where you spend your money?
$ Money Matters $ $ Exploring the Money Matters of the Federal Government
Where Does Federal Money Come From? $ When the government needs more money, it can’t simply start printing it. It has to come from somewhere!
Where Does Federal Money Come From? $ TAXES! You might have heard people complain about paying taxes from time to time, but without taxes our government couldn’t run some very important programs that help people!
Where Federal Money Comes From $ The money that the government runs on is raised through taxes. That’s right! The money raised by the government through taxes is called revenue! This money is called REVENUE!
Where Federal Money Comes From $ There are several types of taxes… Social Security Income Tax This tax is taken to provide retired people with income they need. In 2010 it was 6.2% of your total income! This tax is based on a percentage of what you make. The more you make, the higher percentage you pay! Corporate Income Tax Excise Tax These are taxes paid on certain goods like alcohol, cigarettes, jewelry, and gas. Just like the personal income tax, corporations must pay income taxes! Other Taxes This includes estate taxes (when someone dies) and taxes on goods brought from other countries (tariffs).
Where Federal Money Comes From $ TOTAL: $2,381,000,000,000
Quick Review! $ Revenue is… A. New “reve” B. Money that the government raises through taxes C. Money that the government spends on taxes D. Money that the government spends over their budget
Where Federal Money Goes $ With all that money (all $2,381,000,000,000 of it) and all the projects in the country to think about, there is only one thing that can help keep it all straight… The Federal Budget
Where Federal Money Goes $ What’s a BUDGET?
Where Federal Money Goes $ Budget: A plan for how money is earned and spent
Where Federal Money Goes $ Federal Budget: A plan for how the government brings in and spends revenue
Where Federal Money Goes $ A budget is… A. a type of plan for printing money. I see! A budgetis a plan for receiving and spending money. B. something the government uses to measure things. C. a plan for receiving and spending money. D. a pet bird.
Federal Spending $ There are several ways the federal government spends money…
Federal Spending $ These are just broad categories!! Let’s break them down…
FY 2010: National Defense $ Defending our nation is a high priority. In 2010, more than $650 billion dollars went to funding military operations, personnel, supplies, and research! Total Defense Spending: $722,000,000,000
FY 2010: Social Security $ When people are retired or disabled, Social Security helps them get the financial assistance they need. Total Social Security Spending: $724,000,000,000
FY 2010: Income Security $ Other types of financial assistance help people who are disabled, unemployed, or needy. These programs provide necessities like housing and food. Total Income Security Spending: $629,000,000,000
FY 2010: Medicare $ When people retire, they often lose their health insurance. The U.S. government has established Medicare to help them pay for health care! Total Medicare Spending: $462,000,000,000
FY 2010: Health $ Doctors’ visits, medicines, emergency care… these are necessities for everyone! Insurance for the needy, disease research and control, and children’s health insurance all fall into this category. Total Health Spending: $386,000,000,000
FY 2010: Other Spending $ • There are many other categories of government spending. These include: • Education • Science • Environment • Development • Transportation Other Government Spending: $677,000,000,000
FY 2010 Spending $ The total estimated budget for 2010 was $3,600,000,000,000 Thousands Hundreds Trillions! Billions Millions
Quick Review! $ The federal budget is… A. The plan for managing and spending state money. B. The plan for raising government funds. C. The plan for figuring out who will feed the dog. D. The plan for managing and spending federal money.
Two Possible Outcomes $ After all the revenue is counted and all the spending is tallied, there are two possible outcomes for the budget…
Two Possible Outcomes $ The government spends LESS than it raises in taxes so that there is money left over! The government spends MORE than it raises in taxes so that it must borrow money! OR Deficit Surplus
Two Possible Outcomes $ Deficit In a deficit there is no money left over after the budget is laid out. Trillions of Dollars In fact the government must borrow money to complete the budget!
Two Possible Outcomes $ Surplus In a surplus there is money left over after the budget is laid out. Trillions of Dollars The government can use the money that is left over for other projects!
Two Possible Outcomes $ This chart shows that there has been a deficitalmost every year since 1980. Deficit: more money spent than earned Surplus: less money spent than earned
Fill in the blank: $ Most of the revenue raised by the government comes from _________tax. income
Match the definition to the term: $ budget money left over after the budget is spent federal budget spending more than is raised in taxes surplus the plan for bringing in and spending revenue deficit a plan for how money is earned and spent
Match the definition to the term: $ budget money left over after the budget is spent federal budget spending more than is raised in taxes surplus the plan for bringing in and spending revenue deficit a plan for how money is earned and spent
Match the definition to the term: $ budget money left over after the budget is spent federal budget spending more than is raised in taxes surplus the plan for bringing in and spending revenue deficit a plan for how money is earned and spent
Match the definition to the term: $ budget money left over after the budget is spent federal budget spending more than is raised in taxes surplus the plan for bringing in and spending revenue deficit a plan for how money is earned and spent
REVIEW $ a plan for how money is earned and spent budget federal budget the plan for bringing in and spending revenue Way to go! surplus money left over after the budget is spent deficit spending more than is raised in taxes
Choose the right answer: $ When the country spends more than it earns that is called a… A) Surplus B) Deficit OR
Choose the right answer: $ When the country spends less than the amount of money it earns it is called a… A) Surplus B) Deficit OR
Choose the right answer: $ According to the chart shown earlier, our country usually has a… A) Surplus B) Deficit OR
REVIEW $ That’s right! Our country usually spends more than it earns, so we have a deficit!