ECONOMIC POLICYMAKING

1. ECONOMIC POLICYMAKING

2. Who controls the Economy today? The President AND Congress!

3. The Federal Economy The President The Congress 1921 Budget & 1921- Congress hands over Accounting Act the reigns to the President to prepare the budget CEA- Council of Economic Advisors (3 members) OMB- Congressional Budget Office of Management & Budget & Impoundment Act 1974 (over 500 workers) CBO- Congressional Budget Office

4. Market vs. Non Market Economies

5. ADAM SMITHGovernment keep your hands out of Business! • ADAM SMITH

6. LAISSEZ FAIRE

7. JOHN MAYNARD KEYNES • We can control the Economy! • Aggregate Demand can be controlled through Monetary and Fiscal means.

9. FISCAL POLICIES SPENDING & TAXING

10. MONETARY POLICIES Money Supply & Interest Rates

11. The Federal Reserve Established 1913 7 Members all appointed by the president in office 14 yr. Tenure Federal Chairman BEN BERNANKE

12. TAXES WE PAY Property- pays for education, police, and fire protection Excise- ex: gasoline tax Personal- tax on your income Sales Tax- State and Local OH= 6% Geauga County- 6.5% Cuyahoga County- 7.5%

13. TAXES WE PAY Payroll Taxes- Social Security, Medicare etc. Licenses- Social Insurance- Social Security User Fees- turnpike tolls

14. Ohio’s State Income Taxes • How Ohio State income tax rates are structured The tax table below will show in detail the Ohio state income tax rates by income tax brackets). • There are 9 income tax brackets for Ohio. • If your income range is between $0 and $5,000, your tax rate on every dollar of income earned is 0.587%.If your income range is between $5,001 and $10,000, your tax rate on every dollar of income earned is 1.174%.If your income range is between $10,001 and $15,000, your tax rate on every dollar of income earned is 2.348%.If your income range is between $15,001 and $20,000, your tax rate on every dollar of income earned is 2.935%.If your income range is between $20,001 and $40,000, your tax rate on every dollar of income earned is 3.521%.If your income range is between $40,001 and $80,000, your tax rate on every dollar of income earned is 4.109%.If your income range is between $80,001 and $100,000, your tax rate on every dollar of income earned is 4.695%.If your income range is between $100,001 and $200,000, your tax rate on every dollar of income earned is 5.451%.If your income range is $200,001 and over, your tax rate on every dollar of income earned is 5.925%. Income tax brackets data last updated March 3rd, 2009.

15. 2008 Tax Bracketsfor Single Taxpayers

16. 2008 Tax Brackets for Married Couples

17. 2008 Tax Brackets for Heads of Household

18. STATE TAXES ON INDIVIDUALS See document in Ch. 18 folder SEE My Pay Stub--- in ch. 18 folder See ch. 18 folder for Receipts and Outlays 2004

20. Figure 18.2Federal Spending in 2011, by Function

22. TARP Troubled Asset Relief Programs Passed in 2008 by President Bush

23. American Recovery and Reinvestment Act (ARRA) 2009 February 13 ARRA was passed by both the House and Senate . Originally intended to be a bipartisan bill, the passage of the bill was largely along party lines. No Republicans voted for it in the House & three moderate Republicans voted for it in the Senate Collins and Snowe of Maine and Specter of PA. The bill combined TAX BREAKS with spending on INFRASTRUCTURE Projects, extension of welfare benefits, and education. The final cost of the bill was $787 billion, and almost $1.2 trillion with debt service included. President Obama signed the Act into law on February 17, 2009.