This Quiz Is On The Federal Budget

During the 1992 presidential campaign, one of the defining events that voters remembered was President Bush's no new tax pledge. This pledge was significant because it was a promise made by President Bush not to raise taxes, which resonated with many voters who were concerned about their financial well-being. This pledge became a central point of discussion and debate during the campaign, making it a memorable event for voters.

Income taxes give the federal government the greatest amount of income because they are levied on individuals and businesses based on their income levels. This means that the more money individuals and businesses earn, the more they are taxed, resulting in a significant source of revenue for the government. Social Security and payroll taxes, corporate taxes, luxury taxes, and money collected from tariffs also contribute to the government's income, but income taxes tend to generate the highest amount of revenue.

As a result of President Nixon's practice of cutting off funds for programs he felt would increase the budget, Congress passed the Congressional Budget and Impoundment Control Act. This act was passed to regain control over the budget process and prevent the president from impounding funds without congressional approval. It established a budget process that required the president to submit an annual budget to Congress and set up a timetable for the approval and implementation of the budget. This act was a response to Nixon's actions and aimed to restore the balance of power between the executive and legislative branches in budgetary matters.

Congress is given specific constitutional power of the purse. This means that Congress has the authority to control and allocate funds for the government's budget. This power allows Congress to make decisions regarding taxation, spending, and appropriations. The Office of Management and Budget, the president, special interest groups, and executive agencies do not have this specific constitutional power.

The correct answer is "investments in Social Security would increase." Proponents of the plan to privatize Social Security argue that by allowing individuals to invest their Social Security contributions in the stock market, the potential for higher returns on investment would increase. They believe that the stock market's volatility can be managed to generate higher investment returns, which would benefit individuals and increase the overall value of Social Security investments.

President Reagan's 1981 tax bill included a decrease in the number of tax brackets. This means that there were fewer income ranges that were subject to different tax rates. The purpose of this change was to simplify the tax system and reduce the overall tax burden on individuals and businesses. By reducing the number of tax brackets, it made the tax code more streamlined and easier to navigate, while also potentially reducing the amount of taxes owed by individuals in certain income ranges.

If Congress does not pass a budget by the beginning of the fiscal year, the correct answer is that the Congress must pass a continuing resolution. A continuing resolution is a temporary measure that allows the government to continue funding its operations at the previous year's levels until a new budget can be agreed upon. This ensures that the government can still function and provide essential services while negotiations for a new budget take place.

Over the past 20 years, entitlements have shown the greatest increase in budgetary spending. This can be attributed to various factors such as an aging population, rising healthcare costs, and increased demand for social welfare programs. Entitlements include programs like Social Security, Medicare, and Medicaid, which provide financial assistance and healthcare benefits to eligible individuals. The increasing expenditure on entitlements reflects the government's commitment to supporting the needs of its citizens in areas such as retirement, healthcare, and social welfare.

The federal government cannot borrow money from itself (the United States Treasury) because it is the entity responsible for managing the government's finances and issuing debt. The Treasury is responsible for selling Treasury securities to investors, including foreign investors, commercial banks, and money market funds. Trust funds, such as Social Security and Medicare, are also sources of borrowing for the government. Therefore, the correct answer is the United States Treasury.

The creation of the National Service Program is not an attempt at lowering the nation's deficit because it does not directly address government spending or revenue. The other options mentioned in the question, such as passing a balanced budget amendment, changing the welfare system, and instituting means testing for Social Security and Medicare, all involve potential changes in government policies or programs that could potentially reduce government spending and contribute to deficit reduction. However, the National Service Program is not directly related to fiscal policy or deficit reduction.