Deck 13: The Budget: the Politics of Taxing and Spending

Question 1

The Social Security Act was enacted in __________.

A)1865
B)1890
C)1935
D)1964

Answer 1

1935

Question 2

Which of the following best supports Allan Meltzer and Scott Richard's argument that government grows in a democracy because of the equality of suffrage?

A)Working- and middle-class voters will support more generous Social Security and Medicare benefits.
B)Economically disadvantaged voters will support increased defense spending.
C)Wealthy voters will support progressive taxation.
D)Veterans will support reducing the influence of the military-industrial complex.

Answer 2

Working- and middle-class voters will support more generous Social Security and Medicare benefits.

Question 3

Which of the following most accurately describes the federal capital budget?

A)It is used to pay for Social Security.
B)It is used for infrastructure projects,such as roads and bridges.
C)It is used to fund tax expenditures.
D)The federal government does not have a capital budget.

Answer 3

The federal government does not have a capital budget.

Question 4

Which of the following illustrates American citizens' usual attitude toward the budget?

A)Americans want to decrease taxes,decrease spending,and balance the budget.
B)Americans want to increase taxes,decrease spending,and balance the budget.
C)Americans want to keep taxes low,maintain or increase spending,and balance the budget.
D)Americans want to keep taxes low,decrease spending,and run a budget surplus.

Question 5

Which of the following budgetary process actors does the president oversee?

A)House and Ways Committee
B)Joint Committee on Taxation
C)Congressional Budget Office
D)Office of Management and Budget

Question 6

In which of the following years was Medicare added to the Social Security system?

A)1935
B)1965
C)1998
D)2001

Question 7

Tax expenditures are __________.

A)yearly appropriations of funds by the president and Congress
B)revenue losses from special exemptions,exclusions,or deductions
C)the financial resources of the government
D)federal policies allocating tax burdens and benefits

Question 8

A(n) __________ is an act of Congress that funds programs established by authorization bills.

A)joint proclamation
B)appropriations bill
C)budget resolution
D)omnibus bill

Question 9

A(n) __________ is an act of Congress that establishes or changes a government program.

A)authorization bill
B)appropriations bill
C)continuing resolution
D)budget resolution

Question 10

According to Figure 13.3,what is the approximate amount of the national debt in 2015?

A)$17.5 trillion
B)$3.7 trillion
C)$800 billion
D)$500 billion

Question 11

A(n) __________ is an act of Congress that attempts to bind Congress to a total expenditure level for all programs in a given year.

A)authorization bill
B)appropriations bill
C)continuing resolution
D)budget resolution

Question 12

Which president had low budget deficits during his presidency?

A)Ronald Reagan
B)Barack Obama
C)Bill Clinton
D)George H.W.Bush

Question 13

The rise of the national security state first began with __________.

A)the Civil War
B)World War I
C)the Cold War
D)the September 11,2001,terrorist attacks

Question 14

By law,the president must submit a budget by the first Monday in __________.

A)February
B)September
C)October
D)November

Question 15

Which of the following best describes the executive branch's role in the budget process before the Budget and Accounting Act of 1921?

A)The president proposed an executive budget to the secretary of the treasury.
B)Executive branch agencies sent budget requests to the secretary of the treasury.
C)The Office of Management and Budget proposed an executive budget to Congress.
D)The Government Accounting Office proposed an executive budget to Congress.

Question 16

Which of the following investors hold the majority of the federal government's public debt?

A)foreign investors
B)citizen investors
C)corporate investors
D)financial institutions

Question 17

The __________ Amendment permits Congress to levy income taxes.

A)Sixteenth
B)Seventeenth [This Amendment does not relate to income taxes,but it was added to the Constitution in the same era as the right answer.
C)Eighteenth
D)Nineteenth

Question 18

In 2016,the average Social Security check for retired workers was __________.

A)$121
B)$523
C)$1,341
D)$3,523

Question 19

Which is the largest social policy of the federal government?

A)Social Security
B)drug rehabilitation
C)assistance for the poor
D)food subsidies

Question 20

In which of the following years were prescription drug benefits added to Medicare?

A)1965
B)1974
C)2003
D)2012

Question 21

A balanced budget occurs when __________.

A)appropriations are equal to authorizations
B)government spending is equal to the sum of all tax expenditures
C)the national debt is zero
D)there is no budget deficit

Question 22

The increase in __________ is the greatest threat to the viability of the intergenerational system for funding Social Security.

A)birthrates
B)life expectancy
C)social insurance taxes
D)the size of the working population

Question 23

What is the purpose of continuing resolutions?

A)to allow agencies to continue to spend money even when Congress has not met its budgetary timetable
B)to essentially override presidential vetoes
C)to lump together multiple authorization bills to increase the chance of passage
D)to ensure that the federal budget is balanced except in emergencies

Question 24

Who pays income taxes?

A)federal and state governments
B)corporations and individuals
C)universities and churches
D)all U.S.citizens

Question 25

The deficit is the amount by which a given year's spending exceeds that year's __________.

A)appropriations
B)tax expenditures
C)revenue
D)national debt

Question 26

Which of the following reports directly to the president?

A)Government Accountability Office (GAO)
B)Appropriations Committees and subcommittees
C)Budget Committees and subcommittees
D)Office of Management and Budget (OMB)

Question 27

In what sense is Social Security spending "uncontrollable"?

A)Congress determines how much it will spend for Social Security each year.
B)Social Security spending varies according to how much money is available in the Social Security Trust Fund.
C)Congress has enacted laws that make Social Security payments automatic for all those who are eligible.
D)Social Security requires funding from excise taxes that are unpredictable from year to year.

Question 28

Which of the following is a law that limits how much the federal government may borrow?

A)debt ceiling
B)capital budget
C)tax expenditure
D)budget resolution

Question 29

Which is an example of intragovernmental debt?

A)money borrowed from foreign governments
B)money the government has borrowed from Social Security revenue for general spending
C)money borrowed from private corporations that purchase government bonds
D)money borrowed from citizens who purchase government bonds

Question 30

The fact that 43 percent of people filing income tax returns in 2013 paid no income tax at all is partly explained by the fact that the income tax is __________.

A)regressive
B)progressive
C)proportional
D)flat

Question 31

Which of the following is a tax expenditure?

A)appropriations bills
B)authorization bills
C)lower tax rates for stock and real estate profits
D)estate taxes

Question 32

What is the largest tax expenditure in the United States?

A)deduction of mortgage interest on owner-occupied houses
B)deferral of income from controlled foreign corporations
C)exclusion of employer contributions to health care and insurance
D)exclusion for interest earned on state and local government bonds

Question 33

What is incrementalism?

A)the tendency for budgets to increase modestly from year to year
B)income tax rates that increase in increments as income increases
C)congressional resolutions that prohibit spending increases except in times of emergency
D)the tendency for the national debt to increase in large increments every year

Question 34

How might democracy distort budgeting?

A)The income tax is a progressive tax.
B)Politicians spend public funds to win votes.
C)Funds are borrowed from foreign governments.
D)Congress approves taxes and appropriations.

Question 35

Which is a tax expenditure given primarily to college students?

A)American Opportunity Credit
B)private student loans
C)private scholarships
D)research grants

Question 36

Which of the following is an accurate statement about the American Opportunity Credit and the Lifetime Learning Credit?

A)They are education credits you can deduct from your taxable income.
B)They are education credits you can subtract in full from your federal income tax.
C)They are credits earned through job training programs that can be applied toward degrees at any public university.
D)They are credits earned through life experiences that can be applied toward degrees at any public university.

Question 37

A tax expenditure is essentially a __________ for activities that the government wants to encourage.

A)revenue surplus
B)penalty
C)tax increase
D)subsidy

Question 38

Recent __________ in the United States have resulted in policymaking that could be considered the "politics of scarcity."

A)tax cuts
B)pork barrel projects
C)subsidies
D)tax expenditures

Question 39

What is the national debt?

A)all of the money Congress has spent
B)all of the money the federal government has borrowed and has not yet repaid
C)the sum of all tax expenditures minus the sum of all tax receipts
D)the sum of all tax receipts minus the sum of all tax expenditures

Question 40

Which of the following is an excise tax?

A)tax levied on corporate income
B)tax levied on personal income
C)tax levied on the consumption of a certain good
D)tax levied on the top 2 percent of income earners

Question 41

In 1921,Congress passed the Budget and Accounting Act to alleviate concerns about __________.

A)retiring the debt from World War I
B)communist influence in the budget process
C)corporate funds going to political campaigns
D)the viability of the Social Security program

Question 42

Which of the following is the role of the Government Accountability Office (GAO)?

A)to monitor what agencies do with their budgets
B)to make the budget for Congress [The GAO focuses its energy on checking to assure appropriated money is used-and used within the intended context.
C)to propose new bills to implement the president's agenda
D)to write tax codes based on yearly changes in law

Question 43

Why did the United States keep a large permanent military after World War II?

A)Treaties would not allow an extensive demilitarization.
B)The large veteran population supported peacetime military service.
C)Defense contractors successfully lobbied for an increase in contracts.
D)The Cold War began shortly after World War II ended.

Question 44

Which of the following is the role of the Congressional Budget Office?

A)to monitor what agencies do with their budgets
B)to write tax codes based on yearly changes in law
C)to propose new bills following the president's agenda
D)to advise Congress on consequences of its budget decisions

Question 45

Financially,who benefits the most from the military-industrial complex?

A)Congress
B)the president
C)defense contractors
D)taxpayers

Question 46

What does the federal government do when it is unable to cover its expenditures?

A)sells bonds
B)indexes taxes to the cost of living
C)changes the tax code
D)invests in pork projects