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

Question 1

The __________ Amendment permits Congress to levy income taxes.

A) Sixteenth
B) Seventeenth
C) Eighteenth
D) Nineteenth

Answer 1

A

Question 2

In 2014,the average Social Security check for retired workers was __________.

A) $121
B) $523
C) $1,283
D) $3, 523

Answer 2

C

Question 3

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

Answer 3

C

Question 4

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 5

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

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

Question 6

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

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

Question 7

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 8

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 9

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 10

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.

Question 11

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 12

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.

Question 13

Which of these presidents had low budget deficits during his presidency?

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

Question 14

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 15

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 16

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

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

Question 17

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 18

The Social Security Act was enacted in __________.

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

Question 19

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 20

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 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 or budget surplus

Question 22

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 23

Which of the following is a tax expenditure given primarily to college students?

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

Question 24

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 25

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 26

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 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 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 29

The increase in __________ threatens 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 30

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 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 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 33

In 1985,President Reagan indexed taxes to the cost of living in order to __________.

A) prevent massive tax cuts
B) create new tax incentives
C) increase social insurance taxes
D) keep inflation from impacting tax brackets

Question 34

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 35

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 36

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 37

Who pays income taxes?

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

Question 38

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 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

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 41

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

Question 42

The Constitution requires that Congress approve taxes and appropriations.

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

A budget deficit is when expenditures exceed revenues in a fiscal year.

Question 45

The biggest slice of the budget pie has shifted from income security expenditures to defense expenditures.

Question 46

Prior to 1943,corporate taxes yielded more revenue than individual income taxes.

Question 47

President Obama is the first president to ask for the debt ceiling to be increased.

Question 48

Which of the following is the role of the Budget Committees and 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 49

Agencies present their budget requests to the president and Congress at the same time.

Question 50

Currently,about 1.9 million Americans receive Social Security payments.

Question 51

Less than 2 percent of all current budget expenditures go to paying the interest on the national debt.

Question 52

The debt ceiling is a limit on how much the federal government can borrow that can be increased by Congress.

Question 53

Federal expenditures have slowly but steadily decreased over the past 15 years.

Question 54

The president has the constitutional authority to add or subtract money from an agency.

Question 55

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 56

Social Security is an example of the allowance model of the budget,in which Congress allocates a lump sum to an agency and instructs it to meet its expenses throughout the fiscal year.

Question 57

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 58

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
C) to propose new bills to implement the president's agenda
D) to write tax codes based on yearly changes in law

Question 59

The American Opportunity Credit and Lifetime Learning Credit are examples of tax expenditures.

Question 60

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

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

Question 61

The congressional budget process begins on the first Monday in February and ends on __________.

Question 62

Explain why Social Security is an uncontrollable expenditure.

Question 63

The __________ works as Congress's eyes and ears by auditing,monitoring,and evaluating what agencies are doing with their budgets.

Question 64

Charitable contributions are a type of tax expenditure.

Question 65

__________ suggests that next year's budget for each government program will be a little more than the current year's budget.

Question 66

Congressional budget resolutions often require changes in the law,which are legislated through budget reconciliations or __________.

Question 67

An entitlement is an uncontrolled expenditure.

Question 68

Explain why Congress passes continuing resolutions.

Question 69

A __________ tax is an equal tax rate for everyone.

Question 70

The __________ Amendment,adopted in 1913,permits Congress to levy an income tax.

Question 71

Social Security and Medicare taxes are earmarked for their respective programs.

Question 72

Federal income taxes in the United States are flat and apply equally to all Americans.

Question 73

Authorization bills establish or modify government programs; __________ bills allocate money for authorized programs.

Question 74

Economically disadvantaged taxpayers benefit the most from tax expenditures.

Question 75

Taxes that are __________ to the cost of living prevent taxpayers from being bumped into a higher tax bracket due solely to inflation.

Question 76

The military-industrial complex is part of the social service state.

Question 77

A local government's __________ budget is unaffected by long-term expenditures,such as building new schools.

Question 78

President Eisenhower warned against the increasing influence of the __________.

Question 79

__________ are laws that allow government agencies to continue to spend money even if Congress has not enacted a budget.

Question 80

The __________ is responsible for helping the president produce budgetary policy.