The Federal Budget

appropriation

appropriation

an act of Congress that enable federal agencies to spend money for specific purposes.

Balanced budget

occurs when total revenues equal total outlays for a fiscal year.

Bipartisan

the agreement or cooperation of two political parties that normally oppose each other.

Budget resolution

the annual framework within which Congress makes its decisions about spending and taxes, which include targets for total spending, total revenues, and the deficit as well as allocation, within the spending target for discretionary and mandatory spending.

Continuing resolution

Legislation used by Congress to fund the government if appropriations have not been signed into law by the beginning of the fiscal year.

debt

when revenue does not cover the amount of spending

debt ceiling

enacted in 1917, this law limits the amount of money the U.S. can borrow.

deficit

the resulting difference between revenue and spending when there is not enough revenue to meet spending.

deficit spending

occurs when the government’s revenues do not cover the cost of all its spending and it borrows money to finance its programs, using borrowed money to pay for items in the budget.

Discretionary spending

what the president and Congress must decide to spend for the next fiscal year through the annual appropriations bills.

Entitlement

a program that legally obligates the federal government to make payments to any person who meets the legal criteria for eligibility, ie.. Social Security, Medicare, and Medicaid.

Excise tax

apply to various products, including alcohol, tobacco, transportation and telephone services.

Fiscal year

an accounting year that does not follow the calendar Jan to Dec. for the federal government the year starts October 1 and ending September 30, the following year.

Gross domestic product (GDP)

standard measurement of the size of the economy which amounts to the total production f goods and services within the U.S.

Mandatory spending

also called non-discretionary spending, is authorized permanent spending as prescribed by law such as Social Security. Congress and the president can change the law to change the level of spending but they do not have to.

National debt

when government borrows money to cover its spending, but is unable to repay the amount borrowed.

OMB

part of the Executive Office of the President the Office of Management and Budget assists the president in developing and implementing the federal budget.

reveune

the money collected through taxes, this does not include money collected trhough government’s businesslike activities such as entrance fees to national parks.

Social Insurance Payroll Taxes

Social Security taxes paid by the employee and employer, Medicare taxes, unemployment taxes and federal employee retirement payments.

surplus

the amount by which revenues (money taken in) exceed outlays (money spent)