Federal budget and government expenses

Oct 5th, 2017
Anonymous
Category:
Humanities
Price: $20 USD

Question description

THE ACTIVITY

  • Read the following scenario.

Over the past many years, there has been ongoing debate raging in Washington, D.C. regarding the U.S. federal budget. As the U.S. deficit increases, some argue that cutting government spending should be a key priority of our lawmakers. Others favor more gradual decreases, such as raising taxes or implementing a proposed freeze on discretionary spending. Either way, as an economic adviser to the President, you have been tasked with presenting a proposal that addresses how to fix a current budget gap of $300 billion dollars in an effort to appease both sides of this debate.

A-Using the budget below, decide what options you will suggest cutting or implementing for your presentation to the president. Remember that these actions must cover a budget gap of $300 billion. When you have reached your target, save your results—you will need to refer back to them to answer your assessment questions. ( Please keep in mind that these changes could seriously affect citizens' daily lives. Also keep in mind people may be so angered by the changes that they will take action to prevent the president’s reelection, thus putting you out of a job). Please answer all questions (8) related to previous activity .....questions are after the budget below:

DOMESTIC PROGRAMS AND FOREIGN AIDCut foreign aid in half $17 billion
Eliminate farm subsidies:

Opponents believe subsidies help large businesses at the expense of small farms. Supporters believe subsidies protect American agriculture.

$14 billion
Cut pay of civilian federal workers by 5 percent $14 billion
Reduce the federal workforce by 10%:

This would eliminate approximately 200,000 federal jobs.

$12 billion
Other cuts to the federal government: This includes reduced funds for the Smithsonian and the National Park Service, and closing the Office of Safe and Drug-Free Schools. $30 billion
Cut aid to states by 5%: This pressure states to cut funding for schools, police, and other services. $29 billion
MILITARYReduce nuclear arsenal and space spending: This would cut the number of nuclear warheads and end the "Star Wars" missile defense program. $19 billion
Reduce military to pre–Iraq War size and further reduce troops in Asia and Europe $25 billion
Cancel or delay some weapons programs: This would cancel some expensive purchases identified by the Sustainable Defense Task Force as possible cuts. $19 billion
HEALTHCAREEnact medical malpractice reform: This option would begin to reduce the chances of large malpractice verdicts, which supporters believe would also check rising medical costs. Opponents say it could reduce doctors’ incentives to avoid errors. $ 8 billion
Increase the Medicare eligibility age to 68 $ 8 billion
Raise the Social Security retirement age to 68: This would rise from the currently planned 67, encouraging people to work longer. $ 13 billion
EXISTING TAXESReturn the estate tax to Clinton-era levels: Those passing on an estate worth more than $1 million to their heirs would have portions of those estates taxed. $ 50 billion
End Bush tax cuts for income above $250,000 a year $ 54 billion
End Bush tax cuts for income below $250,000 a year $ 172 billion
Payroll tax increase for high earners: Those making over the current ceiling of $106,000 would have to contribute more to Social Security and Medicare. $ 50 billion
NEW TAXESMillionaire's tax on income above $1 million $ 50 billion
National sales tax: This would add a tax of 5 cents on every dollar for most purchases. $ 41 billion
Carbon tax: This option would tax carbon emissions, which scientists believe contribute to global warming. $ 40 billion
Bank tax: This would tax banks based on their sizes and the amount of risk they take. $ 73 billion
Total gap covered by your budget plan $_________________


1-What is your final plan to present to the president? What changes did you decide to implement?

2-Please explain why you choose the options that you did

3-How will your decisions affect the elderly , the poor , the rich and national security if implemented?

4-Was covering the hypothetical budget gap more or less than you expected? Please explain

5-Which of your decisions might be perceived as politically motivated? Why?

6-What are the trades-offs of preserving some programs while protecting others?

7-How do your decisions result in a marginal benefit to society so that they can outweigh the marginal cost to society?

8-Did doing this exercise change your feelings about the budget debate in Washington? If so, how? If not, why not?

Tutor Answer

(Top Tutor) Proff_White
School: UIUC
PREMIUM TUTOR

Attached.

Surname 1
Student’s name:
Instructor:
Course:
Date:
Federal budget and government expenses
DOMESTIC
$17
PROGRAMS AND

Cut foreign aid in half
billion

FOREIGN AID
Eliminate farm subsidies:
Opponents believe subsidies help large businesses at the

$14

expense of small farms. Supporters believe subsidies protect

billion

American agriculture.
$14
Cut pay of civilian federal workers by 5 percent
billion
Reduce the federal workforce by 10%:

$12

This would eliminate approximately 200,000 federal jobs.

billion

Other cuts to the federal government: This includes reduced
$30
funds for the Smithsonian and the National Park Service, and
billion
closing the Office of Safe and Drug-Free Schools.
Cut aid to states by 5%: This pressure states to cut funding for $29
schools, police, and other services.

billion

Reduce nuclear arsenal and space spending: This would cut the $19
MILITARY
number of nuclear warheads and end the "Star Wars" missile

billion

Surname 2
defense program.
Reduce military to pre–Iraq War size and further reduce troops $25
in Asia and Europe

billion

Cancel or delay some weapons programs: This would cancel
$19
some expensive purchases identified by the Sustainable
billion
Defense Task Force as possible cuts.
Enact medical malpractice reform: This option would begin to
reduce the chances of large malpractice verdicts, which
$8
HEALTHCARE

supporters believe would also check rising medical costs.
billion
Opponents say it could reduce doctors’ incentives to avoid
errors.
$8
Increase the Medicare eligibility age to 68
billion
Raise the Social Security retirement age to 68: This would rise
$ 13
from the currently planned 67, encouraging people to work
billion
longer.
Return the estate tax to Clinton-era levels: Those passing on an
$ 50

EXISTING TAXES

estate worth more than $1 million to their heirs would have
billion
portions of those estates taxed.
$ 54
End Bush tax cuts for income above $250,000 a year
billion
$ 172
End Bush tax cuts for income below $250,000 a year
billion

Surname 3
Payroll tax increase for high earners: Those making over the
$ 50
current ceiling of $106,000 would have to contribute more to
billion
Social Security and Medicare.
$ 50
NEW TAXES

Millionaire's tax on income above $1 million
billion
National sales tax: This would add a tax of 5 cents on every

$ 41

dollar for most purchases.

billion

Carbon tax: This option would tax carbon emissions, which

$ 40

scientists believe contribute to global warming.

billion

Bank tax: This would tax banks based on their sizes and the

$ 73

amount of risk they take.

billion

Total gap covered by

$ 304

your budget plan

billion

Surname 4
QUESTIONS
1. What is your final plan to present to the president? What changes did you decide to
implement?
The major budget cuts that seem favorable for the economy, the government, the
president as well as the citizens include:
❖ Cut foreign aid in half , which would reduce $17 billion
❖ Reduce military to pre–Iraq War size and further reduce troops in Asia and Europe,
which would help to cut $25 billion
❖ Cancel or delay some weapons programs: This would cancel some expensive purchases
identified by the Sustainable Defense Task Force as possible cuts. This would help to
reduce $19 billion
❖ Return the estate tax to Clinton-era levels: Those passing on an estate worth more than $1
million to their heirs would have portions of those estates taxed. This would help to
increase $50 billion
❖ Increase the Medicare eligibility age to 68, which would help to increase $8 billion
❖ End Bush tax cuts for income above $250,000 a year, which would increase $54 billion
❖ Millionaire's tax on income above $1 million, which would increase $50 billion
❖ Enact medical malpractice reform: This option would begin to reduce the chances of
large malpractice verdicts, which supporters believe would also check rising medical
costs. Opponents say it could reduce doctors’ incentives to avoid errors. This would
reduce $8 billion
❖ Bank tax: This would tax banks based on their sizes and the amount of risk they take.
This would increase $73 billion.

Surname 5
2. Please explain why you choose the options that you did
I chose to reduce foreign aid because it does not have real value benefits to the economy
and the government. Similarly, stopping it will not have bad effects for the government and the
economy. On the other hand, I chose to reduce military to pre–Iraq War size because the
government can main...

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