Division of Accounting and and Finance
May 28, 2020
Economics for Decision Making Question 1 Topic 1: Demand and supply analysis a. Thredbo is a small alpine village in the heart of the New South W
May 28, 2020

United States Budget

United States Budget
STEP I. First, use our lecture to find out how the Federal Government spends your tax dollars. You may also google "national budget" for additional websites.
Next, you must work on your changes in a simulator. Go directly to the simulator at http://www.nathannewman.org/nbs/longbudget06.html to make changes (or if you want a more sophisticated simulator go to http://crfb.org/stabilizethedebt/ make choices and click next) Make sure you think about each change and write them down. You will need to discuss these changes in your Written Assignment. You must choose at least 3 areas to change that are not related (i.e. they are not all under Military). You may increase or decrease spending in each area. That is up to you.
1. State the three areas that you changed and by how much.
Pretty simple. Three areas and the specific numbers from the simulator.
2. Discuss and thoroughly explain these changes.
Change #1 €“
Explain WHY this change should be made. Be specific.
Here you need to give some pretty serious thought. Don’t just say you believe in smaller government or that you believe people deserve more services. Why is this increase or decrease needed and what might it affect?
Explain HOW this change could be made and/or what obstacles you might encounter. BE SPECIFIC.This section in all three areas will be weighted with the most points as it really illustrates your understanding of the political process/system we’ve been discussing all semester.
How is a budget passed, discretionary vs. mandatory spending, divided government, lobbyists, public opinion, campaigns, political party platforms, etc
This is where many miss points and where the bulk of points are weighted. You need to provide an in-depth analysis of the political process from what voters/people/special interest groups might support your ideas (through campaign financing/lobbying/public opinion polls or pressure); to how a bill is passed in Congress (or not).
You need to understand the difference between making changes to mandatory spending as opposed to discretionary spending. Moreover, what the implications of having a divided government and how this may or may not cause gridlock. Consider if Democrats, Republicans would support or oppose your bill. You might include how bills are passed through Committees and/or sat on and killed, or if passed by both the House and Senate (and don’t forget the filibuster on the Senate floor), that they need to go to Conference Committee to hammer out one version for the President. How about the President and his use of the bully-pulpit? And if the President vetos your bills, then what?

Change #2 €“
Explain WHY this change should be made. Be specific.
Explain HOW this change could be made and/or what obstacles you might encounter. BE SPECIFIC.
Change #3 €“
Explain WHY this change should be made. Be specific.
Explain HOW this change could be made and/or what obstacles you might encounter. BE SPECIFIC.
3. Discuss and fully explain the ramifications of your changes.
Did you increase or decrease the budget deficit? By how much? Consider how would this fit in a 10 or 15 year plan to reduce the current deficit? What about the national debt and the debt to GDP ratios? Would you need to increase taxes to help pay it off? What sacrifices might have to be made if you reduce services? How might these be off-set in the private sector? Specific numbers may not be necessary, but you should provide a thorough analysis of the effects of your changes.