G16: Budget Free Response

Many people are concerned about large deficits in the federal budget. Rarely does the government balance its budget.

(a) Define balanced budget.

• A balanced budget is when revenue is equal to expenditures, and no budget deficit exists. 

(b) Define federal entitlements.

• Federal entitlements are payments made to groups based on criteria set by the government. 

(c) Identify an entitlement. Explain how entitlements are a barrier to the federal government achieving a balanced budget.

• An entitlement is something like Medicare or Social Security. It is a barrier to the federal government because money is being used to support retired Americans. The only reason why it is a problem is because America does not tax people equally, and fails to sustain the ratio of taxes to entitlements. 

(d) Describe a consequence of large budget deficits.

• A major consequence of budget deficits is the Unemployment rate increases. Many people loose their jobs because most companies do not have the money to have them as an employee. 

(e) What is the current budget deficit? See if you can find out online from a reputable source -- and cite your source.

• $635 Trillion dollars- From http://usdebtclock.org/