Interest Groups
...flation 4. Presently 30 = 40- Supply > Demand Depression- too little money in the hands of the consumers. Inflation- too much money in the hands of the consumers. Fiscal Policy Taxation Lower or Raise Taxes Government Spending Revise or Lower Monetary Policy Direct Supply (control of money) Federal Reserve System- Bank of Banks o Vary Rate of Interest o Alan Greenspan in charge Recession, Interest lowers Inflation, Interest raised Q3.) Where does the money come from? A 1. Individual Income Tax (progressive) a. Puts burden on the rich b. Rate of taxation increases 2. Social Insurance (payroll tax) a. Regressive b. Puts burden on poor and middle class c. Flat tax (regressive) d. Same rate of interest 3. Corporate Income Tax a. Progressive 4. Borrowing a. 1969-1998- Deficit b. 1998-2001-Surplus c. 2002- Deficit 5. Other 6. Excise Tax- Luxury Tax B Objective of Taxation 1. Raising Money 2. Regulation of Human Behavior 3. Promoting Economic Growth Two Types of Taxes- Progressive, and Regressive Q3.) Where the money went (2002 Budget – 5 Government Expenditures) 1. Direct Benefit Payments for Individuals 2. Defense 3. Interest on Federal Debt 4. Grants to states and localities 5. other federal operations Q 4.) Difference Between them (in 2002) A. Deficit $ 100 Billion B. Debt $2.5 Trillion C. Deficit =Expenditures > Receipts per year in a budget National Debt = total money borrowed over the years up hill now and still standing. 7.) Interest Groups- a collection of individuals who share a common set of ideas or principles and who attempt to advance those ideas or principles by influe...