Spending and the Federal Budget

Uncontrollable Spending

This is also known as mandatory spending. The level of spending cannot be changed unless Congress changes the law(s) that set the funding for those programs. A majority of uncontrollable spending goes towards entitlement programs. Once Congress sets the standards of eligibility for these programs, it cannot adjust how much the government spends.

Discretionary Spending

The spending amounts on specific budget items that Congress and the President make choices on each year. The military takes 50% of all discretionary spending.

The Federal Budget

Estimate of government spending for the next fiscal year, it declares public policies of the United States.

Creating the Budget

  1. President presents budget to Congress
  2. House and Senate working together to determine size of budget
  3. Appropriations Committees set spending for different sectors
  4. President approves the budget

Approving the Final Budget

Continuing resolutions allow affected agencies to continue to function based on the previous year's appropriations. These help to avoid government shutdowns.

Ways to Balance the Budget

  • Entitlement reform
  • Reduction in discretionary spending

Why is it so difficult to balance the budget?

Congress members' reelections could be put in jeopardy. Also, citizens' interest group' and the media's criticism and opposition to certain cuts makes it impossible to please everyone.

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