Basic vocabulary regarding
public policy
Debt and Deficit
• Public debt
Debt and deficit
• Public debt:
– When a government (local, state, federal) borrows
money today with the promise to pay it back
tomorrow
• How does a state or nation borrow money?
– Can get loans from banks and other governments
– Can sell promissory notes in small increments called
bonds
– When the bonds come due, the government pays the
bondholders back, with interest.
Why does the USA borrow money?
• Because it spends more than it takes in in
taxes.
• Every year, the balance between spending and
taxes results in either a deficit or a surplus.
How much money does the
government bring in?
Fiscal 2011. Amounts in Billions.
212
1091
818
Individual income taxes
Corporate income taxes
Payroll taxes
Other
348
Spending, 2011 budget.
Spending, 2011, in billions.
2
230
Discretionary defense
838
Discretionary non-defense
631
Social Security
Medicare
275
462
Medicaid
Other mandatory
Debt interest
480
725
Disaster costs
What are:
• Social security?
– income for Americans over the age of 65, based on
the amount they made during their working life
• Medicare?
– pays for health care for Americans over the age of 65
• Medicaid?
– pays for health care for poor Americans who fall
below a certain income level, partially paid by state
governments
Spending, 2011 budget.
Spending, 2011, in billions.
2
230
Discretionary defense
838
Discretionary non-defense
631
Social Security
Medicare
275
462
Medicaid
Other mandatory
Debt interest
480
725
Disaster costs
Agriculture
Discretionary non-defense spending, 2011
Commerce
Education
Energy
Health and Human Services
Housing and Urban Development
Interior
Justice
Labor
State (non-defense related)
Transportation
Treasury
Corps of Engineers
EPA
General Services Admin.
NASA
National Science Foundation
Small Business Admin
What is discretionary non-defense
spending?
What is the budget deficit for 2011?
• Receipts:
• Expenditures:
• Deficit
2.303 trillion
3.603 trillion
1.300 trillion
Debt and Deficit
• Public debt
• The national debt
• The NATIONAL DEBT is the total amount of
money that the US federal government in
Washington OWES to bondholders.
• This is the total amount of all debts
PREVIOUSLY accumulated
The National Debt
16,000,000,000,000.00
14,000,000,000,000.00
12,000,000,000,000.00
10,000,000,000,000.00
8,000,000,000,000.00
6,000,000,000,000.00
4,000,000,000,000.00
2,000,000,000,000.00
9/1/2007
12/1/2003
3/1/2000
6/1/1996
9/1/1992
12/1/1988
3/1/1985
6/1/1981
9/1/1977
12/1/1973
3/1/1970
6/1/1966
9/1/1962
12/1/1958
3/1/1955
6/1/1951
0.00
Demography: who are we?
• Population 2010: 308,745,538
• Percent change from 2000: 9.7%
Race
% of population
White
Black
Native American
Asian
Hispanic/Latino
Other
Two or more
Demography: who are we?
• Income distribution:
• Median household income: $51,914
• Poverty rate: 15%
• Lowest 20% of the population (about 61 million people):
– Household Incomes of $20,000 or less.
• Next lowest 20%: Incomes from $20,000 to $38,043
• Middle 20%: Incomes from $38,044 to $61,735
• Next highest 20% Incomes from $61,736-$100,065
• Highest 20%: Incomes above $100,065
Public Opinion
• What do most Americans think about:
•
•
•
•
Taxes and spending
War and defense
Abortion
The environment
"In order to lower the nation's budget deficit, do you think taxes should be
increased on households earning one million dollars a year or more, or
should the government address the budget deficit without increasing taxes
on those households?“
CBS News/New York Times Poll. Feb. 8-13, 2012. N=1,197 adults nationwide. Margin of error ± 3.
80
70
60
50
40
30
20
10
0
Should increase
Should not increase
Unsure
"Do you feel you pay more than your fair share in federal
income taxes, less than your fair share, or is the amount you
pay about right?“CBS News/New York Times Poll. Jan. 20-23,
2012. N=1,185 adults nationwide. Margin of error ± 3.
60
50
40
30
20
10
0
More than fair
share
About Right
Less than fair share
Unsure
"In order to balance the federal budget, which should be the
main focus of lawmakers: increasing taxes or cutting
government services?“AP-GfK Poll conducted by GfK Roper Public Affairs
& Corporate Communications. Dec. 8-12, 2011. N=1,000 adults nationwide.
Margin of error ± 4. Options rotated. 11/10: Co-sponsored by CNBC.
70
60
50
40
30
20
10
0
Increasing taxes Cutting services Both equally
Neither
Unsure
Please tell me how important you think it is for Congress to reach
agreement on each of the following BEFORE THE END OF THIS YEAR. First,
how important is it that Congress agrees on [see below]? Is it very
important, somewhat important, not too important, or not at all important
for Congress to do this before the end of this year?"
80
70
60
50
40
30
20
10
0
Create jobs by
Reduce the federal Reduce the federal
spending more on deficit by cutting deficit by cutting
roads, schools, and
spending and
spending on
police
raising taxes on the
Medicare and
rich
Medicaid
Very important
Somewhat important
Not important at all
Unsure
Create jobs by
cutting social
security payroll
taxes
Not too important
United Technologies/National Journal Congressional Connection Poll conducted by Princeton Survey Research Associates International.
Nov. 3-6, 2011. N=1,005 adults nationwide. Margin of error ± 3.7.
"Which of these comes closest to your view? Abortion should
be generally available to those who want it. OR, Abortion
should be available, but under stricter limits than it is now. OR,
Abortion should not be permitted.“CBS News/New York Times
Poll. Jan. 12-17, 2012. N=1,154 adults nationwide. Margin of
error ± 3.
40
35
30
25
20
15
10
5
0
Generally available
Available under
stricter limits
Not permitted
Unsure
"Which comes closer to your point of view? As a general rule, do you think
the United States should be ready and willing to use military force around
the world, or the United States should be very reluctant to use military
force?" Version A (N=513, MoE ± 4.5) CNN/ORC Poll. Nov. 18-20, 2011. Adults
nationwide.
60
50
40
30
20
10
0
Ready and willing
Very reluctant
Unsure
"In general, do you think it should or should not be the role of
the United States to promote the establishment of democratic
governments in other countries?“AP-GfK Poll conducted by GfK
Roper Public Affairs & Corporate Communications. March 24-28,
2011. N=1,001 adults nationwide. Margin of error ± 4.2.
5
4
3
2
1
0
Should
Should not
Unsure
"Turning to the issue of foreign aid, do you think the United States is now
spending too little on foreign aid, about the right amount, or too much on
foreign aid?“ Washington Post/Kaiser Family Foundation/Harvard University poll
conducted by Princeton Survey Research Associates. June 13-23, 2002. N=1,402 adults
nationwide. MoE ± 3.
60
50
40
30
20
10
0
Too little
Right amount
Too much
Don't know
"What do you think the United States should do to get Iran to shut down its
nuclear program: take military action against Iran now, use economic and
diplomatic efforts but not take military action right now, or take no action
against Iran at this time?“CNN/ORC Poll. Feb. 10-13, 2012. N=1,026 adults
nationwide. Margin of error ± 3.
70
60
50
40
30
20
10
0
Military action
Economic and
diplomatic efforts
No action
Unsure
"From what you've read and heard, is there solid evidence that the average
temperature on earth has been getting warmer over the past few decades, or not?"
If yes: "Do you believe that the earth is getting warmer mostly because of human
activity such as burning fossil fuels, OR, mostly because of natural patterns in the
earth's environment?" Options rotated. Pew Research Center. Nov. 9-14, 2011.
N=2,001 adults nationwide. Margin of error ± 3.
40
35
30
25
20
15
10
5
0
"Which of the following statements comes closest to your views on the origin and
development of human beings? (1) Human beings have developed over millions of
years from less advanced forms of life, but God guided this process. (2) Human
beings have developed over millions of years from less advanced forms of life, but
God had no part in this process. (3) God created human beings pretty much in their
present form at one time within the last 10,000 years or so." Options rotated 1-3, 31. Gallup Poll. Dec. 10-12, 2010. N=1,019 adults nationwide. Margin of error ± 4.
45
40
35
30
25
20
15
10
5
0
Developed, guided
by God
Developed, God
had no part
God created in
present form
Other/unsure
"Right now, which ONE of the following do you think should be the more
important priority for U.S. energy policy: keeping energy prices low or
protecting the environment?" Options rotated Pew Research/National
Journal Congressional Connection Poll, sponsored by the Society for Human
Resource Management. June 10-13, 2010. N=1,010 adults nationwide. MoE ±
4.
60
50
40
30
20
10
0
Energy prices low
Protecting environment
Unsure