Kate McAndrews, Mrs.

Tyler, AP Government Chapter 14 Guided Reading 3/5/2012 6:01:00 PM

Dates: 1980s through 1990s: Turmoil because of broken promises about taxes. Led to first majority Republican Congress with Republican President since 1952 1985: Republican senators started a reform to balance the budget, but the public disliked this and so they did not reelect Republicans Controversies (THIS IS VERY STEREOTYPICAL. CONSIDER YOURSELF WARNED): Income Tax: Flat vs. Progressive o This is basically the controversy between the rich and poor. It can also become a question of equal rights. Basically, those who do not earn as much as others typically want a progressive tax, which means the rich have to pay a higher income tax than them because progressive taxes are based on the amount of money in your salary. The rich usually want a flat tax, so they just have to pay the same percentage of their income as everyone else. I favor the flat tax. This is most likely because of the income in my family, but I still think the flat tax is best. If the Constitution says that everyone is equal, why should some people have to pay a higher percentage than others? It goes against all of the basic American beliefs. Everyone is equal, so their tax should be that way, too. Not everyone negatively effected by the progressive tax works as hard as those who the progressive tax positively effects, and vice versa. I believe that one of our rights as American citizens is to be treated equally, and unequal taxes goes against that. Vocab: Budget: Amount of money allowed to be spent Deficit: When theres less money in the end than you started out with Incrementalism: The best bet for the budget is last years plus a little Income Tax: A tax on income, typically graduated Graduated Tax: A tax that increases or decreases depending on your salary

Why: Income Taxes o Income taxes became legal because of the Sixteenth Amendment. This was because the government needed more money, and could not figure out how to get it. Then, they probably had a light bulb moment and thought of income taxed. They were added to the Constitution and now every person has to pay them even though no one likes them. The Budget: o First, the budget begins at the OMB. They have the information and the man power to render a fairly accurate and effective budget. Then, it goes to the President for approval. The President has been influenced by interest groups and other politicians and his own beliefs, so he will suggest/demand changes. Once they are made, he can approve it. Then, it goes to Congress. They put it in their budget committees. They have the power of the purse, so they get to decide if they want to put it into place. A budget has to happen, so after compromise, it does. Involvement: Pretty much all I can do that relates to this chapter is to pay my taxes when I have taxes. That isnt optional anyways, so I really kind of just have to pay them. Groups: The Office of Management and Budget (OMB): The OMB basically creates the budget because they have the number of people needed to do it, and the people are qualified. They have the information necessary to create, or at least attempt to create, a balanced budget The President: The President ultimately decides on the budget. He can approve the budget, suggest changes, or veto it. The President is the one who takes the fall for a faulty budget Budgets!

How:

What:

o Budgeting is a long and complex process controlled mainly by the executive branch. The executive branch creates the budget and Congress must approve. The budget involves almost all parts of the government and ends up influencing the entire country. So, if the president and the OMB screw the budget up, America isnt very happy with them. Budgets are made to please allies and win more. Decisions are made based on the favors or information given to either the president or the OMB