AP Gov Chapter 4.5

In 1970, the Office of Management and Budget (OMB) was created in order to:

• make Congress stay on a budget.

• pass legislation related to the budget.

• assist the president with setting national spending priorities.

• keep the Supreme Court involved with the budget.

An example of an entitlement program is:

• Social Security.

• private education.

• life insurance.

• income tax.

Presidents and Congress also practice discretionary spending, which is:

• done on items that the president and Congress feel is important.

• determined by what the voters want.

• allocated for committee business only.

• meant just for defense purposes.

The House and Senate appropriations committees are responsible for:

• overseeing the budgeting process.

• setting the budgets for the departments, agencies, and bureaus within the government.

• overseeing financial institutions like the Federal Reserve.

• depositing of public funds.

When the federal government spends less than it earns, it is called a budget __________________________.

• surplus

• deficit

• balance

• shortfall

With each budget deficit, the United States has to borrow money, which:

• increases the national debt.

• increases the national surplus.

• decreases interest rates.

• decreases the deficit.

_____ is an example of a program that the Social Security Act of 1935 created.

• Head Start

• Pell Grant

• Roth IRA

• Old Age Insurance

A solution to the problem of Social Security funding is:

• lowering the age limit for Social Security.

• increasing the deficit.

• reducing benefits to current beneficiaries.

• cutting welfare spending.

There is concern that allowing funds from Social Security to be privately invested will:

• leave the system open to corruption.

• leave many beneficiaries without funding.

• leave beneficiaries at the mercy of an unstable system.

• leave beneficiaries to figure out their own retirement.