1. “U.S. Federal Tax Receipts” are the taxes that the government collected for one full year in 2013. In order, what are the three top sources of revenue and the percent of total revenue that each represents?

Individual income 1.316 billion 48%, Social Security and social insurance 948 billion 34%, corporate income 274 billion 10%

  1. What is the difference between “mandatory” and “discretionary” spending?

Mandatory spending are required by laws and discretionary spending is everything else.

  1. In 2013, how much money did the government collect in taxes and how much money did the government spend? (This will be in trillions of dollars is can be found on slides 3&5)

The government collected $2.7 trillion and spent $3.45 trillion

  1. What were the top three sources of government spending in 2013? What percent of total spending did each of these expenditures represent? Also, what percent of total spending was “mandatory” spending 2013?

Medicare and Medicaid $851 billion 25 percent, Social Security $808 billion .23 percent, Defense Department $625 billion 18 percent. Mandatory spending accounted for 59% of the total money spent by the US government. The government spent $3,454 billion in mandatory spending.

  1. In 1960, how many workers were paying taxes to support each person receiving Social Security benefits? What would you estimate that number to be today?

In 1960 5.1 workers for every one person on Social Security so 5.1 to 1 ratio, today it is about 2.5 to 1 so 2.5 people working for everyone receiving Social Security.

  1. When during the last 45 years has the government run “surpluses”? (meaning that it collected more in taxes than it spent in any given year)

1998-2001 were the only years the government did not spend more money than it collected.

  1. Approximately what was the national debt in 1980? 1996? 2007? Today?

1980- .8 trillion , 1996- 5 trillion , 2007- 9 trillion, 2014- 18 trillion


 

  1. What was true of U.S. military spending in 2010 and how did the U.S. compare to other countries in this regard? (Fact: there are over 190 countries in the world)

2010 military spending $533.8 billion in USA, military spending in the whole world United States 43%, China 7%, France 4%, Russia 3%, rest of world 39%

Krugman Article

  1. What is the thesis of Krugman’s article? (put it into your own words)

People in the US feel like we live in the richest country in the world but our country has so much money compared to other nations because our rich are so much richer. Our middle class is not doing as well as other countries and are poor are much more poor and there is a lot more in terms of percentages of poor in the United States than there are in other industrialized nations.

  1. What does Krugman mean when he says we are entering a “New Gilded Age”? What specific information does he give to support this claim?

Between 1979 and 1997 the income of the top 1% of families rose 157%. There was only a 10% gain for families in the middle income.

  1. What was “The Great Compression”? What specific information was given to support this idea?

The great compression is the narrowing of income gaps during the new deal and World War II because the income at the top levels dropped sharply. Incomes then stayed equal until the 1970s where there was a rapid rise in incomes across the population. Since the 1970s we are back to the days of the great Gatsby the top 10% of taxpayers in the top 1% were far below the levels of the 1920s are all nearly back where they were and the big winner is the very very rich.

  1. According to Krugman, why do most people assume that the standard of living in the U.S. is higher than in other countries? What is wrong with this logic?

We are the richest major nation in the world and most people think that because we are the richest nation in the world that would translate into a high standard of living for everybody but that’s not true. America has a higher income than any other country because our rich are much richer. In Sweden the poorest 10% of the population have incomes that are 60% higher than the same population in the United States. And very few people in Sweden have deep poverty that is common in the United States only 6% of Swedes live this way and 14% of people in the US are very very poor.