Key Concepts: Fiscal Policy and Aggregate Demand, Fiscal Policy in the United States, Fiscal Policy in Different Countries

Office of Management and Budget—National Budgeting Information

Scroll down the web page to review Chart 2-1 (Family Budgeting), Chart 2-2 (National Budgeting), and Chart 2-7 (How Your Tax Dollar is Used).

• Assess what percentage of the current projected government spending for FY2002 is "discretionary." Explain why the discretionary spending is a small share of the U.S. budget.
• Estimate how much surplus is projected by the current FY2002 budget plan. Assess what share of the surplus is planned to finance the tax cut during FY2002.
• Visit the U.S. National Debt Clock. Estimate how much interest payment has to be made each year to finance the total outstanding public debt of the United States. (e.g., 6% annual rate). What might the potential effects of maintaining this national debt be?