FrontPage: Have powers wrksht on your desk.

The Last Word: No homework

Today, I will scare you…

The Powers of Congress

A Thought on the Powers of Congress“The main lawmaking responsibility rests with Congress, and

its powers under the Constitution are awesome.(what would be examples of these Expressed powers?)

Formally, it has the power to wipe out with a single law the entire executive branch, except for the president and the VP,

and to abolish all federal courts, except for the Supreme Court, which it could reduce to a single judge with minor

jurisdiction (area of control).

 Over the years the Courts have interpreted Congress’ powers in such sweeping terms that it can legislate in almost every

aspect of American life.”(What would be an example of these Implied powers?)

Lee Hamilton – Member of House of Representatives (1965 – 1999)

The Power$ of Congress

Which of the powers of Congress might be the most important?

Why?

Which powers of Congress are grouped under this category?

The Power$ of the Pur$e are the MOST IMPORTANT of all Congressional powers…

Why…?

Let’s discuss the first “Power of the Pur$e”…

But first, let’s learn a bit of wisdom from a founding father…

Ben Franklin said that in life, only 2 things are certain…

What are these 2 things…?

One is Death…

The other is…

Taxes…

The Power of Taxation…

Congress has the sole power to levy (“set” or “apply”) many different national taxes… – Why would the

Framers have given only Congress this power?

• **Why does Congress tax the American people

• What are revenues?

Originally, there was only one

source of income for the

national government

Tariffs: – What are tariffs?

…but this was not enough…

So, what did the government do to fix this?

Passed the 16th amendment:Created the income tax…–This has become a

major source of income for the government…

…And a despised part of everyone’s paycheck!

Sources of revenue - 2009

$pending Power When Congress allocates (spends, or

gives) money to a program, agency or other part of the government, this funding is called…

**Where must all “appropriations” or “revenue” bills begin?

• Why do you think this is the case?

What we “choose” to spend on…

The Federal Budget

This is an outline of how much the government will spend in a given year

Where is all of this spending recorded so we can keep track of it?

The Federal Budget:Terms to Know

Budget Surplus– Occurs when government spends less

in a single year than it brings in  Budget Deficit

– Occurs when the government spends more in a single year than it brings in

 **For example: In 2009, the US government took in about $2 trillion and spent about $3.4 trillion.

Why would the government need to spend more than it brings in?

When this happens, Congress must use another “Power of the Pur$e”…

**Which power of Congress enables it to spend more than it has?

The Power to Borrow Money

But when Congress does this, it contributes to the…

The total accumulated amount that government owes; Occurs because more deficit years occur than surplus years.

National Debt

The National Debt as of 12 Dec 2007 was:

The estimated population of the United States is 307,592,396so each citizen's share of this debt is $39,542.84.

The National Debt has continued to increase an average of

$3.81 billion per day since September 28, 2007!

Source: http://www.brillig.com/debt_clock/

The US National Debt as of 4 Jan 2010 is:

The increase of the National Debt

Who Owns the Debt?

4%

47%

28%

3%12%3%

3% State and Local Gov-ernments

The US Government

Foreign Governments

Individual Investors

Public/Private Funds

Insurance Companies

Banks

Who Owns the Debt?

Foreign and International Ownership – about 1/3rd of

total

We hear a lot about the “deficit”, “debt”,"stimulus packages" and "bailouts"...

A billion dollars....A hundred billion dollars...One TRILLION dollars… What does that look like?

– Let’s try to get a sense of what exactly a trillion dollars looks like.

We'll start with a $100 dollar bill, which is currently the largest U.S. denomination in general circulation.

$10,000 in $100 bills A packet of one hundred $100 bills is less

than 1/2" thick and contains $10,000. – It fits in your pocket easily and is more than

enough for week or two of shamefully decadent fun.

$1 million in $100 bills Believe it or not, this next little pile is $1

million dollars (100 packets of $10,000).

You could stuff that into a grocery bag and walk around with it.

$100 Million in $100 bills While a measly $1 million looked a little

unimpressive, $100 million is a little more respectable. It fits neatly on a standard pallet...

And $1 BILLION dollars...

Now we're really getting somewhere...

Next we'll look at ONE TRILLION dollars.

This is that number we've been hearing about so much.

What is a trillion dollars? – Well, it's a million millions. It's a thousand billion. It's

a one followed by 12 zeros.

You ready for this? It's pretty surprising.

I give you $1 trillion dollars…

$cary, isn’t it? Should be…especially given that

Congress and the President authorized nearly $1 trillion in extra “stimulus” spending just in 2009

What is the consequence of all this “deficit spending”?– How might we start to reduce our

yearly deficit, and our national debt?

The Real Issue?