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Paper Topic:

Federal Budget Spending

Federal Budget Spending

2005

Outline

Introduction into Federal budget process

Federal budget overview

Proposed legislation to reduce spending

Administration plans revealed to cut down public services funding

Possible solutions for reducing budget

Before we get down to studying the Federal Budget spending it seems reasonable , from my point of view , to cover the whole process of Federal budget first and to make it clear what is Federal budget , how it works in practice and who are those legal powers who create it and control its implementation . To start

with , originally all principles for tax development and laws under which spending is guided were stipulated by the Congressional Budget Act passed in 1974 . The cornerstone of that Act is the liability laid on the Congress to develop yearly a budget resolution ' under which limits on spending and on tax cuts are set (1 2005

Hence , the process of the federal budget in brief includes the following steps : it starts with the President 's request that is followed by the budget resolution , then the latter is enforced by the floor of the House and Senate and afterwards the so-called budget reconciliation procedure will follow , which is aimed at facilitating ratification of documents concerning spending and taxes

Under more scrutiny , the first stage takes place on Monday of the second month of the current fiscal year (February ) when the President submits to Congress a thoroughly drawn budget request for the next fiscal year which starts on October 1 (1 , 2005 . This budget request is significant on the ground of three main functions it establishes . First of all it gives instructions to the Congress on how much money should be allocated for public services , how much should be collected in the form of taxes as well as establishes the threshold to the surplus or deficit which is in fact , a difference between two previous amounts . Second , the budget request highlights the President 's

Second , the budget request lays out the President 's preferences in spending , in other words , which fields of industry will get more funding and be more showered money upon (the priority list of the federal programs may include defense , education , agriculture , health , etc Furthermore , in general those priorities along with fiscal policy in a whole are set for the long-term period , let us say five years or even more

And third , the main role of the submitted budget lies in indicating some recommendations and possible reforms and changes from the President 's side . Theoretically , the President does not have to do this as the most part of the budget is governed by some permanent legislation (this refers to the two-thirds of spending and including the three largest entitlement programs such as Medicare , Medicaid , and Social Security (1 , 2005

Nevertheless , there is one point , which has to be requested by the head of the state , and this is funding for the `discretionary programs (by this term programs which are under jurisdiction of the House and Senate are denoted . All these programs are...

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