Government spending- a mind map by Conner Cormier, Megan Ulrich, Hannah Hodges, Tori Taylor and P...

1. balanced budget

2. budget surplus

3. budget deficit

3.1. deficit spending

3.1.1. national debt

3.2. causes of deficit spending

3.2.1. national emergencies

3.2.2. a desire for more public goods

3.2.3. stabilization of the economy

3.2.4. the role of the government in society

3.3. borrow money to care for excess spending not afforded

3.3.1. takes out bonds- type of bonds

3.3.1.1. Treasury bills

3.3.1.1.1. short term bonds that mature in less than one year

3.3.1.2. treasury notes

3.3.1.2.1. bonds that mature between two and ten years

3.3.1.3. treasury bonds

3.3.1.3.1. issued for 30 years

3.3.2. Trust funds

3.3.2.1. funds for specific purposes to be used at a later date. i.e. Medicare, Medicaid, Social Security

3.4. Government competes with private sectors to raise money

3.4.1. Crowding out effect

3.4.1.1. Government outbids private bond interest rates to gain loanable funds. Money leaves private sector and interest rate increases