5/23/2020 Transcript media.capella.edu/CourseMedia/POL1000/BalanceTheBudget/transcript.html 1/7 P r i n t BALANCING THE BUDGET SIMULATION Welcome to the Balancing the Budget simulation! Your goal with this simulation is to balance a hypothetical government budget by choosing spending priorities. Though the totals are much lower than the actual budget, the proposed increases and decreases are realistic �gures (similar to increases and decreases that have actually been proposed). The choices and tradeo�s you make here are very similar to what Congress does, except that your choices tend to be easier. For the simulation, assume that no changes (no increases or decreases in spending) will result in a $25 billion de�cit, so you must cut $25 billion to balance the budget. This activity provides a high-level understanding of the di�culties public o�cials face when considering budget changes. When you make changes to the budget categories, try to put yourself in the role of a public o�cial. Consider your background, experiences and personal beliefs, but also imagine yourself as a public o�cial elected by voters in your home state. You have a responsibility to support and advance the needs of your constituents. Cutting and increasing budgets can have far reaching implications to the standard of living, growth, and overall economy, both in your home state and throughout the country. Cutting funds to Transportation could mean both a reduction of the workforce and less money spent on the improvement of roads. Deteriorating roads could lead to more accidents and higher health and insurance costs. The point is that a simple decision to make a cutback to an area can a�ect far more than just that area, so try to consider these things when you make your choices. Area 1: National Defense The �rst area deals with National Defense. You'll notice three categories on the left. Click on one to get started and determine what cuts or increases you want to make to that category. Remember, changes to the National Defense budget not only a�ect military personnel, but also companies that supply products and services for National Defense, and the security of our nation. Categories include: Salaries and bene�ts for military personnel. Proposed: $104.7 billion. There are many stories of military families struggling to make ends meet. Furthermore, the all-volunteer military relies on decent pay and bene�ts in order to attract new recruits and reenlistments. Finally, in the past few years, many military personnel have undergone signi�cant hardship in overseas postings. Reductions may not exceeding $10 billion. Research & development, testing and evaluation Proposed: $63.5 billion. Research and development is critical to maintaining a highly e�ective military. Technological advances such as surveillance drones can reduce or eliminate the risk to military personnel and greatly increase capabilities. Continued investment is needed to maintain America's technologica.

1. 5/23/2020 Transcript
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P r i n t
BALANCING THE BUDGET SIMULATION
Welcome to the Balancing the Budget simulation! Your goal
with this simulation is to balance a hypothetical
government budget by choosing spending priorities. Though the
totals are much lower than the actual budget,
the proposed increases and decreases are realistic �gures
(similar to increases and decreases that have
actually been proposed). The choices and tradeo�s you make
here are very similar to what Congress does,
except that your choices tend to be easier. For the simulation,
assume that no changes (no increases or
decreases in spending) will result in a $25 billion de�cit, so
you must cut $25 billion to balance the budget.
This activity provides a high-level understanding of the
di�culties public o�cials face when considering budget
changes. When you make changes to the budget categories, try
to put yourself in the role of a public o�cial.
Consider your background, experiences and personal beliefs,
but also imagine yourself as a public o�cial
elected by voters in your home state. You have a responsibility
to support and advance the needs of your
constituents.

2. Cutting and increasing budgets can have far reaching
implications to the standard of living, growth, and overall
economy, both in your home state and throughout the country.
Cutting funds to Transportation could mean
both a reduction of the workforce and less money spent on the
improvement of roads. Deteriorating roads
could lead to more accidents and higher health and insurance
costs. The point is that a simple decision to
make a cutback to an area can a�ect far more than just that
area, so try to consider these things when you
make your choices.
Area 1: National Defense
The �rst area deals with National Defense. You'll notice three
categories on the left. Click on one to get started
and determine what cuts or increases you want to make to that
category. Remember, changes to the National
Defense budget not only a�ect military personnel, but also
companies that supply products and services for
National Defense, and the security of our nation. Categories
include:
Salaries and bene�ts for military personnel.
Proposed: $104.7 billion.
There are many stories of military families struggling to make
ends meet. Furthermore, the all-volunteer
military relies on decent pay and bene�ts in order to attract new
recruits and reenlistments. Finally, in
the past few years, many military personnel have undergone
signi�cant hardship in overseas postings.
Reductions may not exceeding $10 billion.
Research & development, testing and evaluation
Proposed: $63.5 billion.
Research and development is critical to maintaining a highly
e�ective military. Technological advances

3. such as surveillance drones can reduce or eliminate the risk to
military personnel and greatly increase
capabilities. Continued investment is needed to maintain
America's technological edge. Note that this
amount does not include the cost of existing weapons systems
that are being purchased.
Reductions may not exceeding $5 billion.
Department of Homeland Security
Proposed: $94 billion.
Many argue that we need more money for domestic security.
Local law enforcement agencies are being
forced to bear a considerable burden for what should be a
national obligation (anti-terrorist activities).
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Furthermore, numerous systems important to our security
remain in dire need of upgrading. For
instance, the 9/11 commission has concluded that ine�ective
communications systems probably cost
many lives because warnings could not be communicated
e�ectively before the World Trade Center
towers collapsed. Funding for the Dept. of Homeland Security
has been �at (i.e., no increases) the past
few years.
Reductions may not exceed $5 billion.
Area 2: International A�airs
Area 2 focuses on International A�airs. There are �ve main

4. categories to consider in this area. Though it might
seem like a good area to make some cuts, remember that we are
living in a global society. Contributing to the
increased health and well-being of other countries can help
build and strengthen ties with those countries.
Building and improving existing relationships with allies can
lead to many positive and long-term a�ects at
home.
Development assistance, child survival, and disease programs
Proposed: $2.8 billion.
Development assistance helps poor countries with programs that
can raise their citizens out of poverty.
For relatively small amounts, child survival and anti-disease
programs can save thousands of lives. Areas
such as Africa are plagued by diseases that kill tens of
thousands, but many of these can be prevented
or treated e�ectively, with more �nancial assistance.
Reductions may not exceed $0.5 billion.
Food aid
Proposed: $1.2 billion.
This assistance can help avert or moderate humanitarian
disasters and prevent starvation. Children are
the most likely victims if there is insu�cient food aid.
Reductions may not exceed $0.5 billion.
Assistance for the independent states of the former Soviet
Union
Proposed: $0.6 billion.
Many of these countries are potential breeding grounds for
terrorism. Unless stable governments are
promoted, groups hostile to the United States are likely to be
able to establish bases in some of these
countries. Furthermore, some of these countries continue to
possess nuclear weapons materials, but

5. their security is weak. Assisting these countries in safeguarding
these weapons-and, ideally, buying them
from these countries-will greatly bene�t the United States.
Reductions may not exceed $0.3 billion.
Refugee programs
Proposed: $0.8 billion.
These programs help refugees �eeing dangerous conditions in
their home countries. Although a small
amount of money may be used to assist a few refugees in
moving to the United States, most of the
money goes to providing assistance to refugees in other
countries (e.g., providing food for refugee
camps).
Reductions may not exceed $0.2 billion.
Foreign military �nancing grants and loans
Proposed: $4.3 billion.
Most of this money goes to allies, helping them strengthen their
defense. In some cases, recipients are
actively �ghting terrorist threats that also threaten the United
States. Without this assistance, poorer
countries would struggle against terrorist and other armed
threats.
Reductions may not exceed $0.5 billion.
Area 3: Science, Space and Technology
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This area covers the broad grouping of science, space and

6. technology. You'll notice three categories for which
you can make increases and decreases. Consider your personal
views when you try to decide what to do in
these areas, but also consider the impact on your constituents.
Does your state have businesses that support
any of these categories? Would cuts or increases have a
signi�cant economic impact? And what about the
long-term e�ects to education and culture?
National Science Foundation programs
Proposed: $5.2 billion.
These fund a wide range of activities, from basic research to
educational tools for use in grade schools.
Federal government funding of basic research is widely seen as
critical in laying the groundwork for
innovations and advances that greatly enrich the nation and
improve the quality of life for its citizens.
Many scientists are worried that government research funding is
inadequate, and will cause the U.S. to
lose an important advantage it has over competitors around the
world.
Reductions may not exceed $0.5 billion.
Science, aeronautics, and technology
Proposed: $8.2 billion.
This helps to fund the spectacular feats of space science
witnessed over the years, such as the Hubble
telescope, missions to the outer planets in the solar system,
exploration of Mars, and much more. Some
space scientists worry that funding is insu�cient, as
demonstrated by NASA's recent plan to shut down
the Hubble because of lack of funding for maintenance and
upgrades.
Reductions may not exceed $2 billion.
Human space �ight

7. Proposed: $6.7 billion.
This �gure may need to be increased substantially if we attempt
to send astronauts to Mars.
Reductions may not exceed $3 billion.
Area 4: Environmental Protection
There are two categories in this area but both can have far
reaching implications, so give some thought to the
rami�cations of your changes. Remember, population in the
United States continues to grow. Does this have
an impact on your decision?
Pollution control: regulation, enforcement, and research
Proposed: $3.2 billion.
This money helps to fund regulation of polluters, and
enforcement of anti-pollution laws. It also helps
fund research into pollutants and ways to reduce pollution.
Reductions may not exceed $2 billion.
Superfund
Proposed: $1.4 billion.
This fund helps to clean up some of the worst environmental
hazards. There are currently hundreds of
seriously polluted cites waiting for Superfund funding, but there
is not enough money to clean them all
right now.
Reductions may not exceed $0.5 billion.
Area 5: Farm Income Stabilization
Area �ve has just the one broad category to select from.
Consider whether or not your state relies on farming
as a key economic indicator. Farming is a capital intensive
profession and is very dependent on numerous
uncontrollable factors. Also, remember that farming is at the
heart of our most basic need!

8. All Farm Income Stabilization Programs
Proposed: $16 billion
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These programs range from price supports to crop insurance.
Many small farmers worry that they would
lose their farms without federal assistance.
Reductions may not exceed $2 billion.
Area 6: Transportation
There are two key categories for decision making purposes in
the area of transportation. As mentioned on the
opening page, increases and decreases in the transportation
budget can have far reaching impacts in all
states. There are economic considerations beyond the obvious
when you consider that numerous businesses
o�er products and services in this area.
Highways
Proposed: $29.5 billion.
Although states provide substantial amounts of money for
highway maintenance, repair, and expansion,
they also rely heavily on federal money. A growing coalition
worries that we have underfunded
transportation, leading to the rapidly increasing congestion that
can be seen throughout the country,
where congestion has increased greatly in the past �fteen years.
Reductions may not exceed $2 billion.
Mass Transit (buses, subways, light rail, etc.)

9. Proposed: $7.1 billion.
This is a half billion dollar decrease over the actual 2002
expenditure. In real terms, the decrease is even
greater. Advocates of mass transit argue that it plays a major
role in reducing peak hour congestion
(congestion during rush hour) and greatly reduces pollution and
reliance on imported oil. However,
declining government funding often results in cuts in service
and increases in fares, leading to declining
ridership and greater dependence on cars. This in turn fuels
greater congestion, more pollution, and
greater dependence on foreign oil.
Reductions may not exceed $0.5 billion.
Area 7: Education
This area covers the hot topic of Education. There are four main
categories in education and most have the
added complexity of being a�ected by both federal and state
budgets. Many of the short-term rami�cations of
increases or decreases to this budget item are obvious, but what
about long-term e�ects? Do you view
Education as a responsibility of the federal government, or of
state and local governments? How important are
extracurricular activities, like sports teams or arts events, to
you? These are all things to consider when making
changes to this budget area.
Education for the disadvantaged
Proposed: $14.2 billion.
This is the largest single line item for K-12 education. State and
local governments provide most of the
funding (95%), but funding for disadvantaged children would
likely su�er greatly without federal
assistance, because these children often have greater needs.
Without a substantial federal commitment,
it may be very hard to provide these children an adequate

10. education that would give them a good
chance to move out of poverty when they grow up. Many
educators believe that far more funding is
needed.
Reductions may not exceed $3 billion.
School improvement
Proposed: $5.6 billion.
This helps school districts construct new schools and renovate
old ones. In growing suburbs, students
are often crammed into schools built to hold far fewer bodies.
In older districts, asbestos-laden pipes,
mold, leaking roofs, and other problems plague many schools.
Reductions may not exceed $2 billion.
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Special education
Proposed: $10.4 billion.
Over a quarter century ago, the federal government passed a law
requiring that disabled students be
given educational opportunities equal to all other students, and
promised to pay 40 percent of the cost.
The federal government has never kept its promise, and state
and local districts struggle to pay for the
share that the federal government is supposed to provide.
Increasing the federal government share by
50 percent or more would greatly aid state and local e�orts to
strengthen education.
Reductions may not exceed $0.5 billion.

11. Higher education-�nancial aid
Proposed: $14.6 billion.
Many students struggle to pay tuition and other college costs.
This represents about a 10 percent
increase in federally-funded �nancial aid (e.g. Pell Grants).
Reductions may not exceed $1 billion.
Area 8: Health Care
You'll notice four categories to choose from in the area of
health care and a brief explanation is provided for
each. The rising trend in health care costs a�ects these areas as
well, so consider that in your decision making
process.
Substance abuse and mental health services
Proposed: $3.4 billion.
Millions of Americans struggle with the e�ects of chemical
dependency and substance abuse, either on
themselves or on someone close to them. This funding helps
provide treatment and other services.
Reductions may not exceed $0.5 billion.
National Institutes of Health
Proposed: $27.5 billion.
This is one of the front lines in the battle against diseases and
other health threats. The National
Institutes of Health help to fund research into a vast array of
health problems, from new antibiotics to
viruses that might be used by terrorists. The dramatic progress
against AIDS is due in part to NIH-funded
research. Today, Americans are threatened not only by many
serious health threats, but also fact the
likelihood that new ones will be brought to this country by
world travelers. NIH research represents one
of the most important e�orts to combat these threats.
Reductions may not exceed $1 billion.

12. Medicaid
Proposed: $192.8 billion.
Although massive, this program struggles to provide health care
for the poor. Growing numbers of
doctors turn away new Medicaid patients because
reimbursements are so low. Furthermore, the
working poor often receive no Medicaid bene�ts, so millions of
Americans still have no health coverage.
Many would like to see this program expanded-or similar ones
started-to cover more working poor.
Reductions may not exceed $10 billion.
State children's health insurance fund
Proposed: $4.9 billion.
Even when parents cannot get health coverage, state programs
will often provide some coverage for
their children. Still, there is a pressing need for more coverage
in areas such as mental health care. Good
health care for children is widely seen as an extremely
bene�cial investment, because this can help
prevent later serious health problems. Faced with tight budgets,
many states are considering cutting
back on health care for children, unless the federal government
increases funding.
Reductions may not exceed $0.5 billion.
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Area 9: Housing
There is one category for you to consider in the housing area,

13. but it is an important one. As stated in the
description, the implications can be far-reaching. What are your
beliefs here? Does it make a di�erence if you
are a�liated with one of the major political parties? Do your
budget considerations change based on the
needs of your home state?
Subsidized, public, homeless and other HUD housing
Proposed: $28.9 billion.
Millions of Americans struggle to a�ord adequate housing, and
thousands of families with children are
homeless. Decent housing appears to be bene�cial in many
other ways as well, such as helping children
do better in school and making it easier for adults to �nd
employment. Many activists believe that there
is a serious shortage of a�ordable housing, and would like to
see the federal government provide more
assistance. Private e�orts (such as Habitat for Humanity) are
miniscule compared to what the federal
government can do.
Reductions may not exceed $2 billion.
Area 10: Income Security
The four categories dealing with income security are hot topics
in any budget discussion. Does your party
a�liation a�ect your decisions in this area? What are your
personal views on each of the categories? What are
some of the far reaching rami�cations of increases or decreases
in income security? Consider these things as
you make your budget decisions.
Special supplemental food program for women, infants, and
children (WIC)
Proposed: $4.9 billion.
Advocates see this as another incredibly good investment.
Helping infants and small children get

14. adequate nutrition will pay enormous dividends throughout
those children's lives.
Reductions may not exceed $0.3 billion.
Child care assistance
Proposed: $2.1 billion.
Without adequate child care, single parents face a di�cult
choice: remain unemployed, or leave children
unsupervised, sometimes in dangerous neighborhoods. Adequate
child care can also make it possible
for parents to continue their education, making it less likely that
they will need government assistance in
the future. Finally, high quality child care may greatly bene�t
children, making it more likely that they will
grow up to be productive adults.
Reductions may not exceed $0.1 billion.
Unemployment insurance
Proposed: $38.4 billion.
Although the economy is improving, many Americans still
struggle to �nd work. Thousands of workers
are nearing the end of their unemployment bene�ts, with an
uncertain future if bene�ts end and they
still cannot �nd a job. They and their families face the prospect
of losing their homes and other
hardships, leading some to call for an extension of
unemployment bene�ts-which would require
increased funding.
Reductions may not exceed $2 billion.
Temporary Assistance for Needy Families (TANF), and Related
Programs
Proposed: $17.9 billion.
This is the federal government's primary assistance program for
the poor, with recipients limited to two
years of consecutive bene�ts, and a �ve-year lifetime bene�t

15. limit. The proposed spending cuts total
TANF spending by about half a billion dollars over last year.
TANF bene�ts are very modest, and most
recipients seem to be able to move o� of assistance in two
years or less, but a small percentage seemed
to be plagued by other challenges-e.g. children with special
needs-which make it extremely di�cult for
them to get a job. These families face a loss of bene�ts without
a change in the law and an increase in
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funding.
Reductions may not exceed $0.5 billion.
Area 11: Law Enforcement
There are two categories in law enforcement and both have an
impact at the federal, state and local levels of
government. How do increases or decreases in this budget area
a�ect your home state? Do you see a value,
real or perceived to your constituents?
Criminal investigations (e.g., Drug Enforcement Agency, FBI,
Dept. of Homeland Security)
Proposed: $6.4 billion.
Many argue that more money is needed to �ght terrorist threats.
Furthermore, growing numbers of
analysts are critical of the FBI and argue that it needs to be
reorganized. However, e�ective
reorganization is costly. Currently, the FBI has responded to
terrorist threats by moving agents out of

16. other areas, so things such as organized crime may not get as
much attention.
Reductions may not exceed $0.3 billion.
Border and transportation security directorate activities
Proposed: $7.5 billion.
The United States has a long, unguarded border with Canada; a
long, increasingly forti�ed border with
Mexico; and thousands of miles of coastline. Security o�cials
are concerned about the ability of
terrorists to slip across border crossing stations (many of which
are unsta�ed late at night) along the
Canadian border. Agents post "Closed" signs when the crossing
are unsta�ed, but terrorists may not
follow the rules. Cameras can record some illegal entries, but
the illegal entrants are not always found.
O�cials in northern border states feel that much more coverage
is needed.
Reductions may not exceed $0.5 billion.
Area 12: General Government
There are two main categories in this area. Remember your role
as a public o�cial when you are considering
these categories. Should your party a�liations be considered
when adjusting this budget item? What impact
do the choices you've made, have on your decisions in this area?
Tax administration
Proposed: $10.1 billion.
Many people do not like the IRS, and would not be sad to learn
that they are understa�ed. However,
there may be hundreds of billions of dollars in tax avoidance
that is being missed because the IRS does
not have the personnel to pursue tax cheaters. Spending limits
here may be costing us money.
Reductions cannot exceed $0.5 billion.

17. Congressional compensation
Proposed: $0.1 billion.
Many feel that members of Congress are overpaid, but they are
responsible for a $2 trillion dollar
government-far larger than any corporation in the world, while
they are paid far less than any CEO of a
major corporation. Reductions here would require changes in
laws, but could be done.
Reductions may not exceed $0.02 billion.
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