When Congress grants money...

[Free4Life11]

...where does the money come from? I'm an accounting student so I an geniunely interested in knowing. They passed a bill (or I dunno, an approrpriation?) for $10.5 billion. So does that mean that the next day the Treasury cuts a check for $10.5 billion and sends it to FEMA? What happens if there wasn't $10.5 billion left in the treasury?? Like is there a way to log on to a website and see how much "cash on hand" the government has? ((On a complete side note, I wonder if the accounting equation applies to the government??))

I mean they've got no problem spending money they don't have (maybe the GOVERNMENT needs to read the Total Money Makeover thread on Budget Board ), but I really don't know how it works.

How it works probably doesn't even matter because if the government wants to spend money, they probably do.

I've still never figured out who we are in "debt" too. That one baffles my mind to this day. But that's neither here nor ther, so I'll have to do some research on my own!

All of this stuff interests me so much and I guess I'll learn it but I just love to know how it works!

 

[Lisa loves Pooh]

social security?

The printing press?

(sorry, I couldn't resist)

 

[gina2000]

If there is no money in the treasury (which happens more times than you can imagine), the US Treasury issues a cash management treasury bill. It's short term - usually under one month and is especially used when the Federal Government cannot get a budget passed. When it matures the treasury will up their offering of longer term securities or rely on maturing securities to fund their deficit.

 

[gina2000]

Oh, and as far as debt is concerned, when you issue securities to pay for stuff, you are creating debt. Very often, the US Security market issuance is bought by US investors so in essense, we are in debt to ourselves.

 

[Free4Life11]

Thanks for the info gina. Very specific and good terms, I love all the little details.

Maybe I shoudl get a job as an accountant for the government. Might make my head spin though....

 

[Charade]

Bill Gates?