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ok so now were going to consider a fiscal policy three aspects of fiscal policy the one how the budget is formulated second how the debt is related to the deficit and third how the deficit itself depends on the state of the economy lets begin with the budget process there has been over the years kind of a regular order to the federal budget process in the United States and its that process where fiscal policy is actually made usually I have a proposal thats made by the president in late January of each year that budget proposal is based on economic assumptions prepared by economists looking in the White House parts of the executive branch because the budget itself depends on the state of the economy after that proposal the Congress deliberates decides what to do and they pass a budget if thats signed by the president its almost always different from the original proposal you can consider an example from the year 2011 when the fiscal year 2012 budget was proposed and heres a pict
