Distinguish fiscal from monetary policy and analyze taxing/spending choices and deficits.
The Fed moves interest rates; Congress and the President move taxes and spending — that's fiscal policy. Government buys real things (roads, carriers, teachers' time) and transfers money (Social Security, unemployment insurance), funded by taxes — or, when spending exceeds revenue, by borrowing. The yearly gap is the deficit; the accumulated pile of gaps is the national debt.
Fiscal policy can lean against the economic wind: in recessions, spend more and tax less to prop up demand (stimulus checks, infrastructure); in booms, ease off. Progressive taxation takes a larger share from higher incomes; every tax design is a trade-off between revenue, fairness arguments, and the incentives it bends (tax something, you get less of it). Deficits aren't automatically evil — borrowing to build a bridge can pay for itself — but debt service crowds the future budget, and the interest is real money not spent on anything else.
Mastery looks like: They can classify policies fiscal-vs-monetary and argue a deficit's case-by-case merits with mechanisms.
Common stumbles: Merging the Fed and Congress into one "government"; treating debt as identical to a household credit card.