Staff Working Paper
With the retirement of the baby boom generation drawing closer, concerns about the sustainability of current policies have become critical elements of the budget process. The seriousness of this problem should prompt us to reexamine the concepts and goals underpinning the budget process and find ways to focus budget decision-makers on the long-term implications of our current policy paths. This paper reviews some of these challenges and recommends ways they might be addressed.
Are the rules of thumb and categories we have explicitly and implicitly established in our budget process for resource allocation appropriate and aligned with our overarching fiscal, programmatic, and political goals? Do they establish the right incentives? Or do they create distortions? This paper looks at the bias in favor of mandatory over discretionary spending, tax expenditures, and capital budgeting.
This paper reviews the classes of information included in the budget resolution. It then examines potential changes to the contents in an attempt to focus deliberations and debate on core budgetary and fiscal questions. This paper also includes a discussion of current practice and budget principles. A more detailed discussion of fiscal information is included in a separate paper.
This paper lays out a model for converting the concurrent budget resolution into a joint resolution. It includes a description of the model and a discussion of its key advantages and disadvantages. Particular attention is devoted to how it would impact budget enforcement, both in terms of how budget limits would be enforced and the processes used to implement, comply with, or modify the limits.
The budget resolution should prompt debate about the implications of budgetary choices and aggregate totals for fiscal and economic policy, both near- and longer-term. This memo discusses options for increasing this focus through the development of better metrics, assessments of the macroeconomic implications of various budget plans, and the possible adoption of fiscal goals and targets. It also suggests ways to improve the budget process.
How could the current budgetary decision-making process be improved? This paper looks at the current process and how the concurrent budget resolution, authorization process, and appropriations process interact to establish a budgetary framework, allocate resources among competing priorities, and generate sufficient revenue. It also examines five reform proposals.
This paper looks at the 1967 President’s Commission on Budget Concepts and which concepts need to be re-visited by the Peterson-Pew Commission on Budget Reform.