Articles from April 2009
April 22, 2009
Budgeting: The Great American Process
As ‘budgeting season’ descends upon the Oklahoma State Capitol, let’s step back and evaluate the budgeting process in American politics. Pay particular attention to the in-fighting associated with the modern budgeting process.
Budgetary politics is the foundation of contemporary American governance with vested interest in the funding of discretionary as well entitlement programs that the populace relies upon. Although it has been through various stages of policy development and enactment, budgetary politics and the response by the citizenry in America has always been directly related to the political events in which the U.S. is involved.
There have been many attempts to restructure and reform the process of budgeting in American politics. Throughout our nation’s history there have only been a handful of budgeting policies that have seemingly reflected the domestic/public opinion, the political makeup of the legislature versus the executive and the events that America is linked to at the time. Power-shifting has defined the struggle to create comprehensive budgetary policy; from the Congress to the executive branch, to the newly adapted Obama strategy that involves the grassroots level of citizen-lobbying efforts to push stimulus plans through. The role that policy and the process play in budgeting continuously shifts depending on the political ‘place’ in which America finds itself.
Throughout this era in budgeting, the U.S. has seen many political maladies that have led to the attempted reformation of the process. The “Stalemate era” is characterized by the political factions that play budgeting as a game of Tit –for – Tat taxation and non-taxation; once the democrats began insisting (post 9/11) on passing legislation that assisted the unemployed, including health insurance. This idea was matched by the Republican plan to give tax credits to those who could not find employment (although welfare is certainly not a Republican-supported doctrine).
There have been many factors that have led to this stalled era in American budgeting; the rise of the “two Americas” and divided party governance. The executive branch has dominated by the Republican Party during the majority of the “Stalemate era” and has cultivated a brand of fiscal policy that is driven predominately by cronyism. There was also a large shift (since the mid-1960s) in who benefits from the budget and from where the money is raised to fund programs. There has been an increase in funding to entitlement programs and individuals in the form of social welfare which comes at the expense of another program. The real issue is not balancing the budget but budgeting the nation’s wealth; how and what to spend produces political infighting that is associated with contemporary budget agreements.
The budgeting process that the U.S. adheres to now is a culmination of economic forecasting and “new public management” ideals. There are limits to discretionary spending programs; this is accomplished by dividing discretionary spending into three categories: military/defense, international and domestic programs. This breakdown helps determine where and how much of the budget is going toward mandatory government programs. The “pay-as-you-go” mentality became common practice in the late 1980s through the 2001 period for mandatory spending programs; post-September 11, 2001 “pay-as-you-go” fell to the wayside.
Economic forecasting has become an essential tenant in the process of budgeting over the last three decades; when policy makers attempt to weigh all national and U.S. interests abroad while deciding what programs to fund and which to cut. Budget leaders, appropriation/finance committee chairs along with the executive branch began to consider economic instability (high unemployment, recessions, the global economy, disasters). Anticipating the nation’s debt and its expenditures before a fiscal year has become far more important to decision-makers struggling to gain control over the budget.
Budgetary politics is the foundation of contemporary American governance with vested interest in the funding of discretionary as well entitlement programs that the populace relies upon. Although it has been through various stages of policy development and enactment, budgetary politics and the response by the citizenry in America has always been directly related to the political events in which the U.S. is involved.
There have been many attempts to restructure and reform the process of budgeting in American politics. Throughout our nation’s history there have only been a handful of budgeting policies that have seemingly reflected the domestic/public opinion, the political makeup of the legislature versus the executive and the events that America is linked to at the time. Power-shifting has defined the struggle to create comprehensive budgetary policy; from the Congress to the executive branch, to the newly adapted Obama strategy that involves the grassroots level of citizen-lobbying efforts to push stimulus plans through. The role that policy and the process play in budgeting continuously shifts depending on the political ‘place’ in which America finds itself.
Throughout this era in budgeting, the U.S. has seen many political maladies that have led to the attempted reformation of the process. The “Stalemate era” is characterized by the political factions that play budgeting as a game of Tit –for – Tat taxation and non-taxation; once the democrats began insisting (post 9/11) on passing legislation that assisted the unemployed, including health insurance. This idea was matched by the Republican plan to give tax credits to those who could not find employment (although welfare is certainly not a Republican-supported doctrine).
There have been many factors that have led to this stalled era in American budgeting; the rise of the “two Americas” and divided party governance. The executive branch has dominated by the Republican Party during the majority of the “Stalemate era” and has cultivated a brand of fiscal policy that is driven predominately by cronyism. There was also a large shift (since the mid-1960s) in who benefits from the budget and from where the money is raised to fund programs. There has been an increase in funding to entitlement programs and individuals in the form of social welfare which comes at the expense of another program. The real issue is not balancing the budget but budgeting the nation’s wealth; how and what to spend produces political infighting that is associated with contemporary budget agreements.
The budgeting process that the U.S. adheres to now is a culmination of economic forecasting and “new public management” ideals. There are limits to discretionary spending programs; this is accomplished by dividing discretionary spending into three categories: military/defense, international and domestic programs. This breakdown helps determine where and how much of the budget is going toward mandatory government programs. The “pay-as-you-go” mentality became common practice in the late 1980s through the 2001 period for mandatory spending programs; post-September 11, 2001 “pay-as-you-go” fell to the wayside.
Economic forecasting has become an essential tenant in the process of budgeting over the last three decades; when policy makers attempt to weigh all national and U.S. interests abroad while deciding what programs to fund and which to cut. Budget leaders, appropriation/finance committee chairs along with the executive branch began to consider economic instability (high unemployment, recessions, the global economy, disasters). Anticipating the nation’s debt and its expenditures before a fiscal year has become far more important to decision-makers struggling to gain control over the budget.