THE FEDERAL BUDGET PROCESS

THE FEDERAL BUDGET PROCESS

This research examines the process involved in the enactment of the federal budget. Congressional and executive roles in the process are reviewed, as are the interactions and conflicts between the Congress and the President in the development of a national budget. Deficit reduction measures, such as the Gramm-Rudman-Hollings Bill, and the drive for a balanced budget amendment to the Constitution are also addressed.

The Constitution grants Congress preeminent fiscal power. Article I of the Constitution states that all bills designed to raise revenues must originate in the House of Representatives, and that no monies shall be disbursed from the treasury in the absence of an appropriation bill directing such action. Further, by tradition all appropriations bills also originate in the House of Representatives.

The language of the constitution in relation to the development of a national budget is relatively simple. The reality of the budgeting process, however, is quite complex. More than 70 years ago, the Budget and Accounting Act of 1921 “attempted to make the federal budget process more responsible and efficient.” The act directed that a federal budget be prepared by the executive branch and submitted by the President to the Congress, and that a budget office be established within the executive branch to coordinate the preparation of the budget. The act recognizes that the Congress will continue to make the final decisions on the federal budget. While the President can veto a budget bill as is true with respect to any other legislation, the Congress can override a presidential veto of a budget bill as is true with respect to any other presidential veto. The annual federal budget is now prepared in the President’s Office of Management and Budget. The budget is submitted to the Congress through the President’s annual budget message to that body.

One of the long-time difficulties in pass…

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