The Politics of the Budgetary Process

The Politics of the Budgetary Process

The politics of the budgetary process involves far more than the structural dimension of policymaking; it also includes the relationship between the political players. This research examines the interaction of some of these major players in the budgetary process and the impact of this interaction on the final budget.

The Congressional Budget and Impoundment Control Act of 1974 (hereafter the Budget Act) has markedly changed the process of legislation relating to the federal budget and tax policy, especially since 1980 (Fisher, 1975, pp. 26-35). We need not be concerned with the details of the Budget Act; the important point is that a reconciliation resolution passed by Congress specifies the amount by which revenues and/or spending is to be changed in order to meet budgetary targets. This has had the effect of centralizing power in the budget committees and weakening the tax writing committees.

After a tentative start, the Budget Act came to exert an important influence on budgetary politics. In 1980, for the first time, instructions to the tax writing committees mandated a one-year increase of revenues (of $4 billion)–a mandate that was carried out. The Budget Act contributes to fiscally responsible policy, because the budget resolution indicates to the revenue committees the amount of money that must be raised through tax policy for the next three fiscal years. By setting a particular revenue target, the resolution sets the stage for discussions of trade-offs involving alternative ways to raise that amount. The tax expenditure budget helps in the evaluation of these trade-offs, by quantifying the revenue effects of various preferences, as well as by publicizing the use of this avenue of supporting private activities.

The Gramm-Rudman-Hollings Act is also intended to impose discipline on an otherwise undisciplined Congress (and President). In principle, expenditures cannot be legislated without regard for their budget…

Leave a Reply

Your email address will not be published. Required fields are marked *