The Congressional Budget Process.pdf

The framers of the Constitution deliberately lodged the power of the purse in Congress because it is the branch of government closest to the people. This power is considered the most complete and effectual weapon for obtaining a redress of every grievance and carrying into effect every just and salutary measure. Under Article I of the Constitution, only Congress is empowered to collect taxes, borrow money, and authorize expenditures. The executive branch can spend money only for the purposes and in the amounts specified by Congress.

The Constitution did not prescribe a budget system for the legislative branch. Instead, the budget system evolved over time to reflect new demands and pressures. In the U.S. system of separate institutions sharing power, the president exercises significant fiscal authority through a wide-ranging ability to influence the lawmaking process, the constitutional veto power, and the authority to execute the law. Congress delegated to the president in the Budget and Accounting Act of 1921 statutory responsibility for preparing a comprehensive federal budget each year.

About two-thirds of federal expenditures are mandatory under existing law, including largely entitlements and interest payments on the federal debt. Mandatory spending includes programs such as Social Security, Medicare, and government pension programs. If the 116th Congress adjourned immediately after convening, federal government spending for 2019 would still be almost $2.7 trillion. Congress can convert mandatory spending into annual appropriations by changing the basic law that establishes governmental obligations and authorizes automatic funding without regular legislative review.

The federal budget reflects the president's and Congress's choices among competing national priorities and identifies where the nation has been, where it is now, and where the administration and legislative branch plan to make future fiscal as well as policy commitments. The budget is both a fiscal and a political document, and debates on the budget tend to be more partisan than other debates. The two parties have a wide gap between them on how to reduce the fiscal deficit and grow the economy.

In broad terms, federal budgeting is composed of four main phases: preparation and submission of the budget by the president to Congress, congressional review of the president's budget and action on required budgetary matters, execution of budget-related laws by federal departments and agencies, and review and audit of agency spending. The congressional budget process may be summarized as having three key features: it is a collection of separate decisions on legislation that affect federal spending, revenues, and borrowing, it includes special measures and procedures to facilitate the coordination of these decisions, and it places restrictions on the consideration of spending and revenue legislation in terms of their projected budgetary effects.