Essay on The Federal Budget

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The Federal Budget

The federal budget is known as the infamous monetary tank from which money is distributed to various programs. Why does the federal budget plan cause such uproar of approval or disapproval when it is proposed by the President every February? The money utilized every fiscal year, which runs from October 1st of each year until the end of September of the following year, belongs to the people. The money is raised through income taxes, excise taxes (taxes on goods) and social insurance payroll taxes. Presently, the public is worried about how they will receive a fair share of money appropriations in such a slow economy. The federal deficit has returned, which means that the government’s spending
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No one decides on the total amount the federal government will spend. Instead, legislative bills that determine the total amount of spending are divided up among fifteen separate committees in the Senate and seventeen committees in the House of Representatives. The Appropriations Committee has jurisdiction over non-entitlement programs (spending varies year to year based upon spending authorized by Congress), which covers one-third of total federal spending. The remaining two-thirds is made up of entitlement programs (spending authorized by permanent laws), which are handled by other standing committees. The agricultural committees have authority over farm price supports, food stamps, and other rural programs. The tax-writing committees in the House and Senate are responsible for Social Security and Medicare. The House Energy and Commerce Committee has jurisdiction over Medicaid.

The decentralization of spending authority creates deficit financing. By spreading the spending responsibility among so many committees, Congress has created a commons problems. Numerous claimants are competing for a commonly owned resource. The forces of competition for the resource are leading to over consumption and exhaustion of the resource. From the individual committee perspective the commonly owned resource is federal revenues. The consumers of the resource are the congressional committees. The common resource is over consumed

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