The Five Steps Of The Federal Budget Process

But having a budget is a good step in the right direction. Continuous reexamination is necessary to keep the budget on track. A potential reform for the federal budget is the switch from a short-term budget perspective to a long-term perspective (Budget & Projections, 2015, p. 1). This switch can be beneficial for several reasons. The main beneficial reason is having a greater outlook. Having a greater outlook on future budgetary effects can help policymakers make better-informed decisions in regards to the federal budget. Another potential reform for the budget is to commit and concentrate on spending control. In order to reduce the debt, spending must be under control. A good policy must be in place to ensure the control on spending is a continuous effort by the

Overspending is a pertinent problem facing the lawmakers in Congress. In 2012 discretionary spending reached $1.3 trillion and mandatory spending $2 trillion, while only bringing in $2.5 trillion in revenue. Since the turn of the century back in 2000, non-mandatory spending by the government has topped out a whopping $16.1 trillion just in the past 13 years (Boccia, Frasser & Goff 2013). This persistent overspending on programs and services that are not necessary to the functionality of the country is what is causing the deficit to rise year after year. To remedy this issue the government must either increase the revenue it brings in through taxes and trade or reduce the amount of money it spend or perhaps even both. In 2012 thirty-one cents of every dollar that Washington spent was borrowed (Boccia, Frasser & Goff 2013). Most of which went to large programs such as Social Security and Medicare and if these large, growing programs, or just the budget in general, do not undergo financial reform it could spell disaster for the economy and fiscal state of the nation.

The budget process is a powerful planning tool for government to make important resource decisions. According the Carney and Schoenfeld‘s article on How to read a Budget, an operating budget is a reflection of government’s financial plans. When a budget is

Budgeting is perhaps the most essential process involved in the United States government. While this process seems to exist only in the background, it is, in reality, what allows all other processes of government to function as they do. In order to satisfy the most necessities of modern society, changes must be made to each of the three major categories of the budget: the big five, the middle five, and the little guys.

In response to a rapidly increasing national debt, President Barack Obama signed into law in August of 2011 the Budget Control Act (BCA) which mandated $1.2 trillion in across-the-board spending cuts, known as sequestration, over a 10-year period (Matthews, 2013). The BCA of 2011 was intended to serve as motivation for the Joint Select Committee on Deficit Reduction to come up with a deal for achieving equivalent spending cuts and avoid a mandatory sequestration (Matthews, 2013). The committee

“To budget is to fight over money and the things money buys” (Document A). The federal budget is adjusted every year and has to follow certain criteria set forward by the Preamble to the Constitution. The Preamble sets five goals that the budget must fulfill, these goals are: to establish justice, to insure domestic tranquility, to provide for the common defence, to promote the general welfare, and to secure the Blessings of Liberty to ourselves and our prosperity. Furthermore, it is difficult to decide what clusters of the federal budget to allocate money to in order to meet the five goals of the Preamble which are “The Big Five”, “The Middle Five”, and “The Little Guys.” In each of the three budget clusters,

This establishes the total targets of five budget key areas: authority, outlays, revenues, surplus or deficit, and public debt. The resolution also sets a budget authority and outlay targets of each of the 21 spending categories. Finally, the committee prepares guidelines in the annual budget resolution for cutting programs to meet spending targets. A few other key responsibilities that the HBC may receive is to sometimes include reconciliation instructions that instruct committees to develop legislation that will change current revenue or direct spending laws to conform with policies established in the budget resolution, and to make summary budget scorekeeping reports in order to measure the budgetary effects of pending and enacted legislation against the levels recommended in the budget resolution.

The wars in Iraq and Afghanistan are winding down and that will help lower the defense spending by almost $1 trillion over the next decade. The congress is realizing that they need to do some restructuring and have already begun rearranging the military budget in response to austerity. Congress conjured up a $630 billion defense appropriations bill that made plans to reduce civilian and contractor personnel by 5 percent over the next five years and in return ramp up advanced weapons programs, including drones, bombers and missiles says The Washington Post. The American Conservative

Review all budgets that the president put in. According to United State Senate (2017), The Appropriation committee reviews budget requests from the president, solicits testimony from government officials, and drafts funding legislation that gets reported to the full Senate (Para

Congress completes action on the concurrent resolution on the budget. (This is not signed by the President).

The budget process is the most important aspect of fiscal decision making in Public Administration. Smith and Lynch (2004), argues that “Public budgeting is an activity that many people view from their own perspectives and, thus, they do not comprehend the full complexity of budgeting” (p. 34). Similar to the contextual definition of complexity in budgeting process, a classic example was the State of California’s budget impasse for the year 2010-2011. This essay examines and analyses the concerns that lead to passing a late budget in the State of California. It further goes into details regarding the reasons, resolutions, and consequences faced due to the budget Impasse.

The United States Constitution in Article 1, Section 8, Clause 1, designates the "power of the purse" as a function of Congress. It gives Congress the role of the negotiator of the use of public funds, and to make sure the federal budget reflects the values of a majority of Americans. It also includes the power to create and collect taxes and to borrow money when needed. Consequently, Congress creates a new budget every year. This annual congressional budget process is also called the appropriations process. The first step in the process is done by the President of the United States. He starts the federal budget process by sending a budget request to Congress each February for the coming fiscal year, which always begins on October 1st. The

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 first step to creating the federal government budget is the President submits a budget request to Congress. The executive branch gets requests from the federal agencies saying that different things and projects need money or that they don’t need money. So basically they discuss what project is more important. Yet these are all only proposals so they can either be accepted or denied depending on what the people think the country needs.

Historically, incrementalism has characterized public budgeting because at its core, budgeting has evolved: increased and decreased through gradual stages within the realm of the political arena. The need for this one step at a time type of response, found within incremental budgeting, would have likely been caused by the known fact that prior to the 1900’s public welfare programs, federal, states, and even city spending did not exist in the way in which is more than obviously observable in today’s society simply because America did not employ an actual budgetary system. Therefore, as with any unchartered territory, it was approached in stages, with caution, a little at a time in response to the growing needs of the public. Aaron Wildavsky made this case in his book “The politics of the budgetary process,” when he pointed out “budgeting is incremental, not comprehensive. The beginning of wisdom about an agency budget is that it is almost never actively reviewed as a whole every year in the sense of reconsidering the value of all existing programs as compared to all alternatives. Instead, it is based on last year’s budget with special attention given to a narrow range of increases or decreases.” (Wildavsky 1964, p. 15)