HOW TO GET BETTER AT BUDGETS.

AuthorRugy, Veronique De

YOU DON'T HAVE to be an avid consumer of news about the federal government to know that Uncle Sam's annual budgeting process is a mess. The budget is rarely completed on time, and it always seems to get bogged down with partisan bickering and political scheming. The process is often interrupted or transformed into an emergency by fiscal cliffs and government shutdowns, and it faces numerous chronic problems as well, from dead-on-arrival White House budget plans to perpetually ignored statutory deadlines.

When the dust finally settles, the result is usually a bloated agglomeration of goodies for special interests that most likely had a better grasp of the budget's contents than the elected representatives who voted on it (probably without ever reading it). Of course, almost every budget is bigger than its predecessor.

If the budgeting process is broken, it's apparently been broken for a long time. Since the enactment of the Budget Control Act of 1974, which dictates the current rules and was meant to make Congress more accountable, legislators have passed all 12 of the required discretionary spending appropriations bills on time on just four occasions. Instead of an orderly process, we tend to end up with omnibus spending legislation that wraps everything into one giant spending bill or short-term "continuing resolutions" that punt on hard choices.

Various "fixes" have been proposed to right the budget process. One recurring idea is that we should replace an annual budget with a biennial budget, covering two fiscal years. Supporters argue that a longer budget period would give legislators more time to conduct oversight of federal programs and, thus, more time to weigh competing spending desires. With more time, spending would supposedly be better targeted toward those programs that "work," while those that "don't work" would either be "fixed" or see their funding cut thanks to better oversight.

This is wishful thinking. In the 19 states that currently have such a process in place, the opposite is true. Biennial-budget states actually spend more money, while oversight remains flat. And congressional oversight is overrated. Oversight hearings are often just political dog-and-pony shows of little or no consequence. In many cases the whole point is for politicians to make statements that can then be used during political campaigns. These events are designed to benefit lawmakers, not the public.

The same can be said about budget-process reform, argues Stan Collender, a budget expert who teaches at the McCourt School of Public Policy at Georgetown University. His take is that the process actually works exactly as legislators want it to work. Indeed, for all the complaints that the budget process receives from those in charge, it enables politicians to do what they want to do (cater to interest groups) while avoiding what they don't want to do (live within their means).

The growth of mandatory spending exacerbates the problem. Outlays on Social Security, Medicare, and Medicaid, as well as interest payments on the debt, aren't appropriated each year in the manner of discretionary programs covering education, transportation, and the like. As a result, those programs can't be used to distribute favors (though promising not to reduce spending on them often indirectly serves that function). As the number of people benefiting from the entitlement system grows and the eligibility rules are relaxed, a bigger and bigger share of spending has to be directed toward it. Today, 70 percent of the budget is spent on such programs, compared to 40 percent in 1970. Politicians therefore have less money to fling around on new spending meant to curry voter favor.

It's true that some members of both houses talk about reforming the budget process to make it more rigorous and fiscally responsible. They have even formed House and Senate budget committees and held hearings on the issue. However, Collender believes that "this activity is less designed to retool...

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