Budget Process Badly Needs an Upgrade

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A new joint congressional committee on the budget process held its first meeting Thursday amid bipartisan hopes that the panel would be able to suggest helpful reforms late this year.

Certainly there is room for improvement. Year after year the budget process has broken down, with Congress failing to make final spending decisions for each fiscal year until well after that year has started.

To avoid government shutdowns, Congress passes one or more stop-gap measures that generally continue federal spending at previous levels, regardless of changing circumstances and shifting national priorities. Falling back on these “continuing resolutions” fosters government inefficiency and costs taxpayers money.

In addition, Congress needs to focus more on making structural repairs in the federal budget that would lower deficits, put the entitlement programs on sustainable tracks and make appropriate investments to support strong, long-term economic growth.

The Concord Coalition has supported some proposed reforms in the budget process, notably the idea of a two-year budget cycle in which Congress would spend the second year focusing on oversight and long-term planning. Creating long-term fiscal targets and mechanisms to enforce them could be helpful as well.

Concord, however, has also frequently warned that procedural changes alone cannot force elected officials to make difficult fiscal decisions that they are determined to avoid. As Concord Coalition Executive Director Robert L. Bixby has said in testimony on Capitol Hill:

“Budget process reform is not a substitute for a serious plan to address the significant fiscal challenges facing the nation. However, common-sense reforms to the budget process can turn lawmakers’ attention to the kinds of long-term planning and strategic discussion that may yield true fiscal reform.”

The current fiscal year offers a perfect example of the problems with the budget process we have now.

Congress should have completed its work on spending legislation for Fiscal 2018 last summer and in early fall. Lawmakers failed to do so and then passed a series of stop-gap measures — five so far.

The last one, passed in early February, unfortunately laid the groundwork for a considerable amount of new deficit-financed spending and tax-break extensions.

Yet after all these stop-gap measures and nearly halfway through Fiscal 2018, lawmakers are still struggling to wrap up their spending legislation for the year by their latest self-imposed deadline: March 23. Meanwhile, the 2019 budget cycle is already getting underway.

Given the pattern in past years and the current situation, it is odd that the budget process proposal that seemed to draw the most attention as the new committee met last week was to shift from a fiscal year starting Oct. 1 to the calendar year.

The main argument for this proposed change: Lawmakers would supposedly finish their spending bills on time so they could get home in December for the holiday season.

If approaching holidays could guarantee congressional action on spending legislation, however, why didn’t that work last December? Congress faced two deadlines that month for completing its spending legislation. But lawmakers simply passed another short-term measure that moved the deadline to Jan. 19.

Congress has repeatedly started fiscal years with continuing resolutions. They could do that in the future regardless of whether the budget year starts on Oct. 1 or Jan. 1.

A second reason that has been given for shifting the budget process from the fiscal year to the calendar year is that it would give lawmakers more time to get the necessary spending legislation enacted on time.

But lack of time isn’t the real problem. Lawmakers have plenty of time to pass spending bills under the current schedule.

The problem — again, clearly illustrated by the current situation with this year’s spending legislation — is that lawmakers repeatedly procrastinate, assuming that necessary compromises will only be made at the last minute.

Shifting the fiscal year would amount to simply tinkering around the edges.

The new committee should aim higher, taking a close look at more substantial changes that could get the budget process working and enable lawmakers to focus more on the nation’s biggest fiscal challenges.

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