The Disappearing Budget Process
This week on Facing the Future, host Bob Bixby spoke with Molly Reynolds, Vice President and Director of Governance Studies at the Brookings Institution, about the deteriorating federal budget process. Their conversation explored why Congress just passed a budget resolution that is a year behind schedule, the expanding use of the fast-track budget reconciliation process to enact annual appropriations, and the broader implications of all this for American governance and fiscal policy.
Congress approved a budget resolution in April, which is what they were supposed to do under the Congressional Budget Act. Unfortunately, it was a Fiscal Year 2026 budget resolution (a year that began last October) rather than a Fiscal Year 2027 budget resolution, which is what they should have been working on. In other words, they were a year late with the FY26 budget resolution and have already missed the target date (April 15) for the FY2027 budget.
According to Reynolds, “the budget resolution that we’re talking about now… is really not performing the function of a budget resolution that the Congressional Budget Act anticipates. Rather, it is unlocking a special set of procedures known as ‘reconciliation’ that allow for certain budgetary legislation to move through the Senate without the threat of a filibuster.
Reynolds explained the political urgency behind this move: funding for two specific parts of the Department of Homeland Security (DHS)—Immigration and Customs Enforcement (ICE) and Customs and Border Patrol (CBP)—remained unresolved due to a lack of bipartisan support. “You can’t log-roll your way to funding ICE and CBP in the current political environment,” Reynolds said, highlighting how political divisions have left these agencies unfunded through the regular appropriations process where bills are subject to a filibuster in the Senate that requires 60 votes to overcome.
Traditionally, Congress funds discretionary spending—including agencies like ICE and CBP—through twelve separate appropriations bills passed annually. However, the reconciliation process is increasingly being used to bypass the usual legislative hurdles. Reynolds pointed out that while reconciliation was originally designed to help pass tough budget choices involving mandatory spending and revenue changes, its use has evolved. One such evolution is that Congress is increasingly using reconciliation to supplement traditional appropriations funding.
“This is not the first time that Congress has looked at activities [in reconciliation] that would historically have been funded through the discretionary appropriations process,” she said.“This happened in 2021 with the American Rescue Plan. It happened in 2022 with the Inflation Reduction Act. It happened last summer with the One Big Beautiful Bill Act. The thing that is different about what’s happening now is that this is the singular purpose of this bill. We are not seeing Congress do a reconciliation bill that also addresses revenue, and also addresses entitlement programs, and also addresses farm subsidies and all of the kinds of things that reconciliation has historically dealt with – and then added in some money that would have historically been discretionary as part of the process. That’s not what’s happening. They are doing a reconciliation bill explicitly for the purpose of solving a political problem, which is the inability to get bipartisan support for discretionary appropriations into particular parts of DHS.”
According to Reyiolds, this shift has important consequences. “I think it’s possible,” she said, “that we’re setting ourselves up for a future where, when the same party controls the House, the Senate, and the White House, there will be some things, probably most things, that are funded through the discretionary appropriations process that continue to move, through that process on a bipartisan basis. There will also potentially, however, be a set of things that are really important to the majority party, and that they can’t get done on a bipartisan basis in the appropriations context, that they’ll move to reconciliation and do things at a simple majority threshold.”
She added that diminishing congressional oversight could be another potential consequence of using reconciliation to fund agency budgets. “Various aspects of reconciliation make it difficult to write the same kinds of details about how money should be spent, coming out of the reconciliation process as it is in the discretionary appropriations context….So, basically, we’re seeing Congress be willing, in pursuit of a particular set of party policy goals, abdicate some of its authority in the direction of the agencies.
Reynolds also discussed an emerging executive power issue known as “pocket rescissions.” She explained that the President can propose canceling funds that Congress previously appropriated, but only if Congress approves those cancellations. This process includes a 45-day window for congressional action. However, the administration has started proposing rescissions very close to the end of the fiscal year, effectively letting the cancellation take effect without congressional approval as the 45-day window lapses.
“This is what we’ve started to call pocket rescissions,” Reynolds said, describing how this tactic manipulates timing to allow the executive branch to unilaterally withhold funds. The practice is currently under review in federal court and has raised concerns because it resembles a line-item veto, which the Supreme Court previously ruled unconstitutional.
On the thorny issue of addressing deficits and debt, Reynolds expressed skepticism about early action but acknowledged the potential for crisis-driven change: “Congress is like college freshmen everywhere. They don’t work well in the absence of a really firm and close deadline.” She advised that Congress prepare by investing in expert capacity and legislative resources, noting the political challenges of expanding congressional staff. Reynolds also addressed the idea of a fiscal commission, pointing out that such efforts succeed only when both parties agree on the problem and want to share responsibility for tough choices. As the interview concluded, Reynolds reminded listeners of the importance of paying attention to the budget process despite its complexity: “It all does matter. It has substantive consequences at the end of the day, and so it’s worth keeping track of.”
The overall discussion with Reynolds painted a picture of a congressional budget process in flux—where traditional norms and procedures are being upended by political polarization, strategic maneuvers in the Senate, and an assertive executive branch. This evolving landscape raises critical questions about the future of fiscal governance in the United States and the balance of power among its branches of government.
