WASHINGTON — The Concord Coalition today released an
updated version of its “Ten
Criteria for Judging How Budget Plans Measure Up,” first published in
1997. The criteria were updated in recognition of the fact that Congress
is once more confronted with the need to craft a long-term balanced budget plan.
Following is an executive summary of the criteria.
WASHINGTON — The Concord Coalition today released an
updated version of its “Ten
Criteria for Judging How Budget Plans Measure Up,” first published in
1997. The criteria were updated in recognition of the fact that Congress
is once more confronted with the need to craft a long-term balanced budget plan.
Following is an executive summary of the criteria.
-
Are the estimates of future deficits and proposed policy
changes realistic? Estimates of current law deficits in the years ahead and
savings achievable through proposed policies should not be overly optimistic.
Aiming at an overly optimistic target decreases the likelihood that the plan
will actually result in a balanced budget. -
Does the deficit path trend steadily and smoothly
downward so that each year’s planned deficit is smaller than in the preceding
year until a zero deficit is reached? A budget plan that begins by
increasing the deficit in the first year or two should be viewed with great
suspicion. Actual results are most likely to match a budget plan in the first
year or two; after that they are subject to economic and political developments
that are difficult to predict. -
Are major tax cuts and spending increases postponed
until a balanced budget has been achieved? Large tax cuts or massive
expansions of federal programs increase the deficit and have no place in a plan
to bring the budget into balance. -
Are new or expanded entitlements avoided, or if
included, are they held to a minimum and is their cost fully offset? New
entitlements create their own demand and generally end up costing more than
predicted. A budget plan that proposes such new or expanded entitlements must
pay for them fully by offsetting tax increases or reductions in other
entitlements. -
Are proposals to cut discretionary spending explicit and
plausible? Recent experience has shown that Congress can limit discretionary
appropriations only with extraordinary difficulty. A budget pl should not rest
on the assumption that a future Congress and a future President will somehow
defy previous experience by enacting heroic domestic spending cuts. -
Do the numbers add up without resort to "triggers,"
score-keeping gimmicks, or "time bombs?" Budget tricks should be avoided.
Clever accounting does not fool the economy. -
Does the plan keep the budget in balance in the decades
after the baby boom generation ages and entitlement costs explode? A budget
that ignores the huge impending fiscal impact of the boomers retirement might
eliminate the deficit in the short-term but it will not prove sustainable in the
face of the enormous projected fiscal cost of the coming senior boom. -
Does the plan distribute short-term sacrifice fairly and
equitably among Americans of all ages and income groups, expecting the wealthy
to do their fair share, and exempting only the very poor? The fruits of a
balanced budget will be enjoyed by all. Thus, no economic group, except for the
very needy, should be exempt from contributing to eliminating the federal budget
deficit, and those who can more readily shoulder the burden should be asked to
do so. -
Can the plan attract substantial bipartisan support?
Starkly partisan budget proposals may appeal to true believers and party
loyalists, but they are not likely to be enacted and even less likely to be
enforced. -
Does the plan contain credible enforcement mechanisms?
Congress will need a set of rules to help enforce any plan it may adopt to
rebalance the budget. There are too many claims on too few dollars to declare
that formal budgetary restraints are no longer necessary.
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