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Federal BudgetBudget deficits are back for as far as the eye can see. This alone is a very serious development. Of more concern, however, is that politicians in Washington are not even working on a plan to bring the deficit under control. Instead, they have indiscriminately cut taxes, increased spending, allowed budget enforcement rules to expire and ignored the long-term dangers of large chronic deficits. Reversing this trend will take the discipline imposed by a firm fiscal policy goal, and the rules to enforce it. These elements, which are now missing from budget debates in Washington, were crucial to the successful deficit reduction efforts of the 1990s. The Concord Coalition believes that a credible long-term budget plan is needed. Just beyond the ten-year budget horizon, America's age wave begins to roll in. If age-related entitlement programs such as Social Security and Medicare are left on autopilot, all projections -- by the Congressional Budget Office (CBO), the Government Accountability Office (GAO), and President's Office of Management and Budget (OMB) -- indicate that deficits will eventually rise to economy-shattering levels. The American public is beginning to understand that the status
quo is unsustainable. It's hard to imagine anything that would do more to boost
near-term economic confidence than a credible plan to address America's
long-term budget challenge.  Concord Coalition's Plausible BaselineThree times each year the Congressional Budget Office releases its budget projection for the next 10 years. This "baseline" makes a variety of assumptions about taxation, spending, and the economy. Some of these assumptions are reasonable and others are not because of the peculiarities of budget law. Our baseline compensates for the more unreasonable assumptions and presents a more plausible scenario. Recent CBO reports have included alternative estimates that we use in constructing our "plausible baseline". Like the official CBO baseline, it is not a prediction, but a projection of where current trends are leading. For more information on our baseline, click here. Federal BudgetEvery year the President of the United States submits a budget to Congress representing the Administration's priorities for the next year and beyond. Congress is not required to adopt the President's budget. Instead it formulates it's own budget called the Congressional Budget Resolution. Once approved by the House and Senate, it becomes the blueprint for spending and taxation legislation. To learn more about the federal budget or Concord Coalition's stance on the budget please check out the following links.
Federal Budget ProcessIn the past, Congress has repeatedly attempted to tinker with (or outright rewrite) their budgeting rules to encourage deficit reduction. Even the most successful attempts have been limited. When the will is not there, no matter what the rules, a way can be found to twist or avoid the limits they impose. This does not mean that the federal budget process is unimportant, it is quite important. The rules imposed by the process can help deficit hawks fight the low tax/high spending tendencies of other, less fiscally responsible, members. Recently the Concord Coalition held an event to discuss the budget process, as well as what needed to be changed. |
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Copyright 2005 |
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