The US Budget is one of the most talked about and least understood parts of how the American government functions. And it’s no surprise; budgeting is difficult and complex. Imagine your own personal budgeting process and multiply it times 300 million. The number of actors needed for that can’t just be one person, which means the sole power doesn’t directly go to the President.
The Constitution actually ascribes the vague “power of the purse” to Congress. In other words, Congress has the ability to collect taxes, to create taxes and to borrow money. However, as the founders found in many cases, the details of that process remain unclear. Consequently, the process has evolved with our government.Now, there are a series of federal agencies whose sole purposes are to create the budget. They include the Office of Management and Budget (OMB), the Government Accountability Office (GOA) and the Congressional Budget Office (CBO).
Every year, Congress goes through the appropriation process and passes a series of appropriation and authorization bills. Appropriation bills state how much money is allocated to a particular department. Authorization bills actually give the government permission to spend that money.
The Five Steps in the Federal Budget Process
If the budget is not complete by October 1 and it rarely is, then Congress must pass Continuing Resolutions so that federal agencies can still receive funding while negotiations are ongoing. You might remember 2013 where the government shut down. Those were situations when an agreement was not reached and funding was shut off to federal agencies. In fact, Congress has only passed all twelve regular appropriation bills four times between 1977-2012. If Congress can’t decide on twelve separate appropriations bills, they can also pass an omnibus bill - one bill that encompasses twelve funding areas.
Here at Sub-Stances, we’re going to be diving into what makes up the budget, how the funds are redistributed and providing some transparency to the budget process itself. The budget is an important process and one that many Americans only have a surface understanding of. Over the next few months, we’ll be breaking down each segment of the budget and bringing everything into layman’s language. Look forward to deep dives on defense, energy, social security and many more!
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