Congress Limps Out of Town with a Fractured Budget Process
Patrick Louis Knudsen /
Happily, the world did not end on December 21, as some interpreters of the Mayan Long-Count Calendar predicted. Earth did not get sucked into the black hole at the center of the galaxy; it did not crash into the planet Nibiru; its core did not heat up, causing earthquakes and tsunamis and other nasty things as in the schlocky sci-fi film a few years back.
No devastating collapse hit Washington either, despite ominous warnings about partisanship and polarization. Agencies kept running, Social Security checks got mailed, the government didn’t default on its debts. Still, as 2012 draws to a close, the departing 112th Congress has left a nagging sense of unease about the condition of Washington policymaking. The erosion of governing goes on.
Nowhere is this more evident than in the state of the budget. The federal government will likely produce its fifth straight trillion-dollar-plus deficit in fiscal year 2013. Publicly held debt exceeds three-fourths of the economy’s total resources, and is on course to be double the size of the entire economy in 25 years.
Driving the problem is federal spending, which reached nearly $3.6 trillion in 2012, close to one fourth of all the nation’s economic resources. Adjusted for inflation, spending is more than three times its peak level in World War II. The three largest entitlements—Medicare, Medicaid, and Social Security—and interest on the debt will surge to 18.5 percent of GDP by 2025, swallowing up all the historical average of federal tax revenue. Here too, the crisis might not arrive in a sudden, cinematic cataclysm. More likely federal spending will continue to gradually drain the nation’s resources, leaving a chronically anemic economy.
As this crisis accelerates, Congress has all but lost its ability to budget. Lawmakers have not passed a complete budget for nearly three years and eight months (although the House has passed budget resolutions each of the past two years). The result has been a string of spend-as-you-go measures with no coherent fiscal strategy, uncertain tax policies, and ad hoc mechanisms that fail to bring the order and discipline they promise. It was these irregular procedures, as well as lawmakers and the President pushing decisions off until after the election that led to the “fiscal cliff.”
The breakdown in congressional budgeting has also exacerbated a failure in governing itself, emasculating Congress as the policymaking branch of the government and allowing power to concentrate in the administrative state.
Luckily, recovery is entirely within Congress’s grasp; it is simply a matter of choosing to govern. That should start with a commitment to regular budget procedures in the 113th Congress. Lawmakers like to complain that the budget process is broken, but it is they who broke it—deliberately.
The divided state of the 113th Congress will make budgeting more difficult, but the government’s fiscal challenges will not resolve themselves; lawmakers must act. The congressional budget process is far from perfect—but it can be made to work if Congress wants it to.