Capitolworks: Just the Facts...The President’s Budget, Again.

March 22, 2019

With the President’s 2020 budget released just last week, we thought a brief review of the budgetary process and what the President's budget means seems in order. Mr. Trump's $4.7 trillion budget blueprint, the largest in U.S. history, includes calls for $8.6 billion in new funding for a border wall, increased funding for the military and Homeland Security, funding for HIV research as well as the elimination of funding for the National Endowment for the Arts- just to name a few. Ironically, for all of the attention that a President's budget receives, it is not the budget that actually funds our government and in fact, is not at all binding on Congressional budgetary action. So if this statement is true, why would the President go through this challenging process every year?  Let’s walk through the answer to that question together.

 

To begin, the Budget and Accounting Act of 1921 requires the President to submit a budget to Congress for each fiscal year. Additionally, the budget request must be sent to Congress between the first Monday in January and the first Monday in February. However, there are years when this deadline is missed due to various factors including a new President taking office or like this year, as a result of the partial government shutdown.

 

Crafting the President's budget can take more than a year of planning, number crunching and negotiating. Each of the President's agencies must decide which programs they want to fund, what programs will lose funding or be cut and perhaps, what new programs might be created. There is much more to this process but needless to say, it is quite complex and time-consuming for all those involved. And yet, in the end, this budget serves merely as a blueprint or a "wish list" of what the Administration would do if it were in charge of the federal budget. But, they aren't. So, who is you might ask? Congress.

 

Congress holds the “power of the purse" when it comes to creating our federal government's budget. This budget is the culmination of 12 separate appropriation committees, working to pass a spending bill that will fund the agencies that they have jurisdiction over by October 1, the start of the new fiscal year. This process requires each committee to take into consideration, the limit of federal spending as determined by the congressional budget committee each year, the previous year's budget for each agency and their programs; the priorities of the members of Congress as well as the President's request. Then, through some very complicated equation, each committee must pass a budget bill. Skipping ahead a bit, this process must take place in each chamber; each budget bill must be reconciled or, the same, in both the House and Senate and then passed by both chambers. Given the complexity of this process, it should come as no surprise that it has been years since Congress has passed a NEW and complete budget on time.

 

Once a budget is passed, and the bill is sent to the President for signature, the President still holds power to sign it into law or veto the bill sending it back to Congress. So, while the President's budget may not be THE budget that funds our government, our constitutional system of checks and balances still distributes budgetary power among the branches. And, while the media will continue to focus attention on the yearly ritual of releasing the President's budget, hopefully this short iteration of, "Just the Facts" will help you keep this process in perspective and provide a context through which you can both find interest in what you may hear or read, and appreciate that this budget is just one piece of the federal government's larger budgetary puzzle.

 

*Contributing Author: James Barber

 

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CAPITOLWORKS LLC, 304 E Street NE Washington, DC 20002

202.841.4341

        brooke@capitolworksllc.com          

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