Process and Rules

No Budget, No Plan, No Accountability...No More

CHAIRMAN
Bill Frenzel
Tim Penny
Charlie Stenholm

 
PRESIDENT
Maya MacGuineas
­­­
 
DIRECTORS
Barry Anderson
Roy Ash
Charles Bowsher
Steve Coll
Dan Crippen
Vic Fazio
Willis Gradison
William Gray, III
William Hoagland
Douglas Holtz-Eakin
Jim Jones
Lou Kerr
Jim Kolbe
James Lynn
James McIntrye, Jr.
David Minge
Jim Nussle
Marne Obernauer, Jr.
June O'Neill
Rudolph Penner
Peter Peterson
Robert Reischauer
Alice Rivlin
Martin Sabo
Gene Steuerle
David Stockman
Paul Volcker
Carol Cox Wait
David M. Walker
Joseph Wright, Jr.
 

SENIOR ADVISORS
Elmer Staats
Robert Strauss

 
 
 
 


No Budget, No Plan, No Accountability...No More
May 18, 2010



Well past the April 15 deadline, Congress still has yet to adopt a budget resolution for FY2011. Meanwhile, policymakers are looking to add hundreds of billions of dollars to the debt for additional government spending and tax cuts. And the House and the Senate are eyeing ways to weaken their already weak budget process restraints. The result is an already dangerous fiscal situation, growing ever-more dangerous each day.

Instead of disregarding fiscal discipline and pushing forward major initiatives that are not paid for, Congress must consider the long-term fiscal and economic impact of the decisions they are making today. Legislators must think beyond the next election and develop a plan now for the longer term. Here is where we stand:

Chances for budget resolution fading. Each passing day without a decision on a budget resolution makes it less likely that Congress will adopt a basic budget blueprint. Many politicians would rather not have a budget debate that will highlight mounting deficits and debt in an election year and either the hard choices involved in getting the debt under control, or their failure to make those choices. The very reasonable push to reduce some discretionary spending has left the House unable to agree on a plan.

“That so many members of Congress are unwilling to consider even relatively small spending reductions does not bode well for the type of budget discussions we should be having,” said Maya MacGuineas, president of the Committee for a Responsible Federal Budget. “Large structural changes to the budget will have to be considered—the types of changes currently being suggested are merely the opening act for what is to come.”

Lack of a budget is no excuse for adding to the debt and avoiding the fiscal problems. According to its rules, the House may now begin considering appropriations bills without a resolution in place. Spending decisions should not be made without firm limits. There is growing talk that Congress may simply “deem” a discretionary spending figure for appropriators to divide up this year and attach such a deeming resolution to other must-pass legislation. That process would deny members the opportunity to hold a separate debate on this year’s overall spending levels.


“Having no budget is no reason to add further to the debt,” added MacGuineas. “If a deeming resolution is used, it must emphasize fiscal restraint. Failing to pass a budget should not be an excuse to open the spending floodgates.”

PAYGO must be strengthened, not weakened. There are also reports that such a deeming resolution may be billed by Democrats as a “budget enforcement resolution” and include provisions reaffirming the commitment of congressional leaders to bring the recommendations of the White House deficit commission to a vote and bringing pay-as-you-go rules in line with statutory PAYGO requirements. However, the PAYGO law passed by Congress earlier this year contains several major exemptions totaling upwards of $2 trillion, including for the Medicare “doc fix” and extensions of the 2001/2003 tax cuts for the middle class.

“The new statutory version of PAYGO has loopholes so absurdly large, you could drive a tanker through them. The rules in the House and Senate are far more responsible and consistent with previous iterations of pay-as-you-go budgeting. Instead of trying to bypass the basic principle that we need to pay for what we spend and the sensible PAYGO rules, lawmakers should be figuring out how to comply with them,” said MacGuineas.

“Extenders” bill should not extend the debt. Congress wants to enact legislation that would extend until the end of the year popular tax breaks such as the research and development tax credit and social programs like expanded unemployment benefits and COBRA subsidies for the jobless. Democrats will likely unveil a bill that contains offsets for the tax cuts, but not the social spending. The proposal may also include a five-year extension of the “doc fix” that isn’t paid for. And Congress may also attempt to enact a permanent extension of the estate tax at levels that would violate even the weak statutory PAYGO currently in place.

“Congress cannot continue to act as though there are no consequences to adding to the debt,” said MacGuineas. “What are we doing—looking at Greece and saying ‘oh that looks like fun, let’s give that a try’? As the federal debt continues to soar, investors are watching lawmakers and as problems abroad clearly demonstrate, investor confidence is crucial. We should stop considering every bill as an ‘emergency’ in order to bypass PAYGO and pay for stimulus measures over the longer term so that they do not add to the long-term debt.”

Deficit reducing measures should actually reduce the deficit. Finally, the House is said to be looking into ways to ensure that savings from the President’s Fiscal Commission are preserved for deficit reduction. This is an excellent idea. The last thing we need is to see this money used to finance new spending or tax cuts. For that matter, savings from the health reform bill, which are currently on the PAYGO scorecard, should not be used to offset the costs of other borrowing either.  

 


Click here for a pdf version of this release.

For press inquiries, please contact Kate Brown at (202) 596-3365 or brown@newamerica.net.

 

 

Joint Statement on the National Commission on Fiscal Responsibility and Reform

What CRFB Would Like to See in the FY 2011 Budget

CHAIRMAN
Bill Frenzel
Tim Penny
Charlie Stenholm

 
PRESIDENT
Maya MacGuineas
­­­
 
DIRECTORS
Barry Anderson
Roy Ash
Charles Bowsher
Steve Coll
Dan Crippen
Vic Fazio
Willis Gradison
William Gray, III
William Hoagland
Douglas Holtz-Eakin
Jim Jones
Lou Kerr
Jim Kolbe
James Lynn
James McIntrye, Jr.
David Minge
Jim Nussle
Marne Obernauer, Jr.
June O'Neill
Rudolph Penner
Peter Peterson
Robert Reischauer
Alice Rivlin
Martin Sabo
Gene Steuerle
David Stockman
Paul Volcker
Carol Cox Wait
David M. Walker
Joseph Wright, Jr.
 

SENIOR ADVISORS
Elmer Staats
Robert Strauss
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 


What CRFB Would Like to See in the FY 2011 Budget
January 28, 2010



On Monday, February 1, President Obama will unveil his FY 2011 budget. Although the President offered a preview of some portions of the budget last night, many questions remain. Given the United States’ mounting debt, the budget must begin the process of closing our fiscal gap. In particular, CRFB hopes that the administration’s FY 2011 budget request:

1) Commits to an ambitious, yet attainable, fiscal goal. Given the nation’s current fiscal picture, U.S. creditors need to be reassured that the country intends to take control of our future debt path; to do this, the country needs an aggressive, yet realistic, fiscal goal. The Peterson-Pew Commission on Budget Reform has recommended stabilizing the debt at 60% of GDP by 2018, but this is by no means the only option. The important thing is that a goal be ambitious enough to avert a fiscal crisis, but realistic enough that it is viewed as credible. It is also important that a fiscal goal capture the need to deal with both the medium- and long-term fiscal imbalances – such as the case with a goal of stabilizing the debt so it does not grow as a share of the economy once the target is hit.

2) Details specific actions for meeting fiscal goals. It isn’t enough to set a fiscal target; the President must also provide specific policy proposals to achieve the goal. The partial discretionary spending freeze President Obama discussed last night is a good start, but stabilizing the debt likely will require changes to Social Security, Medicare, Medicaid, defense, and tax policy as well.

3)Avoids using gimmicks. The President’s budget must be able to meet his fiscal targets without relying on any budget gimmicks. For example, assuming that certain policies will expire when they are unlikely to can make it seem easier to stabilize the debt. Relying on unspecified savings (sometimes called “magic asterisks”), such as those suggested by a fiscal commission, also would be problematic – unless some type of “trigger” were put in place to implement tangible policies if an agreement could not be reached.

4) Enforces fiscal targets through budget rules and process reform. To codify his proposed targets, we encourage the President to insist on fiscal rules – such as an exemption-free PAYGO, statutory budget caps, and a debt trigger – to help maintain the fiscal path Congress chooses. Other reforms designed to bring transparency, order, and a focus on the long-term to the budget process also would be helpful.

“This is a critical year for the budget,” said Maya MacGuineas, president of the Committee for a Responsible Federal Budget. “As the White House pivots from focusing on economic recovery to reducing the deficit, it needs to start the discussion by presenting an aggressive and credible budget. But the story doesn’t end there. It is an election year and President Obama will have to use a good deal of his political capital to get Congress to work with him on enacting any of the tough measures he is willing to put forth.”

 


Click here for a pdf version of this release.

For press inquiries, please contact Kate Brown at (202) 596-3365 or brown@newamerica.net.

 

CRFB Supports Creating a Statutory Commission

CHAIRMAN
Bill Frenzel
Tim Penny
Charlie Stenholm

 
PRESIDENT
Maya MacGuineas
­­­
 
DIRECTORS
Barry Anderson
Roy Ash
Charles Bowsher
Steve Coll
Dan Crippen
Vic Fazio
Willis Gradison
William Gray, III
William Hoagland
Douglas Holtz-Eakin
Jim Jones
Lou Kerr
Jim Kolbe
James Lynn
James McIntrye, Jr.
David Minge
Jim Nussle
Marne Obernauer, Jr.
June O'Neill
Rudolph Penner
Peter Peterson
Robert Reischauer
Alice Rivlin
Martin Sabo
Gene Steuerle
David Stockman
Paul Volcker
Carol Cox Wait
David M. Walker
Joseph Wright, Jr.
 

SENIOR ADVISORS
Elmer Staats
Robert Strauss
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 


CRFB Supports Creating a Statutory Commission
January 25, 2010
 

The Committee for a Responsible Federal Budget (CRFB) supports creating a statutory commission to help deal with the nation’s budgetary challenges.

As part of the discussion on whether to increase the debt ceiling, the Senate is scheduled to vote this week on an amendment offered by Senator Kent Conrad (DND) and Senator Judd Gregg (R-NH) to create a task force that would make specific recommendations for how to address the nation’s fiscal imbalances. President Obama endorsed the commission this weekend.

It has long been the Committee for a Responsible Federal Budget’s preference that Congress directly addresses these urgent budget challenges, but given the seeming unwillingness to do so under regular order, CRFB thinks a commission would be beneficial.

“A commission is certainly not a cure-all,” said Maya MacGuineas, president of the Committee for a Responsible Federal Budget. “Our leaders must still make hard tax and spending choices, and sell them to the American people. But a commission can help to jump-start the critical process of crafting a sensible fiscal plan for the country, and make that process just a little bit easier.”

A budget commission offers a number of potential advantages including:

  • Sending a credible signal to creditors and financial markets that the US is serious about tackling its fiscal challenges 
  • Establishing a shared fiscal goal
  • Creating a bipartisan forum in which to discuss budget issues
  • Establishing a process to ensure that the recommendations are considered
  • Lending political cover

“The country now faces both medium- and long-term budget challenges. A commission will probably need to work toward two goals: stabilizing the debt in the medium term, and then bringing it down to manageable levels over the longer term,” MacGuineas said.

“The most important ingredient for success is that there is bipartisan buy-in. Nothing should be taken off the table in establishing a commission, both to help facilitate broad buy-in and because the problem is so large that all policy options will have to be considered” said MacGuineas.

 

Click here for a pdf version of this release.

For press inquiries, please contact Kate Brown at (202) 596-3365 or brown@newamerica.net.

 

Red Ink Rising

Download this document

In Red Ink Rising: A Call to Action to Stem the Mounting Federal Debt, The Peterson-Pew Commission on Budget Reform calls on policy makers to stabilize the national debt through a six-step plan. Crafted over the past year by former heads of the CBO, OMB, GAO, and the congressional budget committees, the plan reflects a bipartisan approach to avoiding the tremendous global risks of America's expanding debt, without destabilizing the economic recovery. Red Ink Rising is the first of two major reports to be released by the commission.

Op-Ed: Congress' Bad Record of Passing Appropriations Bills Shows Need for Budget Process Reform

The Hill | Dec. 10, 2009

 

In the next few days, the House and Senate will engage in their usual end-of-year dance and vote on two massive omnibus appropriations bills to keep the government funded. The bills will help avoid another series of stopgap Continuing Resolutions that have kept the lights on in much of the federal government since October 1—the start of the new fiscal year. Lawmakers, anxious to leave for the year and smelling the proverbial jet fumes, will consider the omnibus bills “must-pass” since they include seven of the “regular” appropriations bills needed to fund everything from veterans’ benefits to railroad safety.

Once again, the much-vaunted “regular order” has been thrown out the window. But in January, members will return to the Capitol and promise that things will be different. The appropriations bills will be finished on time. But will they? The last time Congress was able to complete all of the appropriations bills individually by the start of the new fiscal year was 1994. Republicans love to blame the Democrats for the mess and Democrats take every opportunity to blame the Republicans. But neither party has managed to find a way to make the trains run on time.

Now, this may all seem like inside baseball, but the impact is serious. Managers of federal programs, already well into developing their next year’s budgets, still do not have their final Fiscal 2010 funding levels. Then there’s the question of whether lawmakers seriously discuss federal priorities when spending programs are lumped into a huge piece of legislation. If Congress cannot not even pass the annual appropriations bills on time, how can we expect it to deal with the unsustainable fiscal path that awaits us over the next decade?

Is there a better way to do things? Can a process be developed that will work even with sharp partisan divides on Capitol Hill? The Peter G. Peterson Foundation, The Pew Charitable Trust and the Committee for a Responsible Federal Budget believe that there is a better way and have established The Peterson-Pew Commission on Budget Reform This commission will make recommendations for how best to improve the nation’s fiscal future.

Copyright 2009, The Hill

CRFB Supports Fiscal Task Force

CHAIRMAN
Bill Frenzel
Tim Penny
Charlie Stenholm

 
PRESIDENT
Maya MacGuineas
­­­
 
DIRECTORS
Barry Anderson
Roy Ash
Charles Bowsher
Steve Coll
Dan Crippen
Vic Fazio
Willis Gradison
William Gray, III
William Hoagland
Douglas Holtz-Eakin
Jim Jones
Lou Kerr
Jim Kolbe
James Lynn
James McIntrye, Jr.
David Minge
Jim Nussle
Marne Obernauer, Jr.
June O'Neill
Rudolph Penner
Peter Peterson
Robert Reischauer
Alice Rivlin
Martin Sabo
Gene Steuerle
David Stockman
Paul Volcker
Carol Cox Wait
David M. Walker
Joseph Wright, Jr.
 

SENIOR ADVISORS
Elmer Staats
Robert Strauss
 
 
 
 
 
 



CRFB Supports Fiscal Task Force
December 9, 2009


The Committee for a Responsible Federal Budget commends Senators Kent Conrad (D-ND) and Judd Gregg (R-NH) on their proposal - released today - to create a Bipartisan Fiscal Task Force.

With the public debt above 50 percent of GDP and rising steadily, and Americans increasingly frustrated with the inability of Washington to deal with the dire situation, some type of commission, task force, or budget summit would be a sensible approach to break through the partisan deadlock to foster fiscal responsibility.


“A bipartisan commission would greatly help politicians address the nation’s long-term fiscal challenges,” stated Maya MacGuineas, President of the Committee for a Responsible Federal Budget. “Establishing a budget commission could send an important signal to creditors that the U.S. is serious about fixing the budget situation, create a bipartisan forum where lawmakers can hash out the compromises that will be necessary, and lend political cover for making the tough choices ahead.”

Another important benefit of a fiscal commission is that it could create a shared fiscal goal as a focal point for achieving real solutions. The bipartisan Peterson-Pew Commission on Budget Reform, a joint venture of CRFB, the Peter G. Peterson Foundation, and The Pew Charitable Trusts, has been working to develop an appropriate goal for dealing with the growing debt and will release a report, Red Ink Rising: A Call to Action to Stem the Mounting Federal Debt, on December 14 at the National Press Club with a six-step plan.

“Unfortunately, the gridlocked and dysfunctional legislative process has proven unable to deal with the coming fiscal crisis, and time is quickly running out,” said MacGuineas. “Establishing a bipartisan task force that promotes collaboration and honest discourse with an expedited process for considering its recommendations can overcome the polarization and disorder in Washington to effectively fix the budget situation and place the U.S. on a sustainable fiscal path. It is less important to us the specifics of any commission or task force than the reflection that Congress and the White House are finally willing to turn their attention to this pressing problem.”



Click here for a pdf version of this release.

For press inquiries, please contact Kate Brown at (202) 596-3365 or brown@newamerica.net.

 

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