A Small Change, But a Good Idea

Looks like the White House wants to attack the deficit one small change at a time. After promoting the Reduce Unnecessary Spending Act to give the President expanded rescission authority, today the Administration announced plans to incentivize savings for executive agencies.  The change would allow agencies to keep half of their unused money for a given fiscal year.  The savings kept by the agency would be put in a fund that could be used at their discretion (instead of funds being appropriated for specific purposes as they are in each agency's budget.)  The rest of the savings would go towards deficit reduction.

This move is intended to change the way agencies operate.  Currently, they have to return any money to the Treasury that they don't spend in a given fiscal year, so the current incentive is to spend everything they have, even if it's not necessary.  Granted, this plan would need Congressional approval, and some members would probably rather just cut agency budgets if they are spending more than necessary.  Even so, the savings would be limited.

Nonetheless, CRFB supports this effort.  Even if it does not constitute a large spending cut, it still makes the government run more efficiently. We should be considering these sorts of efforts alongside cutting spending programs and increasing taxes. We applaud the move by the White House, but we're still waiting for a comprehensive plan to get our deficits and debt under control.