This paper represents a joint project of the Brookings Institution and Committee for a Responsible Federal Budget (CRFB). It builds on and modifies the authors' work in the Taking Back Our Fiscal Future proposal. This joint project is co-authored by the president of CRFB, but does not necessarily reflect the views of all members of the Committee.
Executive Summary
Today's budget-making procedures fail to provide an orderly pathway for helping to resolve disputes about long-term fiscal goals and commitments to Americans.
To help address these weaknesses, we propose a procedure to establish a long-term budget for entitlements, and revenues to sustain them, as part of a reformed federal budget process. The procedure for enacting and revising the long-term budget would have two elements:
Element 1: Congress would enact a 25-year spending plan for the major entitlements, along with a clear funding plan to cover their cost. A long-term budget would also include tax expenditures. The funding plan could include dedicated taxes (e.g., a payroll tax), other revenues, or specified savings from other programs. The long-term budget would be the default for these areas of spending and revenues unless Congress made explicit changes during a formal review conducted every four years after a presidential election.
Element 2: To maintain the long-term budget as the default, we propose an “inside-outside” approach. A commission chosen by Congress and the president would regularly design and implement a package of spending and/or revenue adjustments to keep the long-term budget on track; but a bipartisan and bicameral congressional super-committee could develop an alternative package which would take effect if enacted using an expedited procedure.
