Budget Process: History and Future Directions

Pursuant to a congressional request, GAO discussed the budget process, focusing on: (1) the objectives of the Congressional Budget and Impoundment Act of 1974 that are relevant in today's fiscal environment; and (2) whether the budget process should be redesigned. GAO noted that: (1) the act sought to create a congressional budget as a counterpoint to the President's budget, where Congress could offer a single budget statement on overall fiscal policy; (2) although the budget process has been increasingly aimed at budget reduction, the distinction between overall numbers and the policies to achieve them has become more strained; (3) some objectives of the act have been met and others have been firmly embedded into the framework of the budget debate; (4) the budget process should provide a long-term perspective, facilitate important trade-offs between consumption and investment, and be enforceable and transparent; (5) any attempt to streamline the budget process must consider the relationship between the goal of simplicity and the existing decisionmaking structure in Congress; and (6) Congress needs to periodically look at progress in reducing the deficit.