Basic Budget and Appropriations Reform

Congress has only completed the full budget and appropriations process on deadline four times since 1977. It becomes more challenging in an election year when many members want to avoid politically sensitive issues — such as healthcare and the environment — which could scare off voters.

As we get closer to the Sept. 30 deadline and the Nov. 8 election, Congress will continue to forego the budget process. Instead they’ll pass a stopgap extension of current funding levels that could ignite another fiscal crisis, or government shutdown, later this year. It is the annual “Continuing Resolution” authorizing continued agency and payroll spending, and Social Security checks, without new Congressional action for the rest of this year.

    “Deadlines? We don’t respect no stinking deadlines!”
    – as might have been said in a famous Bogart film.

The majority, 73%, of American voters are against these kinds of shenanigans and don’t want Congress to increase spending. They know there ought to be a limit on how much money can be put on “America’s credit card.”

The folks in Washington — the president, Congress, Democrats, Republicans — they’re all to blame. But they don’t seem to care. It’s spend, spend, spend; we’ll spend what we want. The budget — what budget? — be damned.

An advocacy group sends out “Uncommon Wisdom Daily,” A Division of Weiss Research and write under the name “Uncommon Wisdom Daily Team.” Thank them for the opening four paragraphs of this message.

The Budget Process is Awkward – and Unnecesary

The United States Congress did not adopt a fiscal year (July 1 – June 30) until [tk] 1890. The law that set it up said the president would submit an annual budget for Congress to consider. The budget law has been changed since then but the idea of “budget planning” is still at the center.

Budget planning is the technique of private business and individuals to lay out numbers for spending and cash inflow for a future period. It is a different process from government fiscal planning. An individual prepares a forecast budget to use both to see how future payments might be divided and also to watch out for new things that violate planning assumptions. In other words, budgets are used to discover as you go along how far you are deviating from your plan.

Government budgets cannot perform that last function. Since appropriations are a law, Congress does not have any time “to modify” the spending except to increase it frequently during a fiscal year and regardless of results.

A Modest Proposal

I was fortunate to serve as a Senate staff member for a Senator on the Budget Committee, 1987-90 (Symms, R-ID). I watched the process and generally it is a systematic analysis and focused way “to plan” the new fiscal year. It controls appropriations, which come later from different committees. But it is never really followed.

What happens are continual “emergencies” and “supplemental” appropriations during the fiscal year, on-going, and at the end of every few years also a Debt Limit Increase confrontation.

Each September 30, the fiscal year ends. Appropriations Laws all expire. Agencies cannot keep paying their staff employees, and beneficiaries stop getting payments on October 1. That never happens because Congress always passes a “Continuing Resolution” to keep on keeping on as if the prior budget appropriations had not expired.


My proposal is to stop at that enactment.
Let the “Continuing Resolution” become the full law governing appropriations for one more full year.

This gives time for the non-money side of Congress, all those Members who do not serve on the Budget Committee nor the Appropriations Committees, also to take some role in supervising and reviewing what their money is actually buying.

If a program is not performing, it deserves NO increase, and if the dollars appropriated shrink due to Federal Reserve policy, let that be the rate of cutting real spending.

Supplemental appropriations are going to happen anyway, for other programs. There is time to look at all the programs, EVERY YEAR, and to evaluate ex post facto how much to reward them for performance.


Who Sets the Minimum Wage?

Debate in the political media about whether the Minimum Wage ought to be $15.00 per hour is silly. I italicized “minimum wage” above because we don’t know what that means, and we all believe we do. It has become “a Thing” instead of a price.

The wages of labor are paid by employers who have work to do and need someone to do it. Sometimes the employers need workers who are smarter than their managers and other times they need workers who are not smarter. They reward the workers accordingly.

Nobody can find anything wrong with that model of correct and moral behavior in the employer-employee relationship. Pay for work performed. Pay promptly. Pay in good “legal tender,” whatever that means.

The idea that a government should create a law telling employers, or potential employers, they are forbidden to pay anyone less than a certain floor price for labor will find itself creating an artificial surplus of labor at the lower supply-curve range. Elementary price theory, long known to be valid.

But what is “magical” about a Federal law? What is more logical about a local law? And what is most logical would be to let each employer decide for his own establishment what the starting or minimum (disliked) wage should be, as workers would want to increase it by demonstrating more quality and effort.