Last year could have been a big one for Congress, because it was able to pass its first joint balanced 10-year budget resolution since 2001 — a budget blueprint that would have put the nation’s finances on a sustainable fiscal path. Unfortunately, within a month it was ignored.
The truth is America’s budget process is broken, and this dysfunction is preventing Congress from tackling the pressing fiscal challenges facing our country. The current budget process is designed only to spend, which fails hardworking taxpayers. Each year, nearly $3 trillion is spent by Washington without any meaningful congressional review.
What America really needs is a budget process built to save. The Senate Budget Committee has been working on bipartisan solutions that would improve the way Congress considers budget legislation, update the antiquated accounting rules that affect the information Congress uses to make tax and spending decisions, and establish enforceable long-term fiscal targets.
The last time Congress reformed the budget process was in 1974. Times have changed and the 40-year old process has only grown more dysfunctional and antiquated. Today, budgets from Congress and the president are increasingly tossed aside, leaving the country with no long-term fiscal plan.
In the last 15 fiscal years, Congress failed to pass a budget resolution more than half of the time. Until 1998, it had never failed to pass a budget, and as a result of these regular successes, Washington had at least some sense of the budget and spending on a year-by-year basis. Unfortunately, not anymore.
Today, a growing portion of our budget is devoted to entitlements and other automatic spending. When Congress last reformed the budget process in 1974, this type of spending constituted only one-third of what was spent, with two-thirds of the spending provided annually.
Today, 70 percent of federal spending is essentially on auto-pay, year after year, without congressional review or approval. In 15 years, this runaway spending and interest will consume all of the taxes and revenues the federal government collects, crowding out spending on the functions we normally associate with good government, including national defense and border security.
This mandatory spending operates with no connection between funding decisions and program performance. Given that this spending often continues in perpetuity, the least we can do is ensure that it is spent effectively and efficiently.
The good news is there is bipartisan progress on steps Congress can take now to fix America’s broken budget process.
First, Congress can begin to regain control of the nation’s finances by making changes to the way it considers and reviews government spending. For example, Congress could set aside mandatory floor time to focus only on spending and budget legislation. This will keep Congress focused on providing government funding in a predictable, transparent manner, instead of putting off these tough decisions until the next manufactured crisis.
Second, we can update obsolete and antiquated accounting rules. The private sector applies modern advances in economics, accounting, and finance to accurately reflect a business’s financial condition and the potential impact of new policies. But the federal government’s budget rules haven't undergone comprehensive review since 1967, more than 50 years ago. Updating these rules would provide Congress with the honest, accurate information necessary to allocate taxpayer dollars responsibly.
Finally, Congress can get serious about addressing America’s mammoth national debt, which today totals more than $19 trillion and is expected to grow to over $29 trillion by 2026. Long-term, enforceable fiscal targets would concentrate Congress’s and the public’s attention on achieving a sustainable federal budget. Former Budget Chairmen Judd Gregg (R-NH) and Kent Conrad (D-ND) recommended establishing a bipartisan commission to lay out substantive policy proposals that would achieve the long-term revenue, spending, and debt targets. Congress would then be required to consider and vote on the commission’s recommendations.
The time to act is now because we currently spend about $230 billion in interest on our debt every year, even with historically low interest rates. Interest on the debt could soon put America out of the business of protecting its citizens from foreign threats, educating our youth, and building national infrastructure like highways and roads.
These bipartisan reforms wouldn’t solve all of our budget problems, but they are a promising first step towards unsticking the budget gridlock that has gripped Washington in recent years. This will begin to put our nation on not just another path, but a better path.
Sen. Mike Enzi (R-WY), chair of the Senate Budget Committee, is the first accountant to hold that position.