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  • Print publication year: 2011
  • Online publication date: June 2012

12 - Congress and Budget Politics

Summary

The federal budget is often the center of congressional politics. For fiscal year 2009, the federal government's spending will exceed $3 trillion, or approximately $10,000 for every American. And estimates for fiscal year 2010 project an even larger number. Although many people are bored to tears when the details of spending and tax policy are discussed, the budget reflects fundamental choices about the role of government in American life. Action on the annual budget tends to generate the most partisan fights in Washington. The twists and turns of budget politics have strongly influenced winners and losers in elections, shaped the political careers of the most prominent politicians, reshaped congressional decision-making processes, and altered the distribution of power within Congress.

Federal budgeting since the 1970s has been a roller coaster ride. Beginning in the late 1970s and continuing for more than a decade, presidents and Congress struggled with annual deficits. In fiscal year 1992, the federal government spent about $290 billion more than it received from taxes and other revenues. To pay the interest on the debt that had accumulated over the years (nearly $4 trillion by that point), the federal government spent a little more than $200 billion – about 14 percent of its $1.5 trillion budget for fiscal year 1992. By 1998, the budget picture had improved markedly. Fiscal year 1998 ended with a small surplus, and annual surpluses were achieved in the three following years. Deficits returned by late 2001 during an economic recession. The fight against terrorism and the war in Iraq prompted increases in defense and homeland security spending, while tax cuts enacted in 2001 and 2003 cut into revenues. Deficits were looming again by 2002 and have continued through to the present, greatly deepened by the recession of 2007–2008 and the policies to deal with it. A deficit of nearly $1.5 trillion was projected for fiscal year 2011, a record high.

Schick, Allen Congress and Money: Budgeting, Spending and Taxing Washington, DC The Urban Institute 1980 17
Hass, Lawrence J. Running on Empty: Bush, Congress, and the Politics of a Bankrupt Government Homewood, IL Business One-Irwin 1990