Budget Reform

Budget Reform

Research

James C. Capretta | Mar 25, 2015
Reforming the congressional budget process is no substitute for actual policy changes that can correct the government’s fiscal problems. Yet according to a new study published by the Mercatus Center at George Mason University, the right kinds of process reforms can open up new potential for agreement between Congress and the president and can focus attention on long-term spending commitments.
Courtney A. Collins | Aug 25, 2014
Since its inception, the education system in the United States has been structured in a very decentralized way. The federal government has historically played a limited role in public schools, leaving the majority of decisions to be made at the state and local level. The extent of federal involvement began to widen, however, in 1965 with the passage of the Elementary and Secondary Education Act (ESEA).
Veronique de Rugy, Jason J. Fichtner | Aug 21, 2014
The recent decline in federal deficits should not create a false sense that the national debt is no longer a clear and present threat. While this improvement may be encouraging, it represents only a temporary respite from the government’s growing fiscal imbalances.
David M. Primo | Mar 11, 2014
Alternative presentations of the same budget data tend to offer very different impressions, creating opportunities for a deeper understanding of fiscal health. However, these measures sometimes reflect hidden assumptions about government finances, so even a seemingly neutral way of presenting data often isn’t so neutral. The ability to give different impressions with the same budget data creates the opportunity for policy mischief, as one can tell very different stories about fiscal policy depending on the measure used. We can assess the appropriateness of various spending adjustments by understanding the underlying assumptions in the measures, how to use the measures analytically, and how they might be used strategically. The paper looks at measures of government spending over time, as well as budget forecasts, to demonstrate this logic in practice. It concludes with a case study of President Obama’s fiscal year 2014 budget.
David M. Primo | Jan 21, 2014
The United States faces severe fiscal challenges—most notably, the unsustainable growth of entitlement spending and a mounting debt burden that raises concerns about the government’s ability to pay it back without strangling economic growth. These threats reflect the inability of Congress and presidents to make the hard choices necessary to restore fiscal responsibility to the federal budget. …
Matthew Mitchell | Jan 06, 2014
In recent years, food stamps have constituted about 80 percent of farm bill spending, which may be why nearly 100 percent of public debate has focused there. Unfortunately, with all of the attention on food stamps, both political parties have missed the opportunity for reform that lies in the remaining 20 percent of the farm bill.

Testimony & Comments

David M. Primo | Jul 24, 2014
Constitutional rules, unlike statutory or internal rules, are difficult to change. If written to cover the entire budget, avoid loopholes, and make waivers difficult to obtain, Constitutional rules can provide the enforcement mechanism that will help ensure that specific reforms to entitlements, defense, and other spending areas will not be undone by future Congresses.
| Dec 15, 2011
Anthony Sanders testified before the U.S. House Committee on Oversight and Government Reform Subcommittee on TARP, Financial Services and Bailouts of Public and Private Programs on the role of the U.S. in addressing the European debt crisis.
Veronique de Rugy | Oct 05, 2011
Veronique de Rugy testified before the House Committee on Energy and Commerce, Subcommittee on Oversight and Investigations about a line-by-line budget review process.
Matthew Mitchell | Oct 04, 2011
Matthew Mitchell testified before the House Committee on the Judiciary about state governments' experiences with Balanced Budget Amendments.
Veronique de Rugy | Feb 17, 2011
Veronique de Rugy testified before the House Committee on Oversight and Government Reform about wasteful government spending.
Eileen Norcross | Feb 09, 2011
Eileen Norcross testified before the U.S. House Committee on Oversight and Government Reform on the looming municipal debt crisis.

Research Summaries & Toolkits

Veronique de Rugy, Jason J. Fichtner | Oct 10, 2013
As federal government borrowing is set to exceed yet another debt limit, most are quick to recall—and wish to avoid a repeat of—the 2011 debt-limit showdown. If current rhetoric is any indication, it appears many of the last debate’s lessons have been forgotten. Regrettably, it seems many of the debate’s facts have been forgotten as well.
| Sep 24, 2013
The Mercatus State Policy Guide is intended to summarize and condense the best research available on the most relevant topics. It’s a starting point for discussion, not a comprehensive overview of economic policy. Each statement is supported by academic research, with links provided in the endnotes. Mercatus scholars are available to further explain the results of their studies. We hope the guide will prove to be a valuable tool in your economic policy research.
| Jul 23, 2013
The Mercatus Policy Guide is intended to summarize and condense the best research available on the most pressing topics. It serves as a starting point for discussion, not a comprehensive overview of economic policy. Anyone who wants to go deeper into these studies should consult the references listed at the back. Mercatus scholars are available to further explain the results of their studies. We hope the guide will prove to be a valuable tool in your evaluation of economic policy.
Veronique de Rugy, Jason J. Fichtner, Charles Blahous, Matthew Mitchell | Mar 15, 2013
Despite years without a federal budget, trillion-dollar deficits, and ad hoc, crisis-driven fiscal and economic policies that failed to deal with the looming entitlement crisis, leaders on both sides in Washington are now touting seemingly miraculous progress toward a “fix” to our budgetary woes.
| Feb 13, 2012
This policy brief takes a look at the president's FY2013 budget proposal and emphasizes the need for fundamental reform in the areas of spending, taxes, and the budget process.
Veronique de Rugy, Jason J. Fichtner, Matthew Mitchell | Sep 12, 2011
This toolkit provides members and their staffs with tools to help them evaluate spending bills and start the process of reducing government spending.

Expert Commentary

Feb 11, 2015

It is lamentation season for the few financial regulatory agencies that do not have carte-blanche authority to set their own budgets. The annual ritual should include a mandatory listen to the Rolling Stones: "You can't always get what you want, but if you try sometime, you just might find, you get what you need." Adding to the existing list of questionable interpretations of the song, financial regulators should hear a comforting message in those lyrics: you may not get the budget you ask for, but-with a little more effort on your part to spend carefully-you might just find that the budget you get is big enough to do your job.
Feb 07, 2015

One in three workers are subject to occupational licensing laws that destroy economic mobility. Thankfully, the president would like to change that. It is no secret that there is a lot I do not like in the president’s new budget. It spends too much, it taxes too much and the combo of the two keeps us on the unsustainable fiscal path we are on. However, the president deserves some credit for drawing some attention to the incredible injustice of occupational licensing laws.
Jan 11, 2015

The GOP Congress can make three small but meaningful improvements to our national life, and all it has to do is what it does best: nothing. We often make New Year’s resolutions to improve our lives over the next twelve months. Regardless of the magnitude of the changes we desire, the best way to go about making progress is to commit to attainable goals rather than sweeping ones that we will likely abandon after a few weeks.
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Jan 05, 2015

With the term of current Congressional Budget Office (CBO) director Doug Elmendorf expiring, incoming House Budget Committee chairman Tom Price, along with soon-to-be-named Senate Budget Committee chairman Mike Enzi, will need to choose the agency’s next director. I am confident the eventual choice will be strongly credentialed and capable. This piece describes some criteria I believe should guide this critical decision.
Jan 01, 2015

Foreign aid suffers from a principal-agent problem, in which organizations prioritize donors' political and commercial interests over recipients' needs.
Dec 29, 2014

Today I would like to focus on what hasn’t changed: The commitment of Republicans and Democrats to special business interests at the expense of all of us.

Charts

While the president’s budget proposal is unlikely to go anywhere because Republicans control Congress, it doesn’t change the underlying reality that the long-term budget picture remains bleak because spending will outstrip revenues unless policymakers change course. That means cutting the size and scope of the federal government—not increasing taxes.

Experts

Charles Blahous is the director of the Spending and Budget Initiative, a senior research fellow at the Mercatus Center at George Mason University and a public trustee for Social Security and Medicare. He specializes in domestic economic policy and retirement security (with an emphasis on Social Security), as well as federal fiscal policy, entitlements, demographic change, and health-care reform.
Antony Davies is a Mercatus Center–affiliated senior scholar at George Mason University and associate professor of economics at Duquesne University. He also is a member of the Research Program on Forecasting at George Washington University. He specializes in econometrics, public policy, and economic psychology.
Veronique de Rugy is a senior research fellow at the Mercatus Center at George Mason University. Her primary research interests include the US economy, the federal budget, homeland security, taxation, tax competition, and financial privacy. Her popular weekly charts, published by the Mercatus Center, address economic issues ranging from lessons on creating sustainable economic growth to the implications of government tax and fiscal policies. She has testified numerous times in front of Congress on the effects of fiscal stimulus, debt and deficits, and regulation on the economy.
Jason J. Fichtner is a senior research fellow at the Mercatus Center at George Mason University. His research focuses on Social Security, federal tax policy, federal budget policy, retirement security, and policy proposals to increase saving and investment.
Matthew Mitchell is a senior research fellow at the Mercatus Center at George Mason University, where he is the director for the Project for the Study of American Capitalism. He is also an adjunct professor of economics at Mason. In his writing and research, he specializes in economic freedom and economic growth, public-choice economics, and the economics of government favoritism toward particular businesses.

Podcasts

Veronique de Rugy | February 04, 2015
On Ed Dean’s morning show Veronique de Rugy talks about the newly released budget and what to watch for.

Recent Events

Please join the Mercatus Center at George Mason University and senior research fellow, Dr. Jason Fichtner, for a Capitol Hill Campus program focusing on the key challenges of the federal budget and the critical need for reform.

Media Clippings

Sarah Arnett | Jan 17, 2014
The Mercatus Center cited at Philly.com.
Veronique de Rugy | Oct 08, 2013
Veronique de Rugy cited at USA Today.
Eileen Norcross, Matthew Mitchell, | Jul 23, 2013
Detroit reports an unfunded pension liability of $634 million, but using more accurate accounting methods it's closer to $3.5 billion.
Vincent H. Smith | Jul 17, 2013
Farming, it turns out, is not so risky after all. Smith reports that the annual failure rate for farms is only 0.5 percent, compared to 7 percent for other businesses.
Veronique de Rugy | Jul 16, 2013
Mercatus Center Economist Veronique de Rugy found, “Between fiscal years 2007 and 2010, annual wind subsidies grew from $476 million to nearly $5 billion.”…
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