What problems are associated with the U.S. federal budget process, and what solutions have been offered to these problems?

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kipling2448 | (Level 3) Educator Emeritus

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iThe problems with the federal budget process are many, and solutions have been elusive.

The major problem confronting those vested with responsibility for finalizing a budget to fund the federal government from one fiscal year to the next is conceptually simple to understand, but practically impossible at this stage to rectify.  That problem involves the practice of the government spending many hundreds of billions of dollars more every year than it brings in in revenue.  That practice, involving both political parties, has created a federal debt of staggering proportions, currently measured in the trillions of dollars.  The proposed solutions are to increase revenue, mainly through tax increases, and reductions in spending.  Because the two main political parties fundamentally disagree on whether or how to increase taxes, and which federal programs should be further reduced, the government has remained in a perpetual stalemate, and there is little indication of a change any time soon.

Another major problem affecting the federal budget are the protracted military engagements in which the United States has been involved for over a decade.  The wars in Afghanistan and Iraq (the latter largely over as far as direct U.S. involvement is concerned) cost the American taxpayer hundreds of billions of dollars per year, with no compensatory increases in revenue budgeted to pay for those activities. 

A deep-seeded problem affecting the federal budget involves the practice of members of Congress using their positions on powerful committees to direct federal dollars to their districts or states without proper vetting of those projects for merit, and without a competitive process being utilized.  This "pork-barrel politicking" is an ingrained part of the legislative process, but it accounts for tens of billions of dollars a year of questionable spending inserted into bills for parochial purposes.  While Congress has recently attempted to implement a policy of prohibiting such "earmarks" from being inserted into spending bills, the problem went on so long, and involved so much money, that the cumulative effect has been to add hundreds of billions of dollars more to the federal debt.

Currently, the federal budget is undergoing a process known as sequestration.  Sequestration -- for many years a threat to decimate many federal programs of Congress and the President could not meet budget targets -- involves across-the-board cuts in virtually all federal programs.  While the threat of sequestration has been effective at getting members of Congress to cooperate for the common good, it no longer works as a threat, as is actively being carried out today.  While sequestration represents the single most irresponsible budgeting practice, in that it imposes cuts on all programs regardless of logic or merit, it does have a sobering effect on politicians operating in the public eye.

Sequestration has long been considered the "nuclear bomb" of budget cutting, decimating accounts without regard for collateral damage.  When considering measures taken to address budget problems, however, it has to be discussed as the most potent option available.  The other options -- tax increases and targeted budget cuts -- invariably involve far more partisan bickering, especially when the Social Security and Medicare trust funds enter the discussion.