BUDGET PROCESS: Evolution and Challenges.

To understand where we are it helps to know where we ve been. The budget process of today was not created in a single step. Rather, it was created in stages-and for the most part new pieces did not replace but were added to existing processes. Looking back at the objectives and structure of the 1974 Congressional Budget and Impoundment Control Act is very useful. The Constitution gives the Congress the power of the purse. The 1921 Budget and Accounting Act centralized power over executive agency budget requests under the President and-to balance this grant of power-moved control of the audit of spending from the Treasury to a new legislative branch entity, the GAO. The Congress also centralized its own spending decisions in the House and Senate Appropriations Committees. A budget process should provide information about the long-term impact of decisions while recognizing the differences between short-term forecasts, medium-term projections, and a long-term perspective provide information and be structured to focus on the important macro trade-offs, e.g., between consumption and investment provide information necessary to make informed trade-offs on a variety of levels, e.g., between mission areas and between different tools and be enforceable, provide for control and accountability, and be transparent.