We must change the law to end so-called baseline
budgeting if we are ever to have a prayer to get this Countries fiscal house in
order. Since the Congressional Budget
Act of 1974 was passed, our Federal Government automatically increases spending
every year even if Congress and the Senate do nothing. The spending is "based
on the continuation of existing level of government services." If that wasn’t enough, in 1985, the Deficit
Control Act ensured spending would keep pace with inflation. The baseline also includes
automatic adjustments for anticipated increases in program participation.
Now, every item in the budget increases, many items
increase by up to 10% or more every year, and it does not matter if there is
money to pay for the increases. The only
thing these agencies need to do now to get more money is to just keep spending.
When new budget programs are created, they become part of the baseline
resulting in more money next year without any formal action by Congress. This is why Congress can go since 2009 without
a budget yet spending continues to explode.
Here is an example of how baseline budgeting works. An agency spends $1 billion, so their budget
for the next year automatically increases by $100 million. This increase is considered 0% growth by
Washington budgeting standards. So if Congress
tries to get responsible and they only authorize a $75 million increase, according
to baseline budgeting they cut the program by $25 million. More importantly, the media will portray this
increase as a draconian cut. Those
proposing these “cuts” get vilified. Can
you imagine if someone proposes a real cut?
Since “baseline” budgeting has been implemented, spending
has gotten out of control. In the last few years, it has gotten even
worse. Federal spending increased from $2.7
trillion in fiscal year 2007 to $3.6 trillion in Fiscal Year 2011, a 33%
increase.
Baseline budgeting has no relation to the amount of
income available to spend, like every other serious budget, so how can we be
serious about getting spending under control without eliminating baseline
budgeting?
Seems Hopeless. Its never going to stop.
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