Hearing of the House Budget Committee - Alternate Approaches to Federal Budgeting

Hearing

This committee has spent its past several hearings examining the failures of the current Congressional budget process and the need to overhaul the system and rewrite the rules under which we budget. We have focused attention on the core challenges we face and the fundamental goals we ought to have in attempting to improve the way Congress approaches its fiscal responsibilities. Today, we will begin to shift our attention to what sort of specific approach or approaches could best serve our goal of fiscal responsibility and a more effective, efficient, and accountable government.

Examining the varied virtues of different budgeting styles takes the discussion beyond the conventional understanding of a budget as more or less just a series of numbers. As we have throughout this process, we welcome and encourage the members of this committee and our expert panel of witnesses to seize this opportunity to uproot the conventional and reframe the budget conversation as one of policymaking, not just number crunching.

Among the alternative approaches this committee ought to consider, there is performance-based budgeting to take into account how well different federal programs are achieving their intended outcomes. Through its oversight responsibility, Congress already ought to be measuring the success of a program by its outcomes. From a budgetary standpoint, we ought to encourage that and reward it.

There is capital budgeting to account for long-term capital investments beyond the day to day operations of the federal government. Not all spending is the same. Not all spending operates on the same timeline. Perhaps we ought to have a system that can recognize that fact.

Portfolio budgeting is an approach that would account for the full range of fiscal policies that promote broader national priorities. This would apply a more holistic perspective that could help focus the attention of policymakers on the success or failure of broad goals and strategies to achieve those goals over time.

Lastly, I would be remiss if I failed to mention zero-based budgeting which is aimed at determining the correct starting point from which we build a budget.

Each of these different approaches to budgeting -- and surely there are others -- accentuates a different pathway to achieving a similar goal -- namely a more competent government that is able to serve the nation's priorities in a more sustainable fashion. By approaching the budget in a framework outside or beyond purely financial terms -- dollars in and dollars out -- we allow the budget process to embrace the broader spectrum of policymaking.

Every program and initiative that Congress considers does tend to have a dollar amount attached to it. Common sense, however, tells us that the price tag of a program is not necessarily reflective of its true value. A cost evaluation can underestimate or overestimate the impact or benefit of any given program, and being able to afford something is not justification enough for doing it.

We know from the debates we have each year in this committee that budgets are not simply spreadsheets. They reflect our governing philosophy and our priorities. We ought to have a process that understands this broader nature of our budgets and focuses our energy on goals beyond merely the fiscal health of the country.

By bringing forward a diverse array of budget styles we inevitably invite the challenge of complexity into our budget process. We have no interest in replacing a system that is frustratingly complex to the point of being ineffective or ignored with one that is equally opaque and layered with incongruent rules. It is quite possible consensus will eventually form around a new budget process that incorporates different parts of different approaches. We must ensure that they piece together in a cohesive and coherent fashion.

We are joined today by the Honorable Maurice P. McTigue, Vice President for Outreach at the Mercatus Center at George Mason University; John Hicks, Executive Director of the National Association of State Budget Officers; Scott Lilly, Senior Fellow at the Center for American Progress; and Dr. F. Stevens Redburn, Professorial Lecturer at the Trachtenberg School of Public Policy and Public Administration at George Washington University.

Thank you all for being here and for my colleagues for their continued attention and interest in this matter.

And with that I yield to the acting Ranking Member, Mr. Yarmuth.

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