The Myth of the Annual Budget

Rarely do those who live through profound social change appreciate its significance. Traditional modes of thinking interfere with perceptions of reality. Predictions are often confounded in the complexities and uncertainties of the onrush of events. Such is now the predicament of public administrators caught in the throes of the federal budget crisis. Events have moved so swiftly that it is difficult to gain a sense of perspective, much less predict future direction. Where critics once worried about defects in the budget process, today they are more concerned about the possibility that the budget process itself may collapse. Three major explanations have been advanced for the current crisis in federal budgeting. One holds that the budget mechanism requires constant maintenance to perform properly. The current crisis has been precipitated from long-term neglect of essential maintenance. Once the required adjustments are made, the budget process will work smoothly again. Another contends that the disruption of underlying conventions has so heightened political conflict that the budget process has been overstrained. If budget policies were modified to reduce political conflict and conventions were followed, then the current crisis would pass. The third explanation maintains that government has become too big. The budget process cannot handle the load placed on it. A reduction in the size of the federal budget would restore effective budgeting. Although these explanations approach the federal budget crisis from different directions, they seem agreed that the budget process is fundamentally sound and that what needs to be done is to restore the principles on which it rests. In fact, there is good reason to believe that the problems underlying the federal budget are of such an unprecedented nature that the principles themselves are inappropriate and should be changed. Their solutions ignore the changing context of budgeting that makes traditional principles inadequate, even outmoded. What is now required is a fundamental rethinking of the basic principles, particularly the concept of the annual budget itself. Without such a reassessment the budget process will continue to be dominated by inconsistencies and contradictions. The principles of annual choice are denied in the reality of complex flows of funds which overlap from year to year.' Control is the watchword, "uncontrollability" the refrain. Most appropriations are passed after the start of the fiscal year,2 and at its end billions of dollars are reported in unobligated balances.3 Budget unity is contradicted by the large sums of money allocated and spent outside the budget. Each element of the budget process-resolutions, authorizations, appropriations, reconciliation-requires elaborate explanation to reconcile textbook precepts with actual practice. Budget figures, once fairly stable and reliable quantities, evaporate in successive and competing assumptions and estimates. As the budget crisis deepens, budgetary concepts come to resemble myths, while the urgent issues of budgetary adaptation to a changing context remain ignored.