A Budget Out of Control

June 22, 1953

We are witnessing once more the sad spectacle that has repeated itself again and again over the last twenty years—the utter rout and defeat of the forces for economy.

President Eisenhower, who started off so bravely a year ago with the statement that the Federal budget could be cut as much as $40,000,000,000 in the next few years, is planning to spend in the next fiscal year more than $74,000,000,000—an amount higher than was spent in any fiscal year under Truman. Yet it is not these terrific expenditures that are receiving the brunt of criticism in Congress and in the press, but the one major economy proposed in the military budget. And nowhere else in the budget is a major cut even being seriously proposed.

That the forces of economy should have been routed in 1934, when Federal expenditures jumped to nearly $7,000,000,000 and the debt to $27,000,000,000, was deplorable enough. But that the forces of economy should be just as thoroughly routed in 1954, when Federal expenditures are to be $74,000,000,000 and the Federal debt is scheduled to exceed $270,000,000,000, is enormously more serious. If proposals for government economy are dismissed even more peremptorily today than they were twenty years ago—though the rate of Federal expenditures and the national debt have both increased tenfold—then there must be some persistent factor at work that calls for the most urgent analysis and correction.

That factor is not mysterious. It is the lack of anything approaching a responsible budget system. Even the accounting is so chaotic that no one seems to know where we stand. President Eisenhower has been complaining that he has no real control of the budget because of a carryover into the next fiscal year of some $81,000,000,000 of funds appropriated and committed but not yet spent. He is treating this carryover as practically irreducible and nonre-scissible. Yet the Joint Congressional Committee on Reduction of Nonessential Federal Expenditures (the Byrd committee) pointed out in a recent report that some $5,200,000,000 of this amount was in fact still uncommitted and unobligated. And it added: “Experience indicates the firmness of some of the so-called obligations may be subject to review.” On the other hand, the committee includes not only this $81,000,000,000 in its total of unexpended balances, but more than $20,000,000,000 of “revolving and management funds”—bringing its own total estimate to $102,000,000,000.

Our budget “system” is set up for the spenders, not for the economizers. Almost any of the reforms that have been suggested would do at least some good. This is particularly true of the Byrd proposal for a single annual appropriation bill, and of the Coudert proposal for keeping Federal expenditures within revenues except in time of war or grave national emergency (see this column of May 4).

But we will never have a responsible budget in this country until we have removed the chief reason for irresponsibility. This is the power of the House of Representatives to increase expenditures beyond those proposed by the President and the power of the Senate to increase expenditures beyond those voted by the House. The result is a triangular competition in extravagance.

Nothing quite parallel exists in any other leading country. No other country could afford it. In Great Britain the wholesome rule has been immemorially established that Parliament has no power to increase expenditures beyond those proposed by “the government.” The Congressional “power of the purse” can be rightly understood only as the power of withholding or denying the purse. When Congress can put its own hands in the purse, in order to propitiate pressure groups, then there is no one left to represent the interests of the taxpayers. It is only when Congress has the power of reducing expenditures, but not of increasing them, that competition in economy will supplant the present competition in extravagance.