| AEI Economic Perspectives
The Congressional Budget Process: A Brief Primer
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The executive and legislative branches of the federal government have separate budget processes, reflecting their coequal status in our constitutional structure. The Congressional Budget and Impoundment Control Act of 1974 established the institutions and procedures that guide budgetary decisions in Congress. The budget process has been amended in several important ways since 1974, including with the introduction of caps for appropriated spending and a pay-as-you-go rule for taxes and entitlements, both of which are enforced with automatic cuts in spending if they are violated. The current process was written for a time when appropriations spending was dominant; it does not work as well with so much of the federal budget devoted to spending that occurs automatically on entitlement programs. Further, the current process does not facilitate executive-legislative agreement on budgetary aggregates, which is an important reason for instability and uncertainty in federal finances.
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