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Why Federal Budgets Aren't What You Think They Are

For all the attention the president's and Congress' budget proposals receive, they don't actually fund any program or levy any taxes. They're more about politics.

As Republican leaders in the House and Senate unveil their proposed budgets this week, here is the most important thing to remember about the federal budget: It isn't really a budget.

Your school board passes a real budget, and your town passes an actual budget, and so does your state — with long lists of items and how much money each particular item will get. But the federal budget does not detail how much anything gets.

Instead, it explains in broad strokes how its authors would structure federal priorities.

"The bottom line is, the budget resolution is essentially meaningless," said Stan Collender, a former Capitol Hill staffer who spent years working for both House and Senate budget committees.

To understand how this could be, try this thought experiment: Say for the sake of argument that President Obama's budget was just so loved by House Republicans that they passed it without changing a comma.

And then, say that the Senate was equally enamored of the budget and also passed it without a single change.

How much would that change the tax code or military spending or highway construction?

Not at all. Zero.

All of these would require additional legislation to make the proposed changes real.

The reasons for this stem from the creation of the relatively modern budget process in the 1970s, Collender said. Before that process came into being, the original proposal would have authorized the budget committees to actually appropriate money and set tax policy.

But leaders of the appropriations and tax-writing committees protested, so those powers were removed. Instead, the budget committees were left with the ability to set top-line spending and revenue numbers.

If the House and Senate agree and pass a compromise resolution, the overall spending limit, in theory, is a hard cap — although lawmakers can still find a way around it, Collender added.

"If you were going to set up the system from scratch," Collender said, "you would never do it this way."

For Republicans, the budget process does offer a benefit that has almost nothing to do with federal spending: a procedural shortcut that allows them to pass legislation in the Senate without amassing the 60 votes that are otherwise necessary to pass a bill.

Under rules of so-called "budget reconciliation," legislation that is ordered by the adopted budget resolution needs only 51 votes to pass the Senate. This method was used to pass the Bush tax cuts a decade ago and part of Obamacare five years ago. Republicans are now considering using it to repeal at least portions of that health care law.

A congressional budget resolution only needs majority votes in both chambers to take effect and does not go to the president. But a bill that passes Congress under reconciliation rules, like any other bill, does go the president — where a repeal of even a small part of Obamacare is likely to get a veto from its namesake, President Obama.

Copyright 2015 NPR. To see more, visit http://www.npr.org/.

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