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A History (and Future) of the Budget Process in the United States pp 77–108Cite as

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Building a Visible Government

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Abstract

The progressive budget reformers sought efficiency through standardization, transparency, and bringing business practices to the government. Balancing the federal budget was seen as a form of efficiency. However, the executive budget process created in 1921 was a difficult fit compared to existing institutions. Congress also replaced a system where they governed federal debt on a rolling basis with a series of limits. It is impossible to know for sure how the American Founders would have considered the fundamental reforms of this period; however, the control over taxation and debt had been seen as the primary determinant of sovereignty to be vested in the people. The progressive reformers, of course, believed this power was best placed in the hands of the executive.

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Notes

  1. 1.

    Kennon and Rogers, The Committee on Ways and Means : A Bicentennial History.

  2. 2.

    Jefferson had advocated for both reducing internal taxes and the size of government as president.

  3. 3.

    Advocates did not argue that income was equivalent to personal property. Rather, personal property was not taxed and an income tax was closer to a personal property tax than any other assessment made by the federal government.

  4. 4.

    Adam Smith, An Inquiry into the Nature and Causes of the Wealth of Nations by Adam Smith, ed. Edwin Cannan (London: Methuen, 1904).

  5. 5.

    Sandy Brian Hager, Public Debt, Inequality, and Power: The Making of a Modern Debt State (Oakland: University of California Press, 2016).

  6. 6.

    John Stuart Mill, Principles of Political Economy, 7th edition (London: Longmans, Green, and Company, 1909).

  7. 7.

    Jesse Burkhead, “The Balanced Budget,” The Quarterly Journal of Economics 68, no. 2 (1954): 191–216.

  8. 8.

    Ibid.

  9. 9.

    Ibid.

  10. 10.

    Ibid.

  11. 11.

    David Levy, “Paradox of the Sinking Fund,” in Deficits, by James M. Buchanan, Charles K. Rowley, and Robert D. Tollison (New York, NY: Basil Blackwell, Inc., 1987).

  12. 12.

    Ibid.

  13. 13.

    For instance, Alfred Marshall’s Principles of Economics does not address government debt. (Burkhead 1954).

  14. 14.

    Burkhead, “The Balanced Budget.”

  15. 15.

    Ibid.

  16. 16.

    Ibid.

  17. 17.

    H.J. Cooke and M. Katzen, “The Public Debt,” The Journal of Finance 9. no. 3 (1954): 298–303.

  18. 18.

    Ibid.

  19. 19.

    Douglas A. Irwin, “Higher Tariffs, Lower Revenues? Analyzing the Fiscal Aspects of ‘The Great Tariff Debate’,” The Journal of Economic History 58, no. 1 (1998): 59–72.

  20. 20.

    Barry Eichengreen, Asmaa El-Ganainy, Rui Redro Esteves, and Kris James Mitchener, “Public Debt Through the Ages”, IMF Working Paper Number WP/19/6 (2019).

  21. 21.

    Ibid.

  22. 22.

    Irwin, “Higher Tariffs, Lower Revenues? Analyzing the Fiscal Aspects of ‘The Great Tariff Debate’.”

  23. 23.

    Kennon and Rogers, The Committee on Ways and Means : A Bicentennial History.

  24. 24.

    Grover Cleveland, “Third Annual Message (first term),” The American Presidency Project. John Woolley and Gerhard Peters. December 6, 1887, www.presidency.ucsb.edu/node/204041

  25. 25.

    Irwin, “Higher Tariffs, Lower Revenues? Analyzing the Fiscal Aspects of ‘The Great Tariff Debate’.”

  26. 26.

    Kennon and Rogers, The Committee on Ways and Means : A Bicentennial History.

  27. 27.

    D. A. Irwin (1998) notes that John James in Public Debt Management finds that the government paid as much as 29 percent premiums to chase non-callable debt.

  28. 28.

    Ibid.

  29. 29.

    Ibid.

  30. 30.

    Kennon and Rogers, The Committee on Ways and Means : A Bicentennial History.

  31. 31.

    Joanne Reitano, The Tariff Question in the Gilded Age: The Great Tariff Debate of 1888 (University Park, PA: Pennsylvania State University Press, 1994).

  32. 32.

    Irwin, “Higher Tariffs, Lower Revenues? Analyzing the Fiscal Aspects of ‘The Great Tariff Debate’.”

  33. 33.

    Marc-William Palen, “Protection, Federation and Union: The Global Impact of the McKinley Tariff upon the British Empire, 1890–94”, Journal of Imperial and Commonwealth History 38, no. 3 (2010): 395–418.

  34. 34.

    The tariff also gave the sugar industry a subsidy in an attempt to offset any trouble caused by the repeal of the tariff.

  35. 35.

    Kennon and Rogers, The Committee on Ways and Means : A Bicentennial History.

  36. 36.

    Speaker of the House Charles Crisp speaking, 53rd Cong., 2nd sess., Congressional Record 26, February 1, 1894 (Washington, DC: U.S. Government Printing Office, 1894), 1791.

  37. 37.

    Francis R. Jones, “Pollock v. Farmers’ Loan and Trust Company,” Harvard Law Review 9, no. 3 (1895): 198–211.

  38. 38.

    Oscar Kraines, “The Dockery-Cockrell Commission, 1893–1895,” The Western Political Quarterly 7, no. 3 (1954): 417–462.

  39. 39.

    Bolles (1969) provides a history of the accounting system prior to this period including the issuance of the appropriations warrant and roles of the US Treasurer and other responsible parties.

  40. 40.

    Kraines, “The Dockery-Cockrell Commission, 1893–1895.”

  41. 41.

    Ibid.

  42. 42.

    Gifford Pinchot, Breaking New Ground (New York, NY: Harcourt Brace and Co., 1947).

  43. 43.

    Harold T. Pinkett, “The Keep Commission, 1905–1909: A Rooseveltian Effort for Administrative Reform.” The Journal of American History 52, no. 2 (1965): 297–312.

  44. 44.

    “President Would Cut Out Red Tape: He Tells the Keep Commission That There Is Too Much of It in Departments,” New York Herald, March 24, 1906.

  45. 45.

    Ibid.

  46. 46.

    “President Stops Contract: Mergenthaler Company Believes Politics Figures in Choice of Machines,” New York Times , June 25, 1905.

  47. 47.

    “Typesetting Stock Scandal: Printing Office Inquiry as to Holdings of Employees,” The New York Times , July 4, 1905.

  48. 48.

    “Printer Palmer May Go: Typesetting Investigation at Washington Expected to Cause a Change,” The New York Times , July 14, 1905.

  49. 49.

    “Against Printer Palmer: Commission Would Remove Him and Cancel Type Machine Contract,” The New York Times , August 1, 1905.

  50. 50.

    “Palmer Order Upheld; His Method Censured: President Denounces Mergenthaler Co. for False Charge,” The New York Times , September 11, 1905.

  51. 51.

    “Printer Palmer Ousted: Ignored President’s Order—Ricketts Is in His Place,” The New York Times , September 9, 1905.

  52. 52.

    “Will Not Overrule Palmer: President to Leave Printing Office Removals to Keep Committee,” The New York Times , September 5, 1905.

  53. 53.

    “New Public Printer In: Ricketts Gets an Ovation—Palmer to Demand Investigation,” The New York Times , September 10, 1905.

  54. 54.

    “Palmer Order Upheld; His Methods Censured: President Denounces Mergenthaler Co. for False Charge,” The New York Times , September 11, 1905.

  55. 55.

    “Keep Makes Report on Machine Inquiry: Investigation Into Contract for Typesetting Machines Ends,” The New York Times , August 17, 1905.

  56. 56.

    Valerie Heitshusen, The Speaker of the House: House Officer, Party Leader, and Representative, Report to Congress (Washington, DC: Congressional Research Service, 2017).

  57. 57.

    House Committee on Rules, A History of the Committee on Rules, 1st to 97th Congress, 1789–1981 (Washington, DC: U.S. Government Printing Office, 1983).

  58. 58.

    United States Senate Committee on Appropriations, Committee on Appropriations, 1867–2008 (Washington, DC: U.S. Government Printing Office, 2008).

  59. 59.

    R. Penny Marquette and Richard K. Fleischman, “Government/Business Synergy: Early American Innovations in Budgeting and Cost Accounting,” The Accounting Historians Journal 19, no. 2 (1992): 123–145.

  60. 60.

    Congressional Record , 79th Cong., 2nd sess., March 11, 1946.

  61. 61.

    Marquette and Fleischman, “Government/Business Synergy: Early American Innovations in Budgeting and Cost Accounting.”

  62. 62.

    Ibid; (Rubin 2008) provides another good history of the NYB and the early progressive budget movement.

  63. 63.

    Marquette and Fleischman, “Government/Business Synergy: Early American Innovations in Budgeting and Cost Accounting.”

  64. 64.

    Jonathan Kahn, Budgeting Democracy: State Building and Citizenship in America (Ithaca, NY: Cornell University Press, 1997). Kahn offers a good history of the early budget reformers including The New York Bureau of Municipal Research, the campaign for a national budget system, and the early years of the Bureau of the Budget.

  65. 65.

    Augustus Cerillo, Reform in New York City: A Study of Urban Progressivism (New York: Routledge, 1991).

  66. 66.

    Ibid.

  67. 67.

    Ibid.

  68. 68.

    Marquette and Fleischman, “Government/Business Synergy: Early American Innovations in Budgeting and Cost Accounting.”

  69. 69.

    Ibid.

  70. 70.

    Frederick Cleveland, “Budget Making and the Increased Cost of Government,” The American Economic Review 6, no. 1 (1916): 50–70.

  71. 71.

    A.E. Buck, “The Development of the Budget Idea in the United States,” The Annals of the American Academy of Political and Social Science 113 (1924): 31–39.

  72. 72.

    Cleveland, “Budget Making and the Increased Cost of Government.”

  73. 73.

    The Commission on Economy and Efficiency, 62nd Cong., 2nd sess. “The Need for a National Budget,” U.S. House of Representatives Document 854, June 12, 1912.

  74. 74.

    Ibid.

  75. 75.

    Stephen Skowronek, Building a New American State: The Expansion of National Administrative Capacities, 1877–1920 (Cambridge: Cambridge University Press, 1982).

  76. 76.

    Frederick A. Cleveland, “Review of Budget Making in a Democracy: A New View of Budget Making by Edward A. Fitzpatrick,” Political Science Quarterly 34, no. 3 (1919): 510–512.

  77. 77.

    A.C. Handford, “Review of The Budget and Responsible Government by Frederick A. Cleveland and Arthur Eugene Buck: Evolution of the Budget of Massachusetts, 1691–1919 by Luther H. Gulick,” The American Political Science Review 14 (1920): 711–713.

  78. 78.

    William Willoughby, The Problem of a National Budget (Berkeley, CA: University of California Libraries, 1918).

  79. 79.

    William Taft, “Message of the President of the United States on Economy and Efficiency in the Government Service”, Communication to Congress, April 4, 1912.

  80. 80.

    “Republican Party Platforms: Republican Party Platform of 1916,” The American Presidency Project, June 7, 1916, https://www.presidency.ucsb.edu/documents/republican-party-platform-1916

  81. 81.

    “Democratic Party Platforms, 1920 Democratic Party Platform,” The American Presidency Project, June 28, 1920, https://www.presidency.ucsb.edu/documents/1920-democratic-party-platform; “Republican Party Platforms: Republican Party Platform of 1920,” The American Presidency Project, June 8, 1920, https://www.presidency.ucsb.edu/documents/republican-party-platform-1920

  82. 82.

    G. Granger, “The national budget system,” Editorial research reports 1930 4 (Washington, DC: CQ Press, 1930).

  83. 83.

    The language allowed Congress to remove the Comptroller by resolution.

  84. 84.

    Louis Fisher, “The Politics of Impounded Funds”, Administrative Science Quarterly 15, no. 3 (1970): 361–377.

  85. 85.

    Ibid.

  86. 86.

    John T. Rourke, “The GAO: An Evolving Role”, Public Administration Review 38, no. 5 (1978): 453–457.

  87. 87.

    Hugh Rockoff, “The Origins of the Federal Budget”, The Journal of Economic History 45, no. 2 (1985): 377–382.

  88. 88.

    John McDiarmid, “Public Administration: Reorganization of the General Accounting Office,” The American Political Science Review 31, no. 3 (1937): 508–516.

  89. 89.

    Ferguson , The Power of the Purse: A History of American Public Finance , 1776–1790.

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Winfree, P. (2019). Building a Visible Government. In: A History (and Future) of the Budget Process in the United States. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-030-30959-6_4

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