Home | Budget | Contact | Privacy

About The US Federal Budget

Similar to the practice prevailing in many other countries, even the Federal Budget of United States is also determined by the principle of checks and balances. In USA it is the President who proposes the budget to the Congress. The Congress after due deliberations and in accordance with the Federal Constitution passes the budget and also approves the appropriation bills. This bill will have to be passed by both houses namely the Congress and Senate and then it is sent to the President for approval.

Role of SBC and CBO

The budget proposal received from President is referred to the Senate Budget Committee (SBC) and also to the Congressional Budget Office (CBO). At the same time, various other departments of the Federal Government also send their budget needs to SBC and CBO. In the light of the budget proposal received from other agencies, SBC prepares a base line and also project requirements for the next ten years. Similar exercise is also done by CBO. Now, both SBC and CBO submit their analysis to the Congress and Senate. In the backdrop of these reports, both Congress and Senate take up for consideration the budget proposal made by the President. The Congress and Senate have no obligation to approve the budget proposed by the President. At the same time, the President can veto any proposal made by the Congress or Senate. Such a situation can create a void and the respective federal departments would not be in a position to draw any money from the treasury. In such cases, the Congress will pass several appropriate bills as an interim measure. In the meanwhile the Congress will reconsider bill vetoed by the President and such bills will have to be passed with 2/3 majority in each chamber. Once this is done, the bill becomes a law.

The Congress monitors the budget

The responsibility for monitoring of the budget is entrusted to the federal Treasury department, Government Accountability department and also to Congressional budget section. These agencies monitor the budget and periodically report to the Congress. The Federal budget is evaluated on the basis of revenues and outlays and this is called as evaluation of budget on the basis of Cash. According to Article 1, Section 9 and Clause 7 of the Federal Constitution, no federal agency can spend any money without the funds being authorized and appropriated. As already said, it is Congress and Senate; the two bodies authorized to appropriate the budget. Therefore, in effect without the budget being passed by these two houses no federal agencies can spend any money. As a matter of fact, there are 12 subcommittees which are charged with the responsibility of determining the amount required for various federal programs and such proposals are submitted to the Congress. Therefore, although it is the President who proposes the budget it is the Congress which monitors the proposal. The congress has the authority to make suitable changes to the budget proposed by the President. However, this may not happen if the party has majority even in the Congress.

Brief insight into details of federal budget

Now take a look at the sources of revenue and details of expenditure as envisaged in the federal budget. The major source of revenue for Federal Government is taxes and tariffs. Federal borrowings also contribute as another important source of revenue. Expenditure is divided into major group like social security, defense, education, and interest on federal borrowing, pension and other social welfare measures. When the expenditure is more than the expected revenue, obviously it is called as federal deficit. Federal payments are normally grouped into three namely mandatory, discretionary and those payments which require passage of specific laws. Normally, social security and pension are considered as mandatory payments. Whereas defense is grouped under discretionary payments where as interest on borrowing is grouped as payments that require specific law to be passed.

Importance of review by SBC and CBO

The federal budget proposal as also the CBO and SBC reports is announced on the respective websites. That would give a comprehensive view of the financial strength and strategy of the nation. The Federal budget is always based on the long term perception of growth and commitments under various social schemes like the health, pension and so on. In order to achieve this desired goal, while analyzing the federal budget proposal, SBC and CBO prepare a comprehensive budget requirement for the next ten years. This serves as a road map for achieving the desired goal.

The realities

As already said, federal budget is based on the principle of checks and balances. While it is the President who proposes the budget it is the Congress which in effect approves the budget. The Congress has the authority to get over the Veto power exercised by the President. Such a provision has been made so as to ensure that affairs of the federal government are not hindered because of lack of finance. It is also a fact that political viewpoints create abundant hurdles in achieving the goals set up in the budget. For example, Republicans argue that commitments made on popular programs like health and insurance should be reduced. In spite of their reservations to the health and insurance schemes, the very same Republicans hesitate to vote for restrictions on such Programs because they feel it may affect their political prospects. On the other side, the Democrats suggest reduction in the tax burden on common man by taxing the rich. But, they too hesitate to act in this direction because they feel the rich may refrain themselves from making political donations. The growing deficit in budget is another factor worrying the Federal government because it will have a negative impact on the economy.

The 21Century Project Domain

The domain 21centuryproject.org was found via the deleted domains website DomCop and registered through the top website for cheap domain names, Namesilo.com. Having been abandoned, the domain now has articles explaining what the 21century project was about. The website is host on a fast SSD VPS Server from Vultr and we use Uptime Robot's Free Website Monitoring to ensure that the website stays up and fast for all users.


The Federal Government has embarked on several austerity measures so as to contain the deficit. It has also taken several steps to generate more resources without affecting the interests of the common man. In the backdrop of worldwide sluggish economic growth whether the measures initiated by the Federal Government could result in reviving the economy is a question that remains to be answered.