President Reagan has called it a "Mickey Mouse" operation. Democratic liberals speak of it even less kindly. But if official Washington didn't have a budget control process, it would probably have to invent one, if only to provide the perfect scapegoat for political paralysis and fiscal failure.
The process is painful, messy, balky, almost incomprehensible to all but a glassy-eyed few. And it has failed to lead Congress into the promised land of milk, honey and balanced budgets.
But it was never intended to serve as a shortcut to fiscal paradise, solving all the nation's economic problems en route. It was designed as a tool by which Congress could produce a coherent fiscal policy, a way of planning and then measuring congressional action, of forcing Congress to add up its assorted tax and spending decisions every year and sign its name to the result. It was not meant to determine fiscal policy but help pull it together in broad terms, with specific implementing legislation to be enacted later.
And despite what the critics say, the process has worked better than most reform efforts, even though its most recent product, the first budget resolution for fiscal 1983 that Congress finally approved last month, pleases almost no one.
Last year, with Reagan capitalizing on his momentum from the 1980 elections, the political will existed to take extraordinary steps--to reverse nearly a half-century of growth in the government and its social welfare programs.
This year, however, as economic problems intensified and doubts mounted over Reagan's plans for handling them, the congressional resolve was nowhere near as strong, and the budget process was called upon to do the almost impossible.
As the process faltered, Reagan, in a moment of impatient exasperation, blamed it for the absence of the previous year's swift victories. "The most irresponsible, Mickey Mouse arrangement that any governmental body has ever practiced," he fumed at one point, glossing over the fact that the very same process had given him virtually everything he wanted just a year earlier.
Similarly, Democrats complained that the process causes Congress to think only of cutting spending to reduce the deficits; this conveniently ignores the fact that federal expenditures more than doubled in the first six years of the budget process when they controlled Congress and, for four of those years, occupied the White House as well.
Both Reagan and the Congress were attempting to use the process not as a tool for exercising political will, but as a substitute for it.
They were using it for their own political as well as economic ends and then blaming it when the results, because of political pressures and strains, didn't turn out as planned.
Reagan challenged Congress to reduce deficits without touching three of the biggest drains on federal revenues: his huge multi-year tax cut, his massive military buildup and the annual increases in Social Security costs. Both the tax cut and defense buildup were linchpins of his overall policy, and he was not about to let anyone tamper with them. Having been burned so often on the Social Security issue, he was also loath to touch it again, especially in a congressional election year.
This left Congress with the budgetary equivalent of trying to bleed a turnip.
Congressional Republicans didn't like the high deficits that resulted from Reagan's program but were reluctant to defy their president. So they flinched from a budget alternative drafted by Senate Budget Committee Chairman Pete V. Domenici (R-N.M.) that would have restrained Social Security increases and raised taxes far more than Reagan wanted, along with producing considerably lower deficits over the next few years.
As a result, the budget ax fell for a second year in a row on spending programs that most Democrats are sworn to protect, including many in the social welfare area. Democrats, having lost control of the Senate and retaining only nominal control of the House, simply could not protect this spending. In addition, some Democrats were quietly counseling that a defeat was not all bad because it would enable them to campaign this fall against a thoroughly Republican economy. So these programs were put on the chopping block once again, not because the budget control process dictated it, but because the Democrats lacked the votes to stop it from happening.
The result was a hodgepodge of spending cuts and tax increases that nonetheless leaves the country with record-high deficits that many believe will soar even higher than the official projections. But it was achieved in the face of fears only a few months before that Congress, having rejected Reagan's original budget out of hand, could not write a budget of its own, especially one that would require tax increases and spending cuts in an election year.
"Given where they were when they started and given the position the administration took, they've done a lot," says Congressional Budget Office Director Alice M. Rivlin.
Now that Congress finally has a budget, the real test of political will--and of budgetary credibility--is still to come.
The deficit projection of just under $104 billion for next year is predicated on some shaky spending and revenue assumptions that many budget experts, including Rivlin, think may turn out to be overly optimistic as the year unfolds. More importantly, Congress still has to pass the actual legislation to enforce the budget through tax increases and spending cuts, without which the budget is a meaningless scrap of paper.
It won't be the fault of the budget process if Congress fails to deliver on its promises, but it is a safe bet that Congress will be blamed for any failures.
Perhaps an even bigger problem for the budget process is that, despite its rather modest beginnings, it has come to dominate all that Congress is doing in this Reagan era of retrenchment for everything but the military.
Not only does the process take almost all year to finish, pushing nearly everything else aside, but Reagan has tried to make the budget the cutting edge of national fiscal policy, puffing it up as a vital signal to the financial markets, if not the world as a whole, of America's determination to get its fiscal house in order.
The financial markets, which know better, threw no ticker-tape parades for passage of the budget resolution last month. As Domenici noted in trying to explain this lack of enthusiasm, the markets understandably want to see whether Congress follows up its promises with action.
Even if Congress did all it pledged to do in the budget, there is no guarantee that the financial markets and the economy would respond on cue. Deficits alone do not cause high interest rates or inflation, nor does a certain precise blend of tax and spending policy necessarily mean that economic recovery is on the way.
Senate Majority Leader Howard H. Baker Jr. (R-Tenn.) concedes as much, but, with some frustration, notes that Congress has to do something and the budget "is the only lever we have."
The result has been what Rep. Leon E. Panetta (D-Calif.), a widely respected veteran of Capitol Hill's budget wars, describes as a kind of budget overload.
"There's been a gross distortion of the budget process that's undermined the process itself," said Panetta, who respects the process but knows its limits. "Instead of setting general targets and forcing choices in priorities, as was intended originally, it's now been exaggerated to the point where it's the symbol of whether the economy is going to make it or not.... It's now supposed to determine what happens on Wall Street."
Panetta and others believe the process needs at least some fine-tuning to keep it from collapsing under the weight thrust upon it.
Already Congress has required that the target-setting first budget resolution be converted automatically into a final set of spending ceilings if a ceiling-setting second resolution has not been adopted, as the law provides, by the start of the new fiscal year on Oct. 1. Other ideas include two-year instead of annual budgeting and the establishment of closer links between the budget process and the authorizing and appropriating committees, both to avoid turf fights and ease the way for meeting targets. One of the most far-reaching proposals is to combine the budget and appropriating processes into one.
Without at least some reform, Panetta noted mischievously, "Congress may not have the budget process to kick around any more." It would be missed. Congress would have big deficits and nothing to blame them on, except itself.