The Basics of Budgeting

A large portion of federal spending is what’s known as mandatory spending (that is, spending that goes on outside of the regular appropriations process). Social Security, Medicare, and Medicaid are some of the most well-known mandatory spending programs.

 

The rest of spending (except for interest on the debt) is passed through the appropriations process, or continuing resolutions.

 

The regular appropriations process is complex and has grown more complex over time. Ideally, it begins in January or February, when the President submits his budget request to Congress, along with the advice and assistance of the Office of Management and Budget. The Congressional Budget Office will analyze the request and give it a price tag.

 

At that point, Congress should take action. The House budget committee and the Senate budget committee each consider the President’s proposal in March, passing their own budget resolutions by April 1. A conference committee then irons out the differences, presenting a joint budget resolution (the Ryan-Murray deal is an example of such a resolution).

 

The House and the Senate have twelve appropriations committees and various subcommittees for each appropriations committee; the appropriations committees authorize spending limits, and the subcommittees then begin to “mark up” the bills – allocating money and funding programs. The final results must then be passed and sent to conference committees to iron out the differences before the final versions are sent to the president for signature.

 

Continuing resolutions, or CRs, are temporary funding bills that Congress must pass in order to keep the government running if the regular appropriations process isn’t finished before the start of the fiscal year on October 1, or if funding from a previous continuing resolution runs out at any time during the year.