To Get a Responsible Budget

March 21, 1955

The Democratic proposal for a $20 cut in everybody’s income tax is the most disturbing example so far of the almost complete fiscal irresponsibility in Washington.

The Federal budget has become a political football. Fiscal responsibility has been forgotten in a sordid scramble for partisan advantage. For this situation neither party can escape blame, nor can the Congress or the President. Mr. Eisenhower in January submitted a budget which carried the 23rd deficit in the last 26 years. We were supposed to be gratified because this deficit was “only” $2.4 billion. Yet a year ago the President estimated a deficit of $2.9 billion for the current fiscal year, which is now estimated at $4.5 billion. The deficit for the new fiscal year seems even more underestimated than the last one. In addition, Mr. Eisenhower has proposed huge new spending programs on schools and roads outside the Federal budget. Even without the proposed Democratic cut, the budget deficit threatens to reach $4 billion.

This is what made it so difficult for Mr. Eisenhower to present a convincing case against a Democratic proposal that would have raised the deficit by at least $2 billion more. In the present situation, in fact, only a handful of men in either party dare to talk of a budget balance or of real economy.

This is fiscal demoralization. It has become all but futile to argue against specific spending schemes or the perpetual deficit. Real hope lies only in a complete reform of budgetary procedure itself. We must establish a responsible budget system.

For 22 years one man in Congress, Senator Byrd of Virginia, has stood above all the rest in the courage and persistence he has shown on behalf of economy and fiscal responsibility. He has now introduced a proposed constitutional amendment which recognizes the urgency of a reform in fiscal procedure itself. This amendment would permit Congress by law to authorize the President to veto any item in an appropriation bill, without being forced to veto the entire measure.

A similar proposal has long been advocated by outstanding leaders in both parties, conservatives and liberals alike. It was urged in 1937, for example, by Republican Senator Vandenberg, and supported then by President Roosevelt. The power of “item veto” over revenue bills is already possessed by the governors of thirty-seven states. Some of them also have the power of reducing any item.

A constitutional change of this sort would surely bring us nearer to fiscal responsibility. But it may be doubted whether in today’s conditions it would go far enough. Perhaps Senator Byrd drafted his amendment in the form he did—merely giving the President the power of item veto, and making even that subject to authorization by Congressional law—because he feared that anything stronger would have difficulty getting through Congress. Yet the most wholesome system for controlling the budget, if it could be achieved here, is that which has long prevailed in Great Britain, under which the legislative branch may reduce, but cannot increase, the total expenditures proposed by the executive branch.

A budget procedure very close to this, in fact, is prescribed by the constitution of New York State. The governor’s annual budget must not only give estimated expenditures and revenues for the next fiscal year, but must be accompanied by a bill or bills containing all the proposed appropriations and any proposed new taxes. The legislature (I quote the state constitution) “may not alter an appropriation bill submitted by the governor except to strike out or reduce items therein.” If the legislature wishes to increase or add any appropriation, it must be by separate items or bills “each for a single object or purpose” which “shall be subject to the governor’s approval.” In addition to this control, the governor is given explicit power to veto individual items in appropriation bills.

Nothing short of these combined restraints, I fear, can now give us a responsible Federal budget.