Federal Budget and Tax Policy

Articles & Analysis

The State of the Nation's Budget

The state of the nation's budget can be summarized in one word: underutilized. The economy is still clawing its way back from the worst recession since the Great Depression, but Congress voted to drastically scale back federal spending in 2011 instead of investing in initiatives to spur demand. As President Obama prepares to give his annual State of the Union speech later tonight (Jan. 24), we hope he will argue that in the short run, the federal government should do more, rather than less, to create demand in the economy and leave deficit reduction to 2013 and beyond.

"Do-Nothing" the Best Prescription for Deficit Reduction, but a Bad Approach for the Country

Congress was busy in the days leading up to the winter holidays. At the 11th hour, the fiscal year (FY) 2012 budget finally passed, three months late, along with an extension of the payroll tax cut and a package of other assorted cuts and credits. The only real substantive legislative change coming out of the session was the death of the ethanol tax credit – because Congress failed to pass it. In the year ahead, this might be a theme: change only happens when Congress does nothing.

Small Wins for Transparency in 2012 Spending Package

The fiscal year 2012 spending package signed by President Obama on Dec. 23 included some good news for government transparency and right to know. Many of the worst provisions of the bill were removed from the final compromise, but open government advocates remain concerned.

Fiscal Policy: The Best and Worst of 2011

Welcome to OMB Watch's year-end fiscal policy review, where we give you a retrospective of the good, the bad, and the ugly of fiscal policy in 2011. Some acts, such as increased contracting transparency, made for enjoyable viewing, while others, like the congressional budgeting process, left us crying for a new script. Read on for our take on the year's highlights in revenue, budgeting, and spending.

Battling Income Inequality through Smart Surtax Policies

In spite of the media's developing critical narrative of the Occupy movement, Occupy protesters have succeeded in changing the national political conversation from an obsession with debt and deficits to a focus on the growth in income inequality and the concentration of wealth.

Congress Votes on Balanced Budget Amendment

Even though the Super Committee is stealing the limelight, this summer's debt ceiling deal didn't just create the deficit-cutting committee. It also forces both the House and the Senate to vote on a balanced budget amendment to the Constitution. On Nov. 18, House leadership brought an amendment to the floor, where it failed to get the two-thirds vote necessary to pass. However, the close House vote and the impending Senate vote mean that this is not the end of the balanced budget amendment.

OMB Watch Lauds End of Undemocratic "Super Committee"

WASHINGTON, Nov. 21—The so-called Super Committee announced today that it did not come to an agreement on deficit reduction. This should not be viewed as a failure. OMB Watch decried this undemocratic, unrepresentative, nontransparent process from its inception.

Letter: Open Government Groups Urge Senators to Restore Funding for Transparency Efforts

We are writing to urge you to protect funding for the Electronic Government Fund at the General Services Administration in H.R. 2354, the Energy and Water Development and Related Agencies Appropriations Act. As currently written, H.R. 2354 would not provide adequate funding for the E-Gov Fund’s important programs, which provide critical support for the construction of a more transparent and efficient government and serve as a building block for private-sector innovations that create high-tech jobs.

Deal or No Deal: The False Choice of the Super Committee

The so-called “Super Committee,” charged with creating a $1.2 trillion deficit reduction plan by Thanksgiving, seems to be stalling. If the committee cannot agree to a deal, or if Congress doesn't approve of the plan that the committee produces, the debt ceiling package that passed in August will trigger almost a trillion dollars in automatic spending cuts to both defense and non-defense spending. Congress as a whole appears to be waffling between voting for a deficit reduction plan that many constituents will find unpalatable or allowing the automatic cuts to proceed, which will also make voters unhappy. However, this problem presents a false choice because there is another option: Congress could vote to select "none of the above."

Financial Taxes Can Raise Revenues, May Help Stabilize Markets

The congressional Super Committee, tasked with forging a $1.2 trillion deficit reduction package by Thanksgiving, is currently deliberating on which revenues – if any – to raise and to include in its plan. With Wall Street at the center of the 2008 economic collapse, the committee should look to a pair of revenue options that would fulfill the dual roles of addressing risks to the economy posed by Wall Street and raising much needed revenue: a financial speculation tax and a financial crisis responsibility fee on large financial institutions.