Revision of the Federal Budget System

December 27, 1939

Report Outline
Proposals for Change in Budget System
Adoption of Federal Budget System
Formulation of the Executive Budget
Extraordinary and Supplementary Budgeting
Action by Congress on Executive Budget

Proposals for Change in Budget System

Influential members of both parties in Congress have announced that they will seek action at the 1940 session on plans to overhaul the federal budget system. Projected changes would require submission by the President of a “balanced budget,” restrict executive discretion in formulating the government's financial program, and alter legislative procedure for review of the budget.

Senator Tydings (D., Md.), a member of the Senate Appropriations Committee, gave notice December 22 that he would offer an “automatic budget-balancing law” for adoption at the next session of Congress. It would prohibit Congress from appropriating more money in any one year than the government expects to receive from all sources in that year, unless concurrent legislation is enacted to raise additional revenue and liquidate the deficit within 15 years.

The present budget system is a farce [Tydings said].…The country needs a new budget law badly. … One administration can spend billions of dollars it does not have, and artificially create the mirage of prosperity. However, the next administration not only has to pay the cost of government during its tenure of office but for the preceding administration as well when the time comes to balance the budget. Congress should not be permitted to appropriate more money than it takes in, in peacetime, without providing at once, or over a period of years, the means of raising revenue necessary to liquidate the new debt.

ISSUE TRACKER for Related Reports
Federal Budget and National Debt
Sep. 01, 2017  National Debt
Jul. 12, 2013  Government Spending
May 15, 2012  State Capitalism
Mar. 18, 2011  National Debt
Nov. 14, 2008  The National Debt
Dec. 09, 2005  Budget Deficit
Apr. 13, 2001  Budget Surplus
Feb. 01, 1991  Recession's Regional Impact
Jan. 20, 1984  Federal Budget Deficit
Sep. 09, 1977  Federal Reorganization and Budget Reform
Nov. 24, 1972  Limits on Federal Spending
Jan. 08, 1969  Federal Budget Making
Dec. 06, 1967  National Debt Management
Aug. 01, 1962  Fiscal and Budget Policy
Nov. 27, 1957  National Debt Limit
Mar. 20, 1957  Spending Controls
Dec. 24, 1953  Public Debt Limit
Feb. 13, 1952  Tax and Debt Limitation
Nov. 30, 1949  Government Spending
Jan. 06, 1948  Legislative Budget-Making
May 23, 1944  The National Debt
Feb. 01, 1943  The Executive Budget and Appropriations by Congress
Dec. 27, 1939  Revision of the Federal Budget System
Oct. 10, 1938  The Outstanding Government Debt
Nov. 20, 1937  Budget Balancing vs. Pump Priming
May 02, 1936  The Deficit and the Public Debt
Oct. 19, 1934  The Federal Budget and the Public Debt
Feb. 10, 1933  Extraordinary Budgeting of Federal Finances
Dec. 01, 1932  Reduction of Federal Expenditures
Dec. 01, 1930  The National Budget System
Oct. 02, 1930  Federal Revenues and Expenditures
Nov. 02, 1927  The Public Debt and Foreign Loans
Nov. 15, 1926  Rising Cost of Government in the United States
Feb. 05, 1925  Four Years Under the Budget System
Budget Process
Deficit, Federal Debt, and Balanced Budget