Last week, Senator Mike Braun (R-IN) introduced five bills that aim to promote fiscal transparency and better budgeting. In recent years, federal budget deficits have exploded in size. In 2018, the federal government’s total budget deficit was a still-substantial $780 billion. By 2023, that figure had risen to $1.7 trillion, even after the wind-down of pandemic budget blowouts, and the national debt had increased by over $10.7 trillion.
The centerpiece of the series of bills introduced by Braun is the No Bias in the Baseline Act (S. 4660). This proposal would revise the fiscal distortions built into the Congressional Budget Office’s (CBO) annual baseline. The baseline projects spending and revenues over a ten-year window. CBO’s cost estimates of legislative proposals considered in the House and Senate measure their impacts relative to the dollar amounts in the baseline. As NTUF’s Taxpayers’ Budget Office has pointed out, there are several problems with the baseline due to the rules and assumptions that Congress requires CBO to use.
Some of these distortions include the assumptions that discretionary spending will necessarily grow with inflation and that expiring programs will always be renewed. These assumptions bias the baseline to imply that more spending will be taking place than if Congress made no changes to the law. If the CBO’s methodology for producing the baseline is changed to reflect a more neutral perspective, this may prevent higher spending levels from being locked into the baseline going forward, forcing the executive and legislation branch to exercise fiscal discipline. Rep. Ben Cline (R-VA) also introduced the House’s version of the No Bias in the Baseline Act last week as H.R. 8979, noting that “25 percent of spending in the baseline is just assumed.”
The other four bills that Braun has now set before the Senate build on the recent work of the House Budget Committee. Two of Braun’s bills were passed by the House Budget Committee in January, and the other two in May.
The Fiscal State of the Nation Act (S. 4665) would require the Comptroller General and the head of the Government Accountability Office (GAO) to address a joint hearing on the House and Senate Budget Committees each year and present the findings of GAO’s annual Financial Report of the United States Government. This measure would help lawmakers receive the most current, nonpartisan, and accurate information pertaining to the nation’s fiscal well-being and allow them to make more informed decisions as they work on the federal budget. Senator Jacky Rosen (D-NV) is a cosponsor to the bill, and S. 4665 is the companion to Rep. Blake Moore’s (R-UT) House bill H.R. 6952.
The Debt-to-GDP Transparency and Stabilization Act (S.4659) would require that the President’s annual budget request and also the budget resolutions taken up in Congress include the debt-to-GDP ratio—a key metric used by economists to evaluate the sustainability of a nation’s debt. Like the aforementioned bill, this simple reform would help to highlight the state of the budget after years of fiscally-irresponsible policies. This is companion legislation to H.R. 6957, which was introduced in the House by Rep. Lloyd Smucker (R-PA).
The Improper Payments Transparency Act (S. 4661) would require that the President’s annual budget request include clear and comprehensive data on the improper payments made by federal agencies. According to a press release from Senator Braun’s office, “In FY 2023, federal agencies reported $236 billion in improper payments, but the true scale remains unknown due to insufficient reporting requirements.” This measure would provide lawmakers with insight as to whether or not federal agencies have exercised responsible oversight of their existing budget allotments when deciding on whether or not to increase or decrease appropriations. Senator Rosen (D-NV) has also cosponsored this bill, and Rep. Rudy Yakym (R-IN) introduced the companion bill, H.R. 8342, in the House.
The Strengthening Administrative Pay-As-You-Go (PAYGO) Act (S.4662) would reassert Congress’s constitutional authority to rein in unchecked spending via administrative actions. Regulatory and rulemaking actions from departments and agencies made in the course of implementing laws often result in direct spending beyond what Congress has authorized. The Fiscal Responsibility Act (FRA) of 2023 requires PAYGO offsets for administrative costs that exceed $1 billion over a ten years—or $100 million per year—but this expires at the end of the year. The Strengthening Administrative PAYGO Act will make this requirement permanent.
Under current law, the Director of the Office of Management and Budget (OMB) has broad authority to waive the offset. Braun’s bill would require OMB to provide Congress with detailed reports on any exercise of the PAYGO waiver authority. Additionally, it requires that all such actions be summarized in the President’s budget submission, ensuring greater transparency and accountability. The House companion bill, H.R. 8195, was introduced in the House by Rep. Jack Bergman (R-MI)
Senator Braun and the other members of Congress noted above deserve much praise for their efforts to enhance budgetary transparency and advance fiscally responsible policies. In light of our nation’s record-high debt levels, crafting a sustainable budget has to begin with lawmakers having the right information and budget processes to do so.