March 17, 2020 / Mark Ames

Money, Power, Congress, and the Presidency

Towering at $21.4 trillion, the United States’ gross domestic product (GDP) is so large that it constitutes one-fourth of the world’s total economy. In a world of more than 7 billion people and approximately 200 countries, the U.S. truly is a superpower—and it spends money like a superpower.

In 2019, the federal government spent $4.4 trillion. Meanwhile, the nation’s debt is piling up. By 2050, the Congressional Budget Office (CBO) predicts that the debt will balloon to 180 percent of GDP, soaring to historic levels. Against this backdrop, our nation’s leaders face difficult choices, as they are forced to pit interests against each other. Each decision they make carries great weight. Some people will be saved while the needs of others will go unmet; progress will be made in some areas and other areas will languish. The effects of these decisions will be felt far away from Washington, DC, but they are linked by the same great chain.

As Members of Congress, agency leaders, and the president decide which needs must be met, they construct a vision of the future and a plan to get there. This is most clearly seen in the president’s budget request to Congress, which marks the start of the annual process that funds government agencies and programs, and is followed by the congressional appropriations process.

While many people understand the general contours of these processes, few understand the important details. To better understand how power, money, and influence flow in Washington, let’s explore a side of policymaking that receives little coverage in the media but has tremendous impacts on the lives of everyone associated with the U.S. government.

Constructing the President’s Budget

Before the pageantry that accompanies the unveiling of each presidential budget request to Congress, program managers in each federal agency prepare their own funding requests. This starts about 18 months prior to the federal fiscal year, which begins on October 1. That means that as of this writing, agencies and the White House Office of Management and Budget (OMB) are in the early phases of planning for the 2022 fiscal year. This procedure becomes more complicated during presidential election years because a new president could usher in different spending priorities. Consequently, the first budget proposal of any new administration is generally not as complete as subsequent budget proposals.

To give you an idea of how complicated the process of preparing the yearly budget request is, OMB Circular A-11, which provides guidance to agencies as they prepare their own portions of the request, is more than 1,000 pages long. Each agency follows both the OMB guidance and its own internal procedures for developing their portion of the overall request. This undertaking evaluates programmatic performance, agency missions, visions, strategic plans, and more. As agencies tumble through these budgetary gymnastics, the public has little to no direct input. Of course, agencies are in constant contact with stakeholder organizations, such as AIHA, seeking input on various initiatives and sometimes on strategic plans—but it’s an internal exercise when agencies prepare their budget requests.

After months of preparation, agencies submit their budgets to OMB in the early fall. OMB staff then review each request and may meet with agency officials to better understand their submissions, seeking a closer alignment between what agencies believe they need and what the president prioritizes. This process is generally known as “passback” and culminates in a final budget submission. All agency budgets are rolled up into the president’s budget and submitted to Congress. The president’s budget represents their vision for the country, plotting a path toward a future intended to appeal to Members of Congress and the American public—especially the president’s supporters. Thus, the presidential budget request is both a technical document, based upon intense work within agencies and cowritten by program managers, and a political document, cowritten by those who seek to fulfill the president’s campaign promises.

After receiving the president’s budget, Members of Congress hold many hearings, during which they examine the request in detail. Congress then drafts and approves a budget resolution, which sets overall spending limits. With spending limits in place, Congress moves on to one of the most exhilarating phases of the yearly funding cycle—the appropriations process.

The Emergence of Funding Bills

The U.S. Constitution states that “No money shall be drawn from the Treasury, but in consequence of appropriations made by law.” This means that Congress has primary—but not sole—responsibility for determining how much money is spent by the government and how it’s used.

Funding decisions start in the House and Senate Appropriations Committees. Each committee has 12 subcommittees, for a total of 24 between both chambers. The subcommittees divide up the discretionary spending pie, that is left over after accounting for mandatory spending, such as Medicare and Social Security, hold hearings and develop their own bills. Congress is in the early phases of this now, where a lot of activity happens quickly. Stakeholders such as AIHA meet with policymakers on Capitol Hill and back in their states, and send letters advocating for funding for programs and agencies. Members of Congress get in on the act too, sending their own sign-on letters, known as “Dear Colleagues,” to other offices in support of their favored programs. Certain stakeholder groups often have a hand in drafting and distributing these letters, which are effective tools for legislators to demonstrate a program’s widespread support within Congress to congressional leadership.

Then things get serious. The opportunities to influence the flow of hundreds of thousands, or even millions, of dollars are quickly diminishing. Members of Congress on appropriations subcommittees can propose amendments to a bill during its consideration in the subcommittee, but once a subcommittee approves their bill, it becomes harder to change it; you’ve got to have a sound explanation of whatever massive problem might occur if that funding bill were enacted into law.

After the subcommittee, the full committee considers the bill. Members once again can submit changes to it. The fight over the language used in the report occurs in tandem to this process.

Each appropriations committee prepares a report to accompany each of the 12 annual funding bills. These reports can contain language directing agencies to spend or not spend money on certain activities. While reports aren’t enacted into law, they do send powerful messages to agencies, especially when the same language appears in both the House and Senate reports for a funding bill. This process is behind the scenes but it can be incredibly powerful. Getting controversial language included in a report is rare; getting identical language in both the House and Senate reports is rarer still; so while report language represents both a threat and an opportunity that requires close relationships to be developed and maintained on Capitol Hill, for the most part, it’s less important than amendments.

The appropriations committees in the House and Senate try to approve all their bills in or around May. Traditionally, the House acts first, but Senators can proceed forward with consideration of their own bills alongside the House.

During floor consideration, legislators submit amendments to be debated and possibly voted on. Depending on the rule governing debate that is adopted for the consideration of each bill, some amendments will be permitted, while others will be excluded. Watching the voting on C-SPAN, with classical music playing in the background, you can almost be lulled into believing that this process is calm, or even boring. The reality is that the time leading up to and during floor consideration of spending bills can be frenetic for Hill staff, Members of Congress, and government relations professionals. Competing visions of the future clash as influence is converted into millions of dollars, which fuel the programs and services that support the lives of those living in one of the greatest superpowers on the planet.

After all the votes are done on a bill and it has been passed by one chamber, it goes the other chamber for consideration and possibly more votes. In recent years, Members of Congress have opted to roll the individual bills into one or more larger packages, called a “minibus” or “omnibus” depending on their size. After all this work, the president still has the power to veto the bills and can influence the funding process by issuing veto threats, which are technically called Statements of Administrative Policy, can be read on the White House website. If policymakers can’t reach an agreement before the start of the new fiscal year, they either pass a continuing resolution, which generally level-funds programs and is used to buy more time for debate, or portions of the government temporarily shut down until a new deal is sealed.

All of this plays out year after year. With so much at stake, many careers, both on and off Capitol Hill, have been made by mastering these arcane processes, which impact the lives of everyone associated with the United States government.

Please let me know if you enjoyed this article, and if you have any requests for future explainers.

Mark Ames

Mark Ames is AIHA’s director of Government Relations.


The debt

By 2050, the debt will balloon to 180 percent of GDP, soaring to historic levels. At this rate, the balloon is bound to burst soon thereafter. The consequences will be disastrous to the country as well as to the rest of the world, also. Why not start reducing the debt, progressively?

By Krishna Prasad K N. on April 19, 2020 8:30am
Money, Power, Congress and the Presidency

Great synopsis, Mark. It helps us to better understand when, where and how to try and exert influence.

By Colin J. Brigham on March 27, 2020 9:30am

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