In yesterday’s post, I described the way the budget process should run in the Congress, with the twelve appropriations committees in each chamber passing a spending bill, reconciling it with the bill passed by the other chamber if there are differences, and then passing a single reconciled bill that is sent to the president for his signature. All twelve such bills are supposed to be passed before the August recess, to be signed into law by the president to take effect with the new fiscal year starting October 1.

Congress and the White House also have the option of using Supplemental Appropriations. This is meant to provide a way to deal with unexpected major expenditures that could not have been anticipated in the budget process, such as catastrophes like hurricanes and earthquakes. (In the past few years, however, this option has been heavily exploited to fund expenditures that are not emergences, like the never-ending wars in Iraq and Afghanistan and other countries. For example, in 2008 about $200 billion, about 17% of the total discretionary budget, was allocated to the so-called ‘Global War on Terror’ using supplemental appropriations. By not using the regular budget for these expenditures, the government can disguise the true cost of those wars. See this site for what the real costs of the wars are and how they are hidden from us.)

It all sounds very orderly, as one would expect from a government that has had over 200 years to develop a smooth working structure.

But what actually happens? “In 26 of the past 31 years (FY1977-FY2007), Congress and the President did not complete action on a majority of the regular bills by the start of the fiscal year (see Table 2). In eight years, they did not finish any of the bills by the deadline. They completed action on all the bills on schedule only four times: FY1977, FY1989, FY1995, and FY1997.” (My italics)

In the current year as of today, already three months into the fiscal year, the Senate has not voted on a single one of the twelve appropriations and the House has voted on only two of them (Military/Veterans and Transportation/HUD). In an effort to obtain a budget, Congress tried as a last resort to pass all twelve separate appropriations bills by rolling them all into one gigantic $1.2 trillion ‘omnibus’ bill. But that attempt failed on December 16th because the Senate Republicans blocked it.

(Note: The total government expenditure (using the 2008 budget figures) is around $3.0 trillion. Of this, about $1.8 trillion consists of mandatory spending that Congress cannot tinker with (such as Social Security payments, Medicare, Medicaid, interest on the national debt, etc.), leaving the Congress with just $1.2 trillion of so-called discretionary spending to cover all the rest of government. It is the allocation of this money that Congress has control over. The recent tax deal that was signed into law reduced revenue and increased expenses to the tune of $858 billion, about three-quarters of the discretionary budget, and yet it sailed through Congress because it benefited the oligarchy.)

So given that not a single appropriations bill has been passed and the omnibus bill failed too, the country is operating without a budget.

So how is the government functioning? By using the option of ‘continuing resolutions’, which allows the Congress to pass stopgap appropriations that are based on the previous year’s expenditures, plus a few ad hoc changes to meet any contingencies that were not present the previous year. This means that almost all government agencies will be able to continue doing what they did the previous year.

In 2010, the first continuing resolution was passed on September 29, just before the beginning of the new fiscal year, that continued funding until December 3. Then just as that expired, a new continuing resolution was passed on December 4 extending the spending until Saturday, December 18. On Friday night, they passed another continuing resolution that lasted through December 21. Another continuing resolution was passed yesterday that extends this form of temporary funding until March 4, 2011.

So we now have a situation where the Congress will have to start the process of planning the budget for fiscal year 2012 before it has even passed a budget for fiscal year 2011. Is this any way to run the world’s biggest economy, living hand-to-mouth by passing temporary spending authorizations that can last as little as just a few days?

It costs an enormous amount of money (over four billion dollars) to pay for both chambers of Congress. You would think that they would be obliged to complete the most basic task required of them, which is to pass a budget. It is an absolute disgrace that they have not passed a single one of the twelve appropriation bills so far, and that there seems to be no sign of them doing so in the near future. If members of Congress were treated like any other employees, they would have been fired for gross incompetence, instead of being allowed to bloviate over non-essential matters and preen before the TV cameras.