Public Budgeting in Context Structure, Law, Reform and Results

Public Budgeting in Context examines budgeting at all levels of U.S. government—federal, state, and local—and in a sample of governments around the world. The book assesses the context of public budgeting in these governments, especially the legal foundations for its practice and how the process and final budgets are impacted by governance structures, laws, various budget actors and different branches of government. The author presents focused attention on the influences on government budgets of the executive, legislative and judicial branches of government, the bureaucracy, the public and the media. In light of worldwide fiscal malaise, especially during and since the Great Recession, this book illustrates the heightened complexity of the budgeting environment that pervades all governments today—industrialized or developing, large or small.

For those who like to dive into the details, the book presents numerous examples of public budgeting as practiced and points to the wealth of data available for analyses of the budgetary context and process, budget shares and results regarding virtually any government of interest. Chapters cover the constitutional and statutory provisions for budgeting in selected governments. Budget and policy agenda setting and executive leadership, legislative budget powers and the influence of the judiciary on modern government budgets are exposed. Budget execution requirements of the bureaucracy, the input of customers, clients and citizens to government budgets, and media influences on public budgets and agencies are highlighted. Budget mechanics—budget types, formats, timelines and reforms—are introduced and compared. Taxes and intergovernmental revenues are considered, with predominant tax choices at every level of government in the United States and those in a select, developing country represented. The book introduces an emerging method for investigating the outcomes of government spending—human rights budget analysis—and includes as an example the assessment of budget reform and results of public health spending in one selected government.

Highlights of Public Budgeting in Context

• Offers a comprehensive text for understanding public budgeting in governments of a variety of contexts and capacities and across different levels
• Written by a noted expert in the field of public budgeting and financial management
• Contains illustrative examples from industrialized and developing countries
• Guides to innumerable datasets with information about governments and their budgets
• Includes a companion website filled with templates for budget and fiscal analysis

Unravel the complex issues of modern public budgeting using this unique presentation of its practice in a variety of governments in the U.S. and a select sample from around the world.

KATHERINE G. WILLOUGHBY, Ph.D, is Professor of Public Management and Policy at the Andrew Young School of Policy Studies at Georgia State University. Dr. Willoughby teaches, writes, and conducts research in the areas of public budgeting, public financial management, public policy analysis and evaluation, strategic management, and organizational decision making. She is a prolific contributor to key scholarly and practitioner journals, including Public Administration Review, Public Performance Management Review, and Public Budgeting & Finance.

Preface xiii

Acknowledgments xvii

About the Author xix

O N E Overview of Modern Public Budgeting 1

What Is a Budget? 3

Macro- and Micro-Budgeting 7

Public and Private Budgeting 8

The Role and Size of Government 10

Modeling the Budgetary Process 13

Budget Principles 20

Conclusion 21

Discussion Questions 22

Notes 22

References 23

TWO Budget Foundations in Selected Countries 25

Developing Versus Industrialized Countries 26

Comparing Budgeting Systems 32

Conclusion 56

Discussion Questions 57

Notes 57

References 61

T H R E E Budget Law and History of the US Federal Government 65

Early Budgeting 66

An Executive Budget Process Is Born 69

Congress Strives for Credibility 73

Budget Balance and Management Improvement 76

Then and Now, Budget Numbers 82

Adherence to Rule of Law 86

Conclusion 87

Discussion Questions 88

Notes 89

References 91

F O U R Budget Foundations in US States 95

The Fiscal Landscape of States: Two Centuries of Growth 96

Legal Foundations for State Budgeting 98

Credit Ratings, GASB Standards, and Professional Guidelines 117

Conclusion 122

Discussion Questions 123

Notes 123

References 126

F I V E Budget Foundations in US Local Governments 129

The Multiplicity and Responsibilities of Local Governments 130

Local Government Powers 134

Local Government Fiscal Stress and Bankruptcy 143

Conclusion 149

Discussion Questions 150

Notes 151

References 152

S I X Executive Leadership and the Budget Agenda 155

Presidential versus Parliamentary Systems 156

Strategic Planning and the Budget Process 158

Public Leadership: Generating a Budget Plan 159

Executive Leadership in Parliamentary Systems 160

US Presidential Leadership and Budgeting 162

Presidential Job Performance 167

State Executive Leadership and Budgeting 169

US Local Leadership 182

Leadership in a Strong Mayor City Government 185

Conclusion 190

Discussion Questions 191

Notes 192

References 193

S E V E N Budget Powers of the Legislative Branch 197

Measuring Legislative Powers in the Budgetary Process 198

Legislative Budgeting in Select Governments 206

Legislative Reform 224

Conclusion 225

Discussion Questions 225

Notes 226

References 228

E I G H T Public Budgeting and the Courts: Judicial Influence on Economies and Budgets 231

The Judiciary and the Economy 232

Courts and Public Policy 233

The Judiciary and the Budget 240

Judges, Courts, and Corruption 245

Conclusion 260

Discussion Questions 261

Notes 261

References 263

N I N E The Bureaucracy, Citizens, the Media, and Public Budgets 267

The Budget-Maximizing Bureaucrat 268

Budget Execution Practices 271

Citizens and Budgets 281

Citizen Participation in US State Budgeting 287

The Media and Public Budgets 290

Conclusion 295

Discussion Questions 295

Notes 296

References 298

T E N Budget Mechanics and Reforms 303

Budget Types 304

Budget Cycles and Timelines 309

Best Practices 315

Budget Reforms 320

Conclusion 335

Discussion Questions 335

Notes 336

References 338

E L E V E N Funding with Taxes and Other Revenues 341

Equity 343

Efficiency 345

Adequacy 347

Transparency 348

Collectability 351

Taxes in the United States and Guatemala 358

Intergovernmental Revenues 366

Conclusion 373

Discussion Questions 373

Notes 374

References 375

TWELVE The Results of Government Spending 379

Human Rights Budget Work 380

Government Presence and Prosperity 384

Government Spending by Function 386

Social Indicators: Quality of Life 386

Country Competitiveness 391

Budget Reform in Italy 399

Health Care in Italy: Changing Budget Orientation 404

Budget Institutions, Reform, and Results 408

Conclusion 410

Discussion Questions 411

Notes 412

References 412

List of Abbreviations and Acronyms 415

Index 421

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