For nearly 150 years, we had no formal budget–and we did fine. Now?

Updated
A portrait of George Washington, first President of the United States serving from 1789 to 1797.
A portrait of George Washington, first President of the United States serving from 1789 to 1797.
National Archive/Newsmakers

House Budget Chairman Paul Ryan released his budget proposal for Fiscal Year 2014. His Democratic counterpart in the Senate, Patty Murray, will do the same. And guess what: none of it matters a damn bit. The budget process we have employed since 1974 is a sham, used by the two major political parties against one another while the American people suffer the collateral damage.

Remember the following years: 1789, 1921, and 1974. They are benchmarks when it comes to our nation’s budget process.

Many Americans assume Congress and the president have submitted budgets from the very beginning. Oddly, the opposite is true. From 1789-1849, our government ran a surplus of $70 million, with $1.16 billion in revenue and $1.09 billion in spending. For the next 50 years, we ran a deficit of $991 million, with $14.5 billion in revenue and $15.5 billion in spending. During this  period, we fought for our independence, fought the French, fought the Brits (again), fought Native Americans, fought Mexico, fought our own internal Civil War, and then we fought the Spanish. Oh, and we grew from around 3.5 million people to nearly 75 million during that same period.

Now, guess how many budgets Congress passed during that entire period: none. Guess how many budgets our presidents sent up to Congress in those first 111 years: none. Not a single budget despite our wars, our economic upturns and downturns, our westward expansion, our abolition of slavery.

The Constitution is painstakingly clear on where the spending authority of our country rests. Article I, Section 8, Clause I states: “The Congress shall have the power to lay and collect taxes, duties, imposts and excises, to pay the debts and provide for the common defense and general welfare of the United States.”  Nowhere does it mention the Executive Branch or the president. Our founding fathers went into even more detail in Article I, Section 9, Clause 7: No money shall be drawn from the Treasury, but in consequence of appropriations made by law…” Let’s be clear: this section of the Constitution was put in specifically to keep any U.S. president from becoming the very king we had just declared our independence from.

Now fast forward to 1921. Republican Warren G. Harding is our president and the House of Representatives and the Senate are overwhelmingly controlled by the GOP. On June 10, Harding signed into law the Budget and Accounting Act of 1921 and changed the dynamic between the Executive and Legislative branches of government forever. For the first time, a sitting president was given a major voice in the budget process. In terms of institutional responsibilities, he was now a “player.” Harding and his successors have encroached on Congress’ sole spending and taxing authority to the point where we have nothing but gridlock and eternal campaigning.

So from the turn of the 20th Century to 1975, we fought two World Wars, suffered the Great Depression, squandered our way through the conflicts in Korea and Vietnam and engaged in a Cold War with the Soviet Union. All of this cost hundreds of billions of dollars and we ran unprecedented deficits: $54.6 billion in 1943, $25.2 billion in 1968 to $53.2 billion in 1975. By that time, that imperial presidency our founding fathers feared was rearing its ugly head as Richard Nixon, our 37th president, began making good use of the budget authority given to him back in 1921 by “impounding” money from liberal programs he didn’t like.

But then Nixon became mired in the Watergate scandal. At a time when he was weak and distracted, Congress pounced and passed the Congressional Budget and Impoundment Control Act of 1974. This new framework reigned in the Executive branch’s power over impoundment and also set up rigorous budget standards for the legislative branch. But the budget merely became an internal document with no legal binding authority since the president doesn’t sign it into law. It merely sets up the blueprint for Congress to tax, spend and receive monies. In fact, between 1974-1982, Congress adopted two annual budgets.

The 1998 impeachment of President Bill Clinton ushered in a new era of aggressive partisanship. Budget amendments tripled and both sides were to blame.

Now here we are in 2013 and the House GOP has released a budget the last four years while the Senate Democrats have not. This fact seems to be a generic talking point across cable television of late and frankly, it’s misleading: both parties are guilty of budget neglect and the reason is political.

Today’s budget process is designed to force vulnerable Members of Congress to go on record so their opponents can use those votes against them in their next elections. They use the budget process to destroy their political opponents instead of actually balancing budgets and taking care of their constituents. Senators go down to the well of the upper chamber and vote on amendment after amendment (with virtually no debate) and every one of those amendments is the template for a 30-second ad just waiting to be run on the airwaves in the next election year. It’s a political campaign’s nirvana when we approach budget season each spring.

There are myriad ways to fix the partisanship that envelopes Washington–and one that could go a long way would be to reform the budget process. After all, we did just fine without the current system for nearly 150 years. It’s been downhill ever since.

For nearly 150 years, we had no formal budget--and we did fine. Now?

Updated