United States Senate Committee on the Budget

Committee information

• Date created: 1974
• Members: Twenty-one members in the 119th Congress (2025-2027)
• Subcommittees: None

Role

The United States Senate Committee on the Budget is a panel of senators that work to oversee the federal budget. The committee is responsible for drafting federal budget plans for Senate consideration and approval. It also holds jurisdiction over policies that directly impact the budget and federal spending.

According to the US Constitution, Congress is responsible for laws concerning the federal government’s finances. The Senate as a whole, along with the House of Representatives, is responsible for passing or changing laws that impact those finances. Because the Senate faces a wide variety of issues, it uses committees to help assign particular issues to members who are most knowledgeable about them. Committees have been in use in the United States since the very first Congress in 1789. As with Congress as a whole, committees meet regularly to discuss issues and propose legislation to address any needs. If proposals are approved by a committee, then the committee presents them to the full House or Senate for approval.

The Senate Committee on the Budget is a standing Senate committee. Standing committees are permanent fixtures of Congress. They focus on issues that, as far as anyone can predict, will always be a concern. The federal budget, for instance, is an ongoing concern of the United States, whether the nation is prospering, struggling, or at war. In contrast, some committees are created to resolve a single, short-term issue. These are called select committees. Once they have completed their task, the committees may be dissolved or merged with another committee. In 1919, a select committee was created that was also named the Senate Committee on the Budget. The committee’s work led to the passage of a significant budget-based policy, and government officials of the time believed that more oversight of the budget process would not be necessary.

As a Senate committee, the Budget Committee is made up exclusively of senators. Its membership changes with each version of Congress. The number of Republicans and Democrats on the committee matches the ratio of each party’s membership in the overall Senate. The budget committee is one of sixteen standing Senate committees. The House of Representatives has its own Budget Committee, and although the two committees work closely at times, they remain separate.

House committees may have up to five subcommittees, which help its members focus on even more specific issues. Senate committees do not have limits on the number of subcommittees. The Budget Committee is one of the few Senate committees that lacks subcommittees. Most budget issues are intertwined, involving multiple agencies and branches of government. This makes it difficult to give a subcommittee jurisdiction over one agency and not others.

History

In the years after the United States achieved independence, it began to construct a new government. In 1789, the nation established the Treasury Department which helped manage the country’s wealth and spending. During the very first presidential administration, the federal government borrowed from and lent to individual states and citizens, and willingly took on debt to improve the economy in the long run. Both of these concepts remained important aspects of the federal budget.

The US Constitution specifically granted Congress control over the nation’s finances, but it did not include any processes or guidelines for Congress to enact that control. Throughout the nineteenth century, legislation regarding budget management was reactive, with Congress proposing policies to address problems once they arose. By the early twentieth century, calls began to multiply for stricter regulation of federal spending. The Senate created the original Committee on the Budget in 1919. Unlike the modern version, this was a select committee, and it was dissolved the following year. However, it led to lasting legal actions that changed the structure of the federal budget.

In 1921, President Warren G. Harding signed the Budget and Accounting Act, which organized the federal budget into something closely resembling the modern version. It required that the president submit a budget to Congress for each fiscal year. It also created two government organizations to help evaluate the budget. The Office of Management and Budget is a part of the executive branch, and helps the president assemble each year’s budget. The Government Accountability Office is a non-partisan congressional agency that reviews the budget and makes sure it is being managed responsibly.

In the late 1960s, Congress began seeking a way to modify its role in the budget process. Several members of Congress believed that the executive branch was taking advantage of certain policies to exercise control over the budget that it should not have. For instance, Congress would regularly decide that a specific amount of funding would go toward a particular project, such as disaster relief. This was called appropriation. However, the executive branch could impound this money, meaning they declined to spend it on what it was appropriated for. While this had been a power of the executive branch for centuries, there were many in Congress that believed it was being used in more recent years as a way for the president to hinder projects that Congress approved but the president disagreed with.

After several failed proposals, Congress established the Congressional Joint Study Committee in Budget Control in 1972. This committee investigated how the federal government created and used its budget, reviewing the process to see if changes needed to be made. The committee reported its findings the following year, and determined that standing committees in both the Senate and House specifically designed to oversee the federal budget should be created. One year later, the Congressional Budget and Impoundment Control Act of 1974 was passed, creating the Senate Committee on the Budget.

Jurisdiction & Legislation

The Budget Committee is primarily responsible for developing the Senate’s plan for the federal budget each year. It can also propose reconciliations—fast-tracked passage of specific budget and spending measures—which have less strict requirements for passing than other laws. The committee has often introduced these to curb excessive government spending or to get quick funding for an agency in need. Finally, the committee ensures that other congressional committees are following the agreed-upon budget.

The Federal Budget

Producing a federal budget is a multi-step process with many factors to consider. First, the president goes through the requests for funding that have been submitted and works with the Office of Management and Budget to determine how the budget could be best spent. They prepare a budget request, which is sent to Congress. The Budget Committee receives the president’s request. It is simply a method for the executive branch to communicate its priorities to Congress, and the committee is not obligated to follow it.

When drafting the federal budget, the committee has to consider different types of spending. Most of its decisions revolve around discretionary spending. These are funds given to various government agencies or departments, such as the Environmental Protection Agency. Each year, the committee must determine how each agency’s funding should change.

A substantial part of government spending is known as mandatory, or direct spending. This refers to government programs that are designed to run on a permanent basis and aid American citizens. These include Social Security, Medicare, and Medicaid. Most of these programs provide payments or benefits to citizens if they are eligible. For instance, a citizen must reach a particular age to qualify for Social Security or Medicare, and a citizen’s income must fall below a certain amount to qualify for Medicaid. The committee cannot change the eligibility requirements, or the amounts that eligible citizens receive from these programs. Eligibility requirements and benefits can be changed, but they are outside the committee’s jurisdiction.

What the committee can do is keep track of the amount of eligible citizens, and plan discretionary spending accordingly. For instance, advancements in science and technology mean more recent generations are living longer than previous ones, so the amount of people that qualify for Social Security and Medicare is higher than in the twentieth century. The committee can anticipate that mandatory spending will increase, and reduce discretionary spending to compensate.

The government brings in money to offset some of this spending, and this income must also be factored into the budget. Taxes are the government’s primary source of income, and it collects them from citizens, as well as from the sale of certain goods and services. The government can adjust tax rates each year, and the Budget Committee can recommend increasing or decreasing taxes, but that ultimately falls outside of the committee’s jurisdiction.

If the government brings in the same amount of money that it spends in a year, then it is running a balanced budget. If it makes more money than it spends, it is operating at a surplus. If it spends more than it makes, it is operating at a deficit. Since the formation of the Budget Committee, nearly every annual budget has resulted in a deficit. The only exceptions were 1998-2001. If the government operates at a deficit, it must borrow money to make up the difference. The total amount that it owes for doing this is called the national debt.

Legislation

Major legislation that the committee was involved with includes the Gramm-Rudman-Hollings Acts of 1985 and 1987. These called for deficit reduction over the course of six years. However, this was not effective in practice, and the Budget Enforcement Act of 1990 eliminated it. This act tried a different approach to controlling deficits: preventing the budget from exceeding certain amounts of discretionary spending, and reducing spending to match a reduction in revenue. In 2010, the Statutory Pay-As-You-Go Act was another attempt to control deficits. It banned any legislation that resulted in deficit increases.

The national debts and growing deficits became an increasingly pressing concern to the American people in the early twenty-first century. The committee has regularly been part of the process of raising the debt ceiling, which allows the federal government to accumulate even more debt without legal consequences. It has been raised dozens of times, but grew more controversial during and after the financial crisis of the early twenty-first century.

The mere existence of the national debt is not necessarily a concern, nor is the fact that it has persisted for years. The ability to borrow money allows the government to fund projects that benefit generations of Americans. A significant portion of the debt is held by the American people, in the form of bonds that they purchase. The government makes use of the money in the short term, and the investor can collect the bond with interest later. This system is helpful to the economy. While committee members disagree on the best options for reducing debt, common suggestions are raising taxes and cutting government-funded programs. In order to eliminate debt entirely, one or more of these options would need to be carried out to a drastic degree that would likely impact many Americans. The committee is not expected to eliminate national debt entirely, but to keep it at a sustainable level.

In November 2018, the committee questioned the Federal Emergency Management Administration (FEMA) on its use of funds for relief efforts in Puerto Rico following Hurricane Maria. The committee expressed concern that the majority of funds intended for aid went to overhead and markup costs for contractors that FEMA hired. The committee called for more accountability of FEMA’s spending.

In December 2018, the committee requested information from US Customs and Border Protection. It had a hiring contract intended to gain 7,500 Border Patrol officials over five years. The committee found that after ten months, only two hires had been made, and it sought an explanation for how the process had gotten so far off pace. In the 118th Congress (2023-2024), the committee held forty-three hearings, with many focusing on the impacts of climate change and inflation. Republican Senator from South Carolina Lindsey Graham became chairman of the committee in January 2025.

Bibliography

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