Budget Project for 2019 Fiscal Year

Part I - Budget Project

Federal spending is classified into two major categories i.e. mandatory spending and discretionary spending. During budget preparation, different appropriations are made for mandatory and discretionary spending. In the United States, the federal budget document is delivered well in advance of the creation of the actual federal budget that takes place many months later during the approval stage of the budget process in which Congress is directly involved. The budget document contains appropriations for mandatory and discretionary spending. In addition, the document includes a budget message by the President, which are narrative in nature and reflect the specific values inherent within society and political preferences at a given time.

Budget Message

For the fiscal year 2019, President Trump delivered a budget message in February of 2018, which outlines the political preferences and societal values underpinning the budget at the time. The budget message focused on affecting the upcoming outlays for fiscal year 2019 and was designed in a manner that reflected political preferences and values. As part of articulating the preferred spending focus, President Trump’s budget message incorporated some key conceptual ideas. One of the conceptual ideas in President Trump’s budget message was lowering the national debt. Lowering the national debt was regarded as a crucial component of the budget for fiscal year 2019 since the country is facing the highest level of debt since the aftermath of World War II (Office of Management and Budget, 2019). Therefore, lessening this debt was considered critical in creating a sustainable fiscal path for current and future generations of Americans.

Secondly, a stronger and healthier American economy is a major conceptual idea in the budget message. Promoting economic growth is viewed as an essential factor in the achievement of the American dream. As millions of Americans strive to achieve their dreams and have a better future, promoting economic growth and opportunity is considered essential in creating a suitable environment for the American people to realize their dreams. The other conceptual idea in this budget message is the safety and security of the American people. This entailed rebuilding and modernizing the military as well as adjusting national security strategy. Recovery of the job market is the other conceptual idea in the budget message as it reflected the priority of the Trump Administration to lessen unemployment rates. This idea was incorporated into the budget message since millions of Americans have been denied the independence and dignity that comes through the opportunity to work. The fifth conceptual idea is enhancing the quality of life for all hardworking Americans, which is seen as the foundation for Americans to fulfill their potential and realize their dreams.

These conceptual ideas from the budget message were constructed to reflect Trump Administration’s political preferences and values. Lowering national debt was a major concept in the budget message as it reflected President Trump’s new fight against wasteful spending. During the 2016 presidential campaign, Trump promised to balance the federal budget and stop wasteful spending (Edwards, 2016). He believes that there are some duplicative programs in the federal agencies and misaligned incentives that continue to threaten the future of Americans. As part of fulfilling his campaign pledge and demonstrating a commitment to cut wasteful spending, President Trump included lowering national debt as a major conceptual idea in his budget message. The issue of promoting economic growth was also constructed to reflect the Administration’s commitment to ensuring a steady rate of 3% long-term economic growth. A reduction in national debt, lessening wasteful spending, and implementing massive tax cuts and reforms reflected the Administration’s focus on steering the economy in the right direction.

The safety and security of the American people reflected the Administration’s efforts in modernizing the military and adjusting the national security strategy to confront new political, military, and economic adversaries. This was a reflection of President Trump’s foreign policy goals and initiatives, particularly the Middle East policy. The Administration sought to influence increased expenditure on national security as the President seemingly declared war on the Middle East (Mischke, 2017). Moreover, this idea reflected President Trump’s efforts to build the wall across the US-Mexico border. Recovery of the job market reflected the Administration’s priorities in creating millions of jobs as a means of promoting economic growth and cushioning the nation from recession. On the other hand, enhancing the quality of life of hardworking Americans reflected the Administration’s focus on creating millions of jobs and promoting recovery of the job market.

Government Entity in the Budget Document

One of the government entities discussed at length in this budget document is the Department of Defense. This agency provides the military forces necessary to prevent war and safeguard the security and safety of the United States (Office of Management and Budget, 2019). For the fiscal year 2019, President Trump’s administration sought to rebuild and modernize the military to enhance its capabilities in deterring adversaries in order to preserve peace. In addition, the President prioritized more investments in the military to protect America and the homeland. This involved focusing on the creation of a multi-layered missile defense system to protect the nation against missile attacks. In this regard, the major goals for the agency included expansion of the military’s competitive space, creating a more lethal force, ensuring readiness of the armed forces, modernizing the nuclear deterrent, and investing in military hardware. Additional goals for this federal agency include promoting stability and security in South Asia, preventing the resurgence of terrorist groups like al Qaeda and ISIS, enhancing missile defenses, and sustaining the defense industrial base.

To achieve these goals and recommended actions, the budget requested $686 billion for the Department of Defense. The amount was a 13% or $80 billion increase from the enacted levels for fiscal year 2017. In addition, the amount included $597 billion for the base budget and $89 billion for Overseas Contingency Operations (Office of Management and Budget, 2019). To enhance the department’s capability to compete, deter and win, more than $6.3 billion was requested for its European Deterrence Initiative (EDI). The budget also requested over $70 million in extra resources to improve surface fleet equipment and training, $24 billion for modernization of nuclear deterrent efforts, and over $84 billion for research and engineering to maintain technical superiority. In addition, more than $8 billion was requested to improve cybersecurity capabilities.

Total Discretionary Budget Expenditures for Fiscal Year 2019

Based on actual budgeting data presented in the historical tables, the total discretionary budget expenditures for fiscal year 2019 was more than $1.337 trillion. These expenditures not only reflected President Trump’s spending priorities, but occurred in different public policy areas as shown in the budget message. The top five public policy areas in expenditures are defense, education, transport, Veterans benefits and services, and health. Defense accounted for a significant portion of discretionary spending at more than $676 billion followed by education, training, employment with more than $94 billion. Transport accounted for more than $94 billion discretionary spending followed by Veterans benefits and services and health at more than $85 billion and $66 billion respectively (Office of Management and Budget, 2020).

Total Mandatory Budget Expenditures for Fiscal Year 2019

As shown in the actual budget data presented in the historical tables, the total mandatory budget expenditures for fiscal year 2019 was over $3.110 trillion. These mandatory expenditures were spread in different public policy areas and related programs. As it relates to 2019 mandatory spending, the top five public policy areas in experiences are social security, Medicare, health, income security, and Veterans benefits and services. Social security accounted for more than $1.038 trillion of mandatory spending followed by Medicare at over $643 billion. Health, income security, and Veterans benefits and services followed at more than $518 billion, over $442 billion, and over $114 billion respectively (Office of Management and Budget, 2020).

Alignment with the President’s Budget Message

The actual budget outlays for fiscal year 2019 matchup with the issues identified in President Trump’s budget message. As evident in the budget message, the top spending priority for the Trump Administration is the Department of Defense. The safety and security of the American people is the top priority of this administration as shown in the budget message (Office of Management and Budget, 2019). This is reflected in the high investments in the Department of Defense in discretionary spending. The other top discretionary expenditures reflect the President’s spending priorities shown in the budget message and in actual outlays for discretionary and mandatory spending (Congressional Budget Office, 2019).

In addition, the actual budget outlays for fiscal year 2019, reflect the information discussed in this semester regarding general guidelines for break-down of the federal annual budget. The course and these outlays show that mandatory spending accounts for a huge portion of federal annual budgets compared to discretionary spending (Lee, Johnson & Joyce, 2013). Additionally, social security is usually the top spending priority for mandatory expenditures.

Part II – Relevance of Course Materials

Selection #1 – Chapter 9-10 Lecture Notes

One of the course materials covered in this semester that is relevant to the information presented in the aforementioned budget documents in Part I is the written lectures of Chapter 9-10 of Public budgeting systems by Lee, Johnson & Joyce (2019). These chapters basically highlight the role of Congress in the U.S. Federal System in relation to the budgeting process. In addition, the chapters discuss relevant theories applicable in the process of public budgeting, particularly Public Choice Theory. Based on this theory, individuals involved in different government processes are mainly concerned with promoting their own economic self-interests via political and administrative processes (Cropf, 2008). One of the administrative processes in which these individuals advance their interests and wishes is the public budgeting process. In addition, different stakeholders participate in these political and administrative processes at different points of contact.

In relation to the budget documents in Part I, the course material relates to the actual public budgeting process in terms of the roles of the different stakeholders in this administrative process. With respect to the Public Choice Theory discussed in these chapters, the President and his administration seek to influence upcoming outlays of federal budgets based on their own self-interests. For example, President Trump’s administration sought to influence upcoming outlays for discretionary spending on the Department of Defense based on their own self-interests based on his prioritization of the safety and security of the American people. Moreover, President Trump’s budget message and spending priorities reflected his ambitions to achieve some of the pledges he made during campaigns such as building a wall on the U.S.-Mexico border. The self-interests of stakeholders in administrative processes influence budget decisions/process.

Selection #2 – Budget Preparation Stage Lecture Notes

The second relevant course material is the Budget Preparation Stage Lecture Notes, which provide comprehensive information regarding the public budgeting process. As one of the initial stages of the budget cycle, the budget preparation stage is characterized by many aspects that influence decision-making. This stage is characterized by a multitude of official actors working at various points of contact in a highly politicized phase. These stakeholders work to create budget documents that are ultimately sent to Congress during the approval stage. The budget preparation phase is also an amalgamation of many values intrinsic within fiscal reform movements. Some of these values include efficiency, equality, and effectiveness through which mutually agreed-upon adjustments from the previous year’s annual budget are implemented.

This course material is relevant to the budget documents presented in the budget project in two ways. First, as shown in the course material, these budget documents demonstrate the complex and multifaceted nature of budget preparation. While the President issues a budget message seeking to influence upcoming outlays for the fiscal year, government agencies prepare their own budget statements stipulating their goals, priorities, and spending needs for the year. The President’s spending priorities are shaped by these budget requests from government agencies as well as his own interests. The interests of these different stakeholders play a major role in how the budget preparation phase is carried out as evident in the course material and the budget documents. Secondly, this course material is relevant to the budget documents in terms of the inherent values underlying the budget preparation phase. For example, President Trump’s focus on lessening national debt through cutting wasteful spending is an example of how the budget preparation phase is influenced by the value of effectiveness. In this regard, budgeting is carried out in a manner that ensures the government performs services in a cost-effective way.

Selection #3 – Public budgeting systems by Lee, Johnson & Joyce

One of the core course materials is Public budgeting systems, 9th edition by Lee, Johnson & Joyce (2013). The book provides significant insights into the process of public budgeting across its various stages and the involvement of different stakeholders. It highlights the diverse, complex, and multifaceted nature of public budgeting and issues like revenue and expenditure. The book contains various segments that address different issues relating to the public budgeting process. Some of the concepts discussed in the book that are relevant to the budget documents presented in Part I include mandatory and discretionary spending, the budget cycle, and the role of different stakeholders in the public budgeting process. By discussing these concepts, the book provides extensive information that helps enhance understanding of public budgeting. Therefore, it relates to the budget documents in different ways.

One of the ways in which this book is relevant to the budget documents in Part I is in terms of mandatory and discretionary spending. As shown in the book and in these budget documents, federal spending is classified into two major categories i.e. mandatory and discretionary spending. Discretionary expenditures are provided through yearly appropriation processes whereas mandatory expenditures are provided for through permanent legislation (Lee, Johnson & Joyce, 2013). These budget documents show the difference between these two main types of federal spending and how mandatory spending accounts for a significant percentage of federal expenditures. For example, in the fiscal year 2019, mandatory spending was over $3.110 trillion while discretionary spending was more than $1.337 trillion. Secondly, the book is also applicable to the budget document in terms of the role of different stakeholders in the process. As shown in the budget documents in Part I, different stakeholders are involved in the budgeting process at different stages of the budget cycle.

Selection #4 – Fiscal Administration book by John L. Mikesell

The other vital course material that is applicable and relevant to the budget documents presented in Part I is John L. Mikesell’s book Fiscal administration: Analysis and applications for the public sector, 9th ed. It provides an extensive discussion on how public budgets operate using examples from the U.S. federal budgeting process. In addition, the book provides readers with the opportunity to crunch the numbers of actual data from federal budgets. Through the use of actual U.S. federal budgets, the book provides a breakdown of public budgeting and enhances understanding on how policymakers allocate money. Therefore, it is an important resource or course material for understanding how federal finance and budgeting works.

One of the insights obtained from the course that is relevant to the budget documents is performance budgeting. This budget reform initiative is based on the idea that governmental actions should be carried out with the notion of efficiency. Therefore, each of the activities performed by governmental agencies is measured to determine cost-effectiveness. This implies that resources are linked with outputs in order to institutionalize government accountability (Mikesell, 1999). The budget documents reflect performance budgeting on the premise that spending priorities are determined by what needs to be accomplished by the administrative unit and the required resources. As evident in President Trump’s budget message, the spending priorities were based on what his administration is planning to accomplish and the required resources to do so for each of the relevant federal agencies. This in turn becomes the premise for determining governmental cost-effectiveness and efficiency in resource utilization. This reflects the deliberative democracy in the United States as cost-effectiveness serves as the premise for justifications by policymakers on public budget decisions. Citizens institutionalize government accountability by ensuring that financial resources are spent in a cost-effective manner.