MAKING PUBLIC POLICY| 431the legislative process and no real way to coordinate activity among them. The
appropriations committees tried to be the “guardians of the Treasury,” but it was
diffi cult to keep the spending requests from other committees in line with overall
budgetary expectations because of Congress’s two-step process to approve spend-
ing: the authorizing committee writes the law that authorizes the spending, and
then the appropriations committee approves the level of spending.^6 As a result,
budgetary power shifted from Congress to the president, starting with the Bud-
get and Accounting Act of 1921. Since then presidents have played a central role in
the budget process by submitting their budgets to Congress. The president’s budget
often serves as the starting point for the congressional budget (see “How It Works”).
Today, as evidence that politics is confl ictual, increased partisan polarization
is occurring in Congress over budget making. Diff erences between Democrats’
and Republicans’ views of taxing and spending policy make it diffi cult to pass a
budget on time. Recently, Congress has relied on “continuing resolutions,” which
keep spending at the level of the previous year’s budget, when they cannot agree
on a new budget. Even traditionally noncontroversial aspects of fi scal policy, such
as increasing the debt ceiling to authorize government borrowing, have become
opportunities for partisan politics.
Congress also plays a central role in shaping social policy. Many important
social policies such as Social Security, Medicare, Medicaid, and food stamps,
started out as presidential initiatives. But Congress writes the laws and then
reforms and expands them over the years.
THE PRESIDENT
Presidents know that the public expects them to promote a healthy economy.
Indeed, the state of the economy infl uences the public’s assessment of presidential
performance and also infl uences election outcomes. President Obama focused on
the economy in his fi rst months in offi ce, pushing through a massive stimulus bill;
later, facing high levels of unemployment, Obama also signed legislation aimed at
creating more jobs.
As mentioned in Chapter 10, on the economic front the president cannot accom-
plish much single-handedly: Congress, the Fed, and broader domestic and interna-
tional economic forces all have an impact on the health of the economy. However,
the president has a large advising structure to help formulate economic policy.
The Offi ce of Management and Budget (OMB), the Council of Economic Advisers
(CE A), t he O ffi ce of the United States Trade Representative (USTR), and the
National Economic Council (NEC) all provide important economic advice to
the president.
The OMB, formerly the Bureau of the Budget, solicits spending requests from
all federal agencies, suggests additional cuts, and then coordinates these requests
with presidential priorities. It ultimately puts together the president’s budget,
which is then submitted to Congress. The OMB also oversees government reorga-
nization plans and recommends improvements in departmental operations.
The CEA primarily provides the president with objective data on the state of
the economy and expert advice on economic policy. The CEA is responsible for
creating the Annual Economic Report of the President, which has a wealth of data
on the economy and an overview of the president’s policies. Although presidents
have varied in how closely they work with the CEA or other parts of their economic
team, some prominent CEA members have signifi cantly infl uenced the adminis-
tration’s tax policy and jobs program.
National Economic Council
(NEC) A group of economic advis-
ers created in 1993 to work with the
president to coordinate economic
policy.United States Trade Repre-
sentative (USTR) An agency
founded in 1962 to negotiate with
foreign governments to create trade
agreements, resolve disputes, and
participate in global trade policy
organizations. Treaties negotiated
by the USTR must be ratifi ed by the
Senate.