The Budget Making Of The Cbo - 1450 Words

If the CBO really matters, it is due to the fact that honest numbers matter. If its numbers are credible, that is because a culture has developed where honesty is valued and where it does actually make a difference. The CBO was created out of controversy between the executive and legislative branches. There was a lack of fiscal responsibility on the side of congress. Budget making by a committee was then a way to confront resource scarcity face on. This was a way for the congress to also check the executive branch in the budget making process. On February 25, 1975, Alice Rivlin was sworn in as director of CBO. This was the official beginning of the CBO. She was basically a staff of one. The only other employees were the staffers of the†¦show more content†¦One thing all economists do agree on is that income and revenues to spend on resources are scarce. Using particular economic resources for one purpose makes it so that they are not available for another. This may seem like a logical standpoint, but it is one aspect of having scarce resources effecting public policy. Businesses and individuals alike understand the danger o scarce resources and revenues. In terms of individuals, the choice is between consumption and investment whereas for a business it is between capital gains and labor. The public sector has to, for instance, choose between what is done with taxes and spending. Some revenues will need to be raised in order to finance the government, but the real question comes from where those funds come from. The way the government or public sector deals with this is through the type of decision-making that takes place though budgetary processes conducted by the CBO. There is a lot more to all of this than just politics. There is a difference between making trade-offs for uses of funds than for those policies to change decisions. For instance, the government could say that it has two goals in terms of policy. They two policies are providing health ca re for everyone and providing enough defense capacity to be able to fight two wars at the same time. The real costs of these endeavors have to come into perspective. The classic way of looking at this dilemma is the guns versus butter model.