Interbranch Bargaining and Discretionary Appropriations

• In Event: Oversight, Delegation, Bargaining, and Control by the U.S. Congress

Abstract

The federal power of the purse is constitutionally vested in the legislative branch, yet since 1921, Congress has delegated proposal power over the budget to the executive branch. What explains Congress's continuing rationale for delegating proposal power, and under what conditions do legislators revise presidential budget requests? I develop a model of the annual appropriations process in which the President has more information than Congress about an agency’s budgetary needs. Congress has different preferences than the President, but movements away from the presidential budget request entail greater uncertainty about the true state. The main result of the model is that, as policy becomes more complex, Congress is better off delegating agenda setting power, even though budgetary outcomes are increasingly biased toward those preferred by the President. Moreover, the ability of Congress to base its policy decision off the previous year’s appropriation tends to constrain large-scale changes, which may explain why changes to enacted appropriations tend to be incremental in nature. I test the model on an original data set of account-level appropriations from 1960 to 2021 -- the most granular and comprehensive panel of the U.S. discretionary budget yet assembled -- and find support for the theory.

Author

• Ben Hammond, Princeton University