Comparative Public Budgeting

Lance T. Leloup, George M. Guess

Description

Increasingly, governments must respond to the negative impacts of global economic crises on their revenues to finance needed services, and the collapse of their real industrial and financial-banking sectors. How they respond most effectively is a new study area which demands sharing of lessons between nations on government fiscal policies and performance. Budgeting for and financing of government programs and services vary widely among nations and it is important that we understand the implications of similarities and differences in methods and systems. Only through comparative analysis of public budgeting systems can results be improved in such policy areas as health, education, economic stabilization, and infrastructure development. The current global economic crisis has increased fiscal deficits and the accumulated public debts of most countries. It is especially critical now that lessons from budgeting in particular regional clusters be compared and that policymakers adopt the most relevant and useful ones that are available. In Comparative Public Budgeting, George M. Guess and Lance T. LeLoup examine conditions affecting budget decisions at the national and local levels. They review how nations classify their revenue and expenditure transactions, compare cultural and economic conditions between regions, and examine legal and institutional features that affect public management of budgets. Incorporating the most recent and significant changes in budget policy spanning more than 230 nations including the United States, the Commonwealth countries, and a selected group of European Union members, this book offers a fresh analysis of how cultural, institutional, and political forces determine how countries allocate resources and spend them for programs and policies.
List of Illustrations
Preface

1. Comparative Budgeting

2. Budgeting in the United States

3. Commonwealth Countries

4. Budgeting in Europe and the European Union

5. Central and Eastern Europe and the Former Soviet Union

6. International Budget Problems and Practices: Latin America

7. Budget Reform and Dissemination of Information

8. Conclusion: Dissemination of Budget Lessons and Innovations

Notes
References
Index

Sujets

• Comparative politics
• Public administration
• Globalization
• Political economy
• Central
• National

Informations

• Publié par: State University of New York Press
• Date de parution: 30 septembre 2010
• Nombre de lectures: 0
• EAN13: 9781438433103
• Langue: English

Extrait

COMPARATIVE PUBLIC BUDGETING
GLOBAL PERSPECTIVES ON TAXING AND SPENDING
GEORGE M. GUESS
AND
LANCE T. LELOUP

Published by State University of New York Press, Albany
© 2010 State University of New York
All rights reserved
Printed in the United States of America
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For information, contact State University of New York Press, Albany, NY www.sunypress.edu
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Library of Congress Cataloging-in-Publication Data
Guess, George M.   Comparative public budgeting : global perspectives on taxing and spending / George M. Guess and Lance T. LeLoup.       p. cm.   Includes bibliographical references and index.   ISBN 978-1-4384-3309-7 (hardcover : alk. paper) 1. Budget. 2. Finance, Public.   I. LeLoup, Lance T. II. Title.   HJ2005.G85 2010   352.4'8—dc22                                                                              2010005122
10  9  8  7  6  5  4  3  2  1

D EDICATION
T his book is dedicated to my co-author, Lance T. LeLoup. I learned of Lance shortly after I began teaching public budgeting courses in 1977. In a state of panic, I needed to know quickly about American budgetary systems and politics (Schick and Wildavsky alone wouldn't do it!). A small paperback with a dollar sign on the cover caught my eye at Georgetown University bookstore. That, of course, was Budgetary Politics (first edition, King's Court Press, 1977), and I vowed one day to thank him for saving me from disaster in my first semester of graduate teaching. Like many in our discipline, I got to really know Lance over the decades through participation with him on professional panels and informal chats at conferences. It soon developed that we shared a common interest in comparative public budgeting and institutional politics, especially those of Central and Eastern Europe. Both of us had been faculty at Central European University in Budapest—he in 1998–99 and me in 2004–07. His interest in the fantastic city of Budapest preceded mine as he had been a Fulbright Scholar there in 1995 at Corvinus University. It was during dinner at one conference that we conspired to write a book on comparative public budgeting. He would bring his deep knowledge of American budgetary politics and those of Central Europe, Europe, and the EU. This would mesh nicely with my experience with Latin America, the Former Soviet Union, the Balkans, and Commonwealth countries. Off we went. We worked together from great distances—he from Washington State University in Pullman and me from Budapest and later from here at American University. Through the magic of e-mail and phone, we would work together until the book was out and then have a hearty celebration. It was not to be. In spring of this year, Lance told me about the severity of his cancer, and I knew that there would be no such celebration. Since we had both finished our assigned parts, the project was in that sense at least successful. His wife Pam knows better than I what an effort all this must have been for Lance. I want to thank him for his wry sense of humor and for his refreshingly absurdist commentary in a profession known for its self-importance and sobriety. I am honored to have known and worked with someone of Lance's stature, dedication and warmth. Like many, I will miss him.

I LLUSTRATIONS
TABLES
1.1. Per Capita Gross Domestic Product for Richest and Poorest Countries
1.2. Microbudgeting versus Macrobudgeting
1.3. Models of Constitutional Arrangements and their Cultural Influence
2.1. Major Steps in the Formulation Phase
2.2. Major Steps in the Execution Phase
2.3. Congressional Budget Decisions
2.4. Major Steps in the Congressional Phase
3.1. Projected Fiscal Deficits and Debt 2009
4.1. Distribution of Votes to EU Member States to Determine a Qualified Majority
4.2. Benefit Levels and Duration of Social Programs in Selected EU Nations
4.3. Expenditure Efficiency: Comparing Education Spending to Outcome Measures
5.1. Common vs. Civil Law Countries
5.2. 2009 Projections of Fiscal Deficits as a Percentage of GDP
5.3. Elements of a Successful Capital Programming, Financing, and Implementation System
6.1. 2009 Projections of Fiscal Deficits as a Percentage of GDP
6.2. Attributes of Latin American Political Culture
7.1. Reforms of Budget Process Stages
7.2. Ministry X: Past Line-Item Budget
7.3. Ministry X: New Economic Classification of Expenditures
7.4. Functional Classification of Recurrent Expenditures
8.1. Comparative Budget System Reforms
8.2. Adaptation of Advanced Country Fiscal Management Systems
FIGURES
1.1. Total Tax Revenue as a Percentage of GDP, 2003
1.2. Comparing National Debt 1995, 2004
1.3. Public Social Expenditure as a Percentage of GDP, 2001
2.1. The Total Deficit or Surplus as a Share of GDP, 1970 to 2019
2.2. Debt Held by the Public as a Percentage of GDP
2.3. The Budget Cycle
3.1. Preparing Multiyear Expenditure Estimates
4.1. EU Expenditures by Category (2007)
4.2. EU Sources of Revenue (11996, 2007)
4.3. A Comparison of Budget Deficits and Debt, 2005 (% GDP)
4.4. Subnational Tax Revenues as a Percentage of GDP (2000, 2005)
4.5. Actual and Projected Revenues, Expenditures, and Deficits 2000-2009 (% of GDP)
4.6. Public Debt and Annual Deficit, 1959–2006
4.7. Government Spending by Source, 1959–2006
4.8. A Comparison of Budget Deficits and Debt, 2005 (% GDP)
4.9. A Comparison of Revenue and Expenditure Levels in Eight New Member States (Percent of GDP)
4.10. Actual and Projected Revenues, Expenditures, and Deficits 2000–09 (Percent of GDP)
7.1. Functional Classification of the Budget
7.2. Subfunctions of General Public Services
P REFACE
F acing the multiple challenges of a major global economic contraction and ongoing collapse of both the financial-banking and nonfinancial sectors, government financial policymakers have been called upon as never before to respond effectively. Super-expansionary fiscal policies have been enacted in the United States, Germany, and elsewhere. These include direct spending for infrastructure, social safety net benefits, and asset purchases/loan guarantees of banking and finance institutions. The multiple purposes are to stimulate lending, borrowing, overall macroeconomic demand, and to provide job security. Whether and how well they will work is still an open question. Policymakers are devising strategies and revising them almost by the month in an effort to trial and error their way to success on all fronts. For one of the first times in the history of many economic crises, public sector finance officials can point elsewhere for the causes—to the failures by private firms to apply known creditworthiness standards to mortgages and property loans and to ideological deregulation of fiscal controls. These changed the rules of the game and allowed commonly used innovative financial instruments, such as derivatives and credit swaps, to quickly contaminate the economy. Long-practiced public sector requirements that reveal financial risks and unsustainable conditions were not followed by the private sector. Instead, banking and finance analysts failed to notice or report that the underlying collateral for most of the complex securities were worthless—based as they were on high-risk loans that in many cases never should have been originated. Regardless of the causes, the current capability of governments to respond to this serious crisis depends largely on the degree of their fiscal management prudence during past boom times—their propensity to save funds that can now be invested in expensive stimulus programs. Economic history provides some policy guidance. For most governments, however, the lessons of good public budgeting and financing need to be relearned or acquired from comparative examples in other regions (often from their own region and countries). This book examines the major tools, systems, and practices from five geographic regions or fiscal clusters of the world. It is hoped that our efforts will add to ongoing applied work in comparative budgeting and that it will ultimately stimulate new research methods, budget practices, and fiscal theories.
Both authors would like to thank Mike Rinella and Gary Dunham at SUNY Press for their support on this project. George Guess wishes to acknowledge the substantial research efforts of Mr. Marvin Ward, Assistant Director of the Center for Public Finance Research and doctoral student in public affairs at American University. In addition, he would like to thank Vassia Stoilov, doctoral candidate in public affairs at American University, for her assistance on manuscript preparation. He wishes to thank his stude