AP Government Budget and Bureaucracy

Any large, complex administrative structure; a hierarchical organization with job specialization and complex rules. By definition, it is not privately owned. All bureaucracies are based on the principles of hierarchy, job specialization, and formal rules. The main purpose of the federal bureaucracy is to carry out the policy decisions of the President and Congress.
Methods of gaining power in a bureaucracy
Three ways by which the bureaucracy can gain power:
– If it becomes too large as to be immune from public
– By placing power over a governmental bureaucracy in
private rather than public hands
– By placing discretionary authority in the hands of a public agency whereas the exercise of that power is not
responsive to the public good
– Three theories that explain the growth of the bureaucracy To consume available resources
– Personnel are promoted up to that point where their
incompetence becomes manifest
– They maximize their total budget
Reasons bureaucracies are criticized
non-elected officials
Stereotypes of bureaucracies
portray it as unresponsive, lethargic, undemocratic, and incompetent.
Quasi-Legislative Powers
Administrative agency exercises its rule-making authority
Quasi-Executive Powers
Carry out rules and regulations
Quasi-Judicial Powers
Issue fines, justice dept.
Granting favors or giving contracts or making appointments to office in return for political support
Pendleton Civil Service Act
Created a system in which federal employees were chosen on the basis of competitive examinations, thus making merit, not patronage, the reason for hiring people to fill federal positions.
Civil Service
Government bureaucracy; non-elected agents (“worker bees”) that work for executive agencies to execute the law; hierarchical organization, job specialization, detailed rules & procedures, administrative discretion. Massive growth since New Deal & WWII (2.5m people = nation’s largest employer)
Merit Principal
the idea that hiring should be based on entrance exams and promotion ratings to produce administration by people with talent and skill
Hatch Act
Created a non-partisan civil service (protecting government workers from the risk of being fired when a new party comes to power). It prohibits civil servants from active participation in partisan politics. Under the terms of the Hatch Act, civil servants are permitted to
vote in primary elections, contribute money to a political party, attend a political rally, and place a bumper sticker on their personal property
Plum Book
A publication that lists the top jobs in the bureaucracy to which the president will appoint people through the patronage system.
Independent Regulatory Commission/Agencies
Federal regulatory agencies that are independent, thus not fully under the power of the president. Ex. Federal Trade Commission, Securities and Exchange Commission.
1. The head of each department is known as the secretary, except for the Justice Department which is headed by the attorney general.

2. Department secretaries are appointed by the President with the approval of the Senate. Cabinet members can be fired by the President.

3. Together, the department secretaries serve as the President’s cabinet. There are 14 cabinet departments.
• The Treasury Department – responsible for monetary policy
• The Department of Defense – responsible for national security
• The State Department – responsible for foreign policy

Government Corporations
Provide a service that can be readily handled by the private sector. These corporations are within the executive branch, and they are under the control of the President. Top officers are appointed by the President with Senate confirmation; all of their employees are public officials. The Postal Service and the Tennessee Valley Authority are examples of government corporations.
Independent Executive Agencies
Are created by Congress and which operates outside the 14 executive departments in the cabinet. Three types of independent agencies: independent executive agencies, independent regulatory commissions, and government corporations. (The Office of Personnel Management, the Peace Corps and the Civil Rights Commission are examples of independent executive agencies which are “supposed” to be free from political influence).
Iron Triangle
Iron Triangle
Iron triangles are composed of bureaucratic agencies, interest groups, and congressional committees. The iron triangle is characterized by mutual dependency, in which each element provides key services, information, or policy for the others.
Issue Network
Relationships among interest groups, congressional committees and subcommittees, and the government agencies that share a common policy concern.
Programs such as unemployment insurance, disaster relief, or disability payments that provide benefits to all eligible citizens. Governmental expenses that are permanent and can only be changed with amendments to laws. Of the $3.5 trillion dollars that the federal government spends, more than $2 trillion is spent on entitlement spending.
Problems: Hard to change and expensive.
Budget Process steps
1. President’s budget (OMB)
2. Congressional Budget Action (CBO)
– Adoption of budget resolution
– Passage of annual appropriation bills
3. Implementation: President signs 13 bills (come out of appropriation committees)
– compromise/agree and end up raising spending
4. Audit & Review
Deficit and Debt
Debt = deficits added together
The Debt Crisis (includes Sequester)
US massive debt problem
Sequester = involves setting a hard cap on the amount of government spending, limiting the size of the Federal budget
Congressional Budget and Impoundment Control Act of 1974
Modified the role of Congress in the federal budgetary process. It created standing budget committees in both the House and the Senate, established the Congressional Budget Office, and moved the beginning of the fiscal year from July 1 to October 1.
Congressional Budget Office
Advises Congress on the probable consequences of its decisions, forecasts revenues, and is a counterweight to the president’s Office of Management and Budget.
Office of Management and Budget
EOP agency that helps the President prepare annual budget proposal and evaluates budget priorities and effectiveness of federal agencies (oversight)
Budget Resolution
A resolution binding Congress to a total expenditure level, supposedly the bottom line of all federal spending for all programs.
Congressional Control of Bureaucracy
Authorization and Appropriation and Oversight
Executive Control of Bureaucracy
presidents try to appoint best possible people; president can reorganize bureaucracy and can make changes in annual budget requests from agencies and ignore legislative initiatives; issue executive orders
How does the bureaucracy wield its power?
crises (natural, foreign, economic)
citizen demands
Discuss the common reasons of why bureaucracies are so powerful.
Discretionary authority
Expertise – merit (Pendleton Act)
Ability to control policy (iron triangle)
Discuss the growth and character of regulation in America (why bureaucracies have become so important)
We have become dependent on programs like Social security
How is the bureaucracy controlled?
Executive – appointments, fire bureaucrats, OMB
Legislative – legislation, oversight, appropriation/authorization
Judicial – judicial review
Explain why the budget process is a classic example of the definition of politics (who gets what, when and how)
To budget = fight over money
who = actors
what = budget $
how = political process
budget = ultimate example of politics
Explain why much of the government’s expenditures are considered “uncontrollable.”
money going out > money coming in
Predict the impact of the current budget crisis on federal policies.
Spending way more on programs than taxes to pay the program they will probably need reevaluate programs or raise the eligible age for Social Security
Government spending. Major areas of federal spending are social services and national defense.
The financial resources of the government. The individual income tax and social security tax are two major sources of revenue.
tax expenditures
revenue losses that result from special exemptions, exclusions, or deductions allowed by federal tax law.
What limits the bureaucracy
1. Spending appropriations
2. Pendleton Act – merit based
3. Oversight
How does the President control the bureaucracy
Fire bureaucrats
Office of Management and Budget (funds bureaucracy)
How does Congress control the bureaucracy
budget request
blueprint for next year
Omnibus bill
A single document that is accepted in a single vote by a legislature but contains amendments to a number of other laws or even many entirely new laws.
Policy is implemented through the activities of public bureaucracies and the expenditure of public funds.

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