Trillions: A Primer on the U.S. Debt Ceiling, Federal Spending, Taxes, and Fiscal Law

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Trillions: A Primer on the Debt Ceiling, Federal Spending, Taxes, and Fiscal Law, is a concise treatise explaining federal spending and taxes with easy-to-use explanations of the budget, authorization, appropriations, and tax processes. This book also includes to the point explanations of two timely issues with far-reaching implications: recurrent fiscal crises over raising the debt limit and the recent legal challenge to the Consumer Financial Protection Bureau’s (CFPB) funding mechanism.

This primer provides a distilled overview of federal spending and taxes, and provides an up to date, plain English explanation of the process that governs the federal budget, through appropriations; outside the appropriations process through entitlement and other permanent laws; the growing portion required to service the debt; and the trillions in revenues raised through individual, payroll, corporate, and other taxes and fees.

This book is relevant for Members of Congress and staff, federal agencies, attorneys, advocates, professors and students, the national news and business media, the business community and trade associations, nonprofits, and the curious public. Its wide-ranging contents cover, among other topics:

•  A capsule summary of U.S. spending, taxes, and major programs.
•  A clear and concise explanation of the debt ceiling and why blocking an increase in the debt limit does not reduce U.S. debt but risks global economic chaos.
•  Congress’ constitutional authority over appropriations and the impending Supreme Court review of the constitutionality of the Consumer Financial Protection Bureau’s funding mechanism, with potentially far-reaching effects on the financial sector.
•  The 3-tier legislative process: (i) authorization, (ii) appropriations & revenues, and (iii) the congressional budget process.
•  The crucial distinction in federal budgeting between “discretionary spending” provided through annual appropriations, and “direct (mandatory) spending” controlled outside the appropriation process through permanent law.
•  The 1974 Budget Act’s establishment of the budget resolution—an internal congressional framework for discretionary spending, direct spending, and revenues enforced through parliamentary points of order.
•  The “budget reconciliation” process, which enables filibuster-proof multi-committee legislative packages to change entitlement and tax laws through a fast-track process.
•  The Senate’s “Byrd Rule” and how it reined in the scope of budget reconciliation and limits the duration of tax cuts.
•  “Budget sequestration,” which enables automatic spending cuts implemented by the Office of Management and Budget (OMB), first to enforce deficit caps, later to enforce discretionary spending caps and the pay-as-you-go (PAYGO) deficit-neutrality requirement, and currently to implement more than $25 billion per year in automatic direct spending cuts through 2031.
•  The operation of discretionary spending caps, established in 1990 and continued through 2002, revived in 2011, expired in 2021, and under consideration again in 2023.
•  The Pay-As-You-Go (PAYGO) requirement for deficit neutrality in new direct spending and tax cuts: established in 1990 and expired in 2002, permanently reenacted in 2010 but evaded every year since then through various escape valves.
•  Budget controls that remain after expiration of the Budget Control Act in 2021, including limitations on discretionary and direct spending, tax cuts, and deficits.
•  Strict earmark disclosure requirements that remain in effect during the revival of congressional earmarks.
•  The unique highway funding process—a hybrid of direct spending and appropriations control.
•  Federal credit reforms which control direct loans and loan guarantees by requiring up-front appropriations for subsidy costs.
•  The federal unified budget, which combines operating and capital expenditures, but excludes Social Security and the U.S. Postal Service.
•  Budget treatment of government-sponsored enterprises (GSEs) to advance the housing, agriculture, and rural development sectors.
•  The Impoundment Control Act (ICA) which governs presidential deferrals and proposed rescissions and the recent violation of the ICA by the Trump Administration’s withholding of Ukraine security assistance in the summer of 2019.
•  A thorough glossary explaining in plain English commonly used budget terms.

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