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July 5, 2001
 

Honorable Jim Nussle
Chairman
Committee on the Budget
U.S. House of Representatives
Washington, DC 20515

Dear Mr. Chairman:

At the hearing on June 27, I mentioned the need for a new budget concepts commission. Enclosed is a list of potential topics for a new commission. It is not intended to be a comprehensive list of topics, but it gives you some idea of the kinds of fundamental conceptual issues that should be addressed.

I would be happy to work with you to draft legislation to establish a new budget concepts commission.

Sincerely,

Dan L. Crippen
 

Enclosure

Identical letter sent to Honorable John M. Spratt, Jr.
 

 
Potential Topics For A New Budget Concepts Commission
  1. Budget Coverage: What should be included?

    1. Is part ownership by government sufficient to make an entity Federal and to include it in the budget? (Example: mixed public/private ownership of military housing.)

    2. Is Federal control of an entity--including control exercised through Federal regulations--sufficient to cause it to be included in the budget? (Examples: some kinds of personal retirement accounts and agricultural marketing organizations).

    3. Are privately-owned assets under long-term leases to the Federal government effectively purchased by the government during the lease period?

    4. Should there be an "off-budget" section of the budget?

    5. Spending vs Receipts: Where do we draw the line?

      1. Do the total costs of refundable tax credits belong on the spending side of the budget?

      2. Should Federal Reserve earnings be reported as receipts or offsetting collections (negative spending) in the net interest portion of the budget?

      3. What is a "user fee" and under what circumstances is it properly an offset to spending or a governmental receipt?

      4. Trust Funds: What uses do they have?

        1. Do trust fund balances provide misleading information? Do they add clarity or confusion to the budget process?

        2. Do we need nearly 200 trust funds?

        3. Is earmarking effective?

        4. Are there better ways than trust fund accounting to identify long-term liabilities? Should focus be shifted away from trust fund "solvency"?

        5. Accrual Budgetary Accounting: Should it be applied more widely?

          1. Should it be adopted for


            1. Federal Retirement?
            2. Federal insurance?
            3. Social Security and other entitlements?

            4. Are off-budget accounts suitable for capturing accruals in the budget?

            5. Federal Credit Programs: Should the 1990 Credit Reform Act be modified?

              1. Should administrative costs be included in the calculation of credit subsidies?

              2. Should subsidy costs include a charge for the cost of risk?

              3. How should reestimates of subsidy costs be financed? (Permanent and indefinite authority or through some alternative?)

              4. Special Cases: What is the appropriate budgetary treatment of:

                1. Purchases and sales of financial assets, including equities, bonds, and foreign currencies?

                2. Emergency spending?

                3. The cost of holding fixed assets (cost of capital)?

                4. Sales of physical assets?

                5. Seigniorage on coins and currency?

                6. Policy changes with strong but indirect feedback effects on revenues and other aggregates?

                7. Policies that are one-sided bets on economic events (probabilistic scoring)?

                8. Quota subscriptions and the cost of participating in the IMF?