Executive budget

The executive budget is the budget for the executive branch of the United States government. It was established as one of the reforms during the Progressive Era and became a federal policy in 1921 under the Woodrow Wilson Administration. The process of creating the executive budget consists of three phases. The first stage is the development of the president's budget. In this stage, the president submits a comprehensive budget to the United States Congress that covers the full range of federal activities. Next, the budget proposal is edited and revised by Congress. Last, the budget is finalized and executed. It is then given a budget bill from the legislature. The legislature composes the budget bill while an executive agency implements the bill by choosing which projects to take on within the limitations imposed.

One of the reforms of the Progressive Era in the United States was the executive budget system which had its first application for municipal government. The federal government conducted an important study of the executive budget system during the administration of President William Howard Taft (See Sec. VI: The Taft Commission's Federal Budget Study, pp. 26–31). The executive budget system was adapted from the longstanding British parliamentary practice that forbade the House of Commons to increase requests for supply (appropriations) from the governing ministry (prime minister and cabinet) without the approval of the responsible government minister (cabinet member. )(See Sec. VI: Taft)

It became federal policy in 1921 based on actions of the Wilson Administration that were enacted during the administration of Warren G. Harding.

The executive budget process consists of three main phases: development of the president's budget, interaction with congress, and execution of the budget.

The legal framework established by the Budget and Accounting Act of 1921 requires the president to annually submit a comprehensive budget to Congress that covers the full range of federal activities. Current law requires the president to submit his budget proposal no later than the first Monday in February. The creation of the budget usually begins approximately 10 months before the president submits his budget to congress (about 18 months before the start of the fiscal year). During the early stages of the budget's formulation, federal agencies prepare their budget requests following their own procedures.

The legislature proposes a budget bill for the executive agency that includes a cap on total spending and earmarked allocations to designated public projects. Each of these projects offers benefits to an interest group. In deciding which project to fund, the executive agency is able to observe the productivity of each of the projects before their decision. Earmarks occur when the executive serves a wide variety of interests, and a cap on spending occurs when the executive's constituency is not as broad as that of the powerful legislators. There is a separation of power between the legislative and executive branches of the government. The legislature composes the budget bill, which may or may not include a cap on total spending and earmarked allocations to designated projects, while an executive agency implements the bill by choosing which projects to take on within the limitations imposed by the law.