It is instructive to know the condition which has resulted from the fiscal development which we have just traced. The Secretary of the Treasury has become little more than an outlet through which reports of estimates may reach the House of Representatives. The power of making estimates was taken from him and placed in the hands of the various departments, as well as in those of some independent establishments. It then became the duty of the Secretary to record these estimates in the "Book of Estimates," which he transmitted to the House. Such a sweeping decentralization of power soon evidenced its weakness in that some expected estimates were not made, and others did not take the proper form, and it became necessary to empower the Secretary to see that all estimates were made and that they were in the desired form.

Still more recent legislation has conferred upon the Secretary of the Treasury the duty of submitting to Congress an estimate of receipts and expenditures for the current and ensuing years. It is now his duty, as soon as estimates of expenditures are received, to make an estimate of the revenues for the ensuing year. Should the estimated revenues not equal the estimated needs, it becomes the duty of the President, after a consideration of all the estimates, to recommend to Congress how the appropriations should be reduced or the revenues increased to make the revenue correspond to appropriations. These are steps in the right direction, but do not go far enough to insure centralized responsibility.

No Budget System. - The budget does not exist in the United States in the sense that other countries use it. About September of each year the various spending departments begin to make estimates for the year to commence the next July. These come to the Secretary of the Treasury to be transmitted to Congress in the "Book of Estimates." The estimates of the various departments are usually far from the actual needs. Past experience has shown that Congress is likely to reduce materially the appropriations from the estimates, consequently the departments fortify themselves by padding their requirements. Under such a situation the estimates become of little value. These estimates are transmitted to the House without revision, with no comparison of the demands of the different departments, and with no consideration of the possible revenue. As already indicated, the Secretary submits separately lists of estimated revenues and expenditures, while the President may recommend methods for increasing revenues or decreasing expenditures. Estimates may also come from army engineers and from the Court of Claims.

Fiscal Legislation. - The actual preparation of the appropriation and revenue bills really begins in Congress before or at the time the "Book of Estimates" is received. About fifteen separate committees that have the power to originate appropriations exist in each branch of Congress, each working separately from the others, and independently of the Secretary of the Treasury. Still other committees can make demands on the treasury. Still others have power over the revenues. The appropriation and revenue bills may be under the process of formation at the same time, entirely independent of each other, with nothing for guidance but past bills. The personnel of the committees is often not exactly what is desired in the consideration of such problems. Members are chosen according to the lengths of term in Congress by a regular system of promotion rather than for any special fiscal knowledge. That such special knowledge is often not found is indicated by the occupations which a number of the committeemen have followed before taking seats in Congress.

The reporting of an appropriation bill from its committee does not end its career. It is next placed before the House, where individual members may propose amendments. The Senate committee on the same subject must have its turn at considering it, and then the floor of the Senate. It is fortunate if it does not have to go before an adjustment conference committee of members from each House, where a bill is framed which is finally adopted. It is evident under this method of procedure that Congress initiates as well as ratifies appropriation and revenue bills. The House no longer has the balance of power intended by the Constitution, while bills carrying appropriations are strung throughout the entire session, with little consideration as to the source of funds. The revenue bill usually comes up late in the session, and for the last few years has not been sufficient to meet the appropriations. Deficiency bills have been used to make up the difference.

Lack of Control and Responsibility. - The control of Congress over fiscal administration practically ceases with the passage of the appropriation and revenue bills. The system of control over payments has been indicated. While the Secretary of the Treasury must make an annual report to Congress, no action is taken upon it. There is a committee in Congress for each of the departments, which has jurisdiction to examine the reports as to accuracy and conformity to the appropriations. Such investigations rarely occur unless initiated by some political motive. The Treasury Department has been remarkably free from suspicion, hence there has been little agitation for a systematic auditing of accounts. The present arrangement is, of course, no auditing at all, for there can be no systematic check where one department audits its own receipts and expenditures. Even though the various committees did avail themselves of the right to audit accounts, no verified result of expenditures and revenues as a whole could be obtained from the nine committees, the work of which would not be related. In no other country does there exist such a lack of restraint upon the Treasury Department.

The one outstanding criticism which appears from this survey of the Federal fiscal methods is the lack of unity and centralized authority from beginning to end. Appropriation and revenue bills arise and are modified in haphazard ways, and with no one really responsible. Such methods cater to the familiar "pork barrel legislation.'' Expenditures which will please the constituency of the Senator and Representative take rank of first importance, whether nationally desirable or not, because the future support is desired. These "log rolling" practices have no doubt been responsible for the waste of millions of dollars in constructing needless Federal buildings and in " improving" rivers and harbors where rivers and harbors can scarcely be found.

Not only is this initial waste of funds apparent, but the nation is saddled with an unnecessary upkeep charge in providing for the current needs of these institutions of political favoritism. Yet real responsibility for the many needless expenditures can be traced to no one, for no one in particular is responsible. The lack of coordination is further emphasized by the failure of Congress to exercise any further supervision over the funds after passing the bills of appropriations and revenue, and by the failure to provide some intelligent system of auditing accounts so that it could be determined easily how much money is being spent and for what purpose. The situation as portrayed by Secretary Glass was that " Congress votes with a lavish hand stupendous sums, conceived in a magnificent spirit of generosity, with a view to the enhancement of the prestige of the nation, or for the benefit of this or that element in the community." 1