The President's Budget for 2001: Depleted Economic Choices

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The government budget may be viewed as the financial mirror of society's economic and social choices, but does the budget contribute to the attainment of the overall objectives of economic policy, namely, growth, equity and stability? For government to be able to function and fulfill its role, it must collect sufficient resources and allocate and use these resources efficiently and effectively. In this regard, any assessment of the government budget cannot proceed without an implicit recognition of the integral relationship between revenue and expenditures, the two principal elements of fiscal policy. Thus, the analysis in this paper assesses not only expenditure program but also the revenue program of the President's budget for 2001. In particular, the President's budget proposal is evaluated in terms of two principal objectives of a good public expenditure management: fiscal discipline and strategic allocation of resources.