Budgeting for existential crisis: The federal government as society's guarantor

IF 0.9 Q4 PUBLIC ADMINISTRATION
F. Redburn
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引用次数: 0

Abstract

Onset of the coronavirus disease 2019 pandemic produced a fiscal shock of almost unprecedented scale and suddenness. Procedurally, the exigencies of responding to such crises make a mockery of the apparatus of normal budgeting. Standard near-term constraints and targets for fiscal choice lose utility as guides for budgeters;extraordinary procedures are invoked. Assessing the initial fiscal response reveals the extraordinary role the federal government plays during such a period as ultimate guarantor of the economy and social order. The federal government has constitutional responsibility and, under duress, is the only set of institutions with the capacity to play this role. Federal responses to ordinary emergencies generally assess their contribution to relief and recovery. In an extraordinary emergency such as the pandemic, responses may be assessed for their contributions to two additional policy objectives: readiness and resilience. An event of this magnitude also offers an opportunity to reconsider the aims of fiscal policies and whether the terms for measuring and judging policy outcomes are appropriate for such a period. The standard budget baseline lacks a component for the average multiyear cost of the federal government's exercise of its role as societal guarantor. The standard metric for judging fiscal policy-public debt as a percent of gross domestic product-is problematic as a fiscal policy target. An alternative would capture changes in public sector net worth, highlighting the net fiscal and economic benefit or cost of any policy to borrow in order to invest in long-term policy objectives. Applications for Practice The framework provided here can be used to assess the unfolding budget responses to crisis and how those responses are affected by procedures used to develop and execute the federal budget, addressing such questions as: Whether costs arising from the federal government's broad responsibility for social order in severe crises should be recognized in the budget baseline and reserved in the budget as they arise, that is, as an estimate of the average annual cost of the government's role as societal guarantor. Whether the budget horizon should be extended and whether decisions should be organized around major policy objectives, including readiness and resilience, to encourage more strategic responses. To what extent the budget process should privilege investment in public assets that build readiness and resilience and thus sustain fiscal capacity to meet current commitments and future shocks. (Because of uncertainty, budgeters cannot predict returns for any specific investment or investment category. It follows that they need a budgetary strategy that maximizes average net returns from a broadly diversified investment portfolio-a classic strategy to cope with uncertainty. This implies purchasing a broad set of options that may be exercised in the future to either [1] capture for the public the large returns on investments that pay off [opportunity options] or [2] hedge against disruptive, even catastrophic events that generate large losses [insurance options] [Redburn, 2015, 12]). Whether traditional targets of fiscal policy-deficits and debt to gross domestic product ratios-should be augmented or replaced by metrics that capture changes in public net worth, thus recognizing ongoing creation of public assets as well as accruing commitments in the primary target for fiscal policies.
为生存危机做预算:作为社会担保人的联邦政府
2019冠状病毒病的爆发产生了规模和突然性几乎前所未有的财政冲击。从程序上讲,应对此类危机的紧迫性是对正常预算编制机制的嘲弄。财政选择的标准近期约束和目标失去了作为预算指南的效用;调用非常程序。评估最初的财政反应揭示了联邦政府在这一时期作为经济和社会秩序的最终保障者所发挥的非凡作用。联邦政府负有宪法责任,在胁迫下,它是唯一有能力发挥这一作用的机构。联邦政府对一般紧急情况的反应通常评估其对救济和恢复的贡献。在疫情等特殊紧急情况下,可以评估应对措施对两个额外政策目标的贡献:准备就绪和恢复力。如此规模的事件也为重新考虑财政政策的目标以及衡量和判断政策结果的条件是否适合这一时期提供了机会。标准预算基线缺乏联邦政府履行其社会保障角色的多年平均成本的组成部分。判断财政政策公共债务占国内生产总值百分比的标准指标作为财政政策目标是有问题的。另一种选择是捕捉公共部门净值的变化,突出任何借款政策的净财政和经济效益或成本,以投资于长期政策目标。实践应用本文提供的框架可用于评估正在展开的预算危机应对措施,以及这些应对措施如何受到用于制定和执行联邦预算的程序的影响,解决以下问题:联邦政府在严重危机中对社会秩序承担广泛责任所产生的成本是否应在预算基线中予以确认,并在出现时保留在预算中,即作为政府作为社会保障者的平均年度成本的估计。是否应延长预算期限,是否应围绕主要政策目标(包括准备情况和复原力)组织决策,以鼓励采取更具战略性的应对措施。预算过程应在多大程度上优先考虑对公共资产的投资,以建立准备和恢复能力,从而维持财政能力,履行当前承诺和应对未来冲击。(由于不确定性,预算制定者无法预测任何特定投资或投资类别的回报。因此,他们需要一种预算策略,使广泛多样化的投资组合的平均净回报最大化——这是应对不确定性的经典策略。这意味着购买一系列未来可能行使的选项为公众获取有回报的投资的巨大回报[机会期权]或[2]对冲造成巨大损失的破坏性甚至灾难性事件[保险期权][Redburn,2015,12])。财政政策赤字和债务与国内生产总值比率的传统目标是否应该被反映公共净值变化的指标所增加或取代,从而承认公共资产的持续创造以及财政政策主要目标中的累积承诺。
本文章由计算机程序翻译,如有差异,请以英文原文为准。
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来源期刊
Public Budgeting and Finance
Public Budgeting and Finance PUBLIC ADMINISTRATION-
CiteScore
2.10
自引率
14.30%
发文量
25
期刊介绍: Public Budgeting & Finance serves as a forum for the communication of research and experiences on all facets of government finance and provides meaningful exchange between research from universities, private and nonprofit research institutes, practitioners in public financial markets, government agencies, and the experience of those who practice government budgeting and finance. Researchers, practitioners, and teachers of applied government finance turn to Public Budgeting & Finance to find understandable, reliable, and thoughtful analysis of issues important in the field. The content of the journal spans the spectrum of budget process and policy and financial management, is never limited to one level of government or even to one country, and always even-handedly crosses disciplines and approaches in applied government finance.
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