POLITICAL SCIENCE 623, FALL 2009
GOVERNMENTAL BUDGETING AND FINANCIAL MANAGEMENT
Dr. Roy T. Meyers
318 Public Policy
Class: Mondays, 4:30-7 PM
Office Hours: Tuesdays and Thursdays 1-2:20, and by appointment. You may call if that is more convenient than visiting my office. Office: 410-455-2196 Home: 410-381-4755
Email: meyers@umbc.edu I usually check email several times a day.
This syllabus is posted, with links embedded, at: http://userpages.umbc.edu/~meyers/623syl.htm and on the course Blackboard (Bb) page.
Course Topics and Style
This is a survey course on how U.S. governments--federal, state, and local--acquire and spend money. It is designed to complement other courses in the graduate curriculum in management and policy analysis. If you are interested in additional training about government and nonprofit financial management beyond what this course provides, talk to me about options.
People often think about budgeting as a dry and boring subject. In fact, it’s exactly the opposite--though some of the field IS technical, budgeting really involves fundamental issues of public policy, management and politics. We will address those issues throughout the semester, using real-world documents and events, such as the ongoing debate about health care reform.
The course also explores how budgets are prepared and then executed at the micro level. This is essential knowledge for public managers, elected officials, and those who work with or seek to influence them. For the first time, I am also incorporating some nonprofit financial management material into the course.
As budgeting is my research area, I’m capable of lecturing on these topics for far more time than we have for the course. You might even learn something from that approach. But to the extent possible, I’d like class sessions to emphasize discussion. Similarly, many assignments emphasize learn-as-you-do exploration of ideas and skills.
Readings
Because of the current events approach of this course, this is a “living syllabus”: I may change assigned readings to take advantage of the most timely and intelligent sources. I will use the announcements function of Bb to highlight any changes.
Most of the readings can be accessed from the web or the course Bb page. Selected readings on Bb are from a book I edited: Roy T. Meyers, 1999. Handbook of Government Budgeting. San Francisco: Jossey-Bass.
The required texts for the course are:
Greg G. Chen, et. al., 2009. Budget Tools: Financial Methods in the Public Sector. Washington, D.C.: CQ Press.
Thomas A. McLaughlin, 2009. Streetsmart Financial Basics for Nonprofit Managers, third edition. Hoboken, NJ: John Wiley and Sons.
While for most assignments it is unnecessary to read beyond the assigned readings, you may go beyond them to learn more. You will find many useful links on my budgeting and policy web pages:
American budgeting: http://userpages.umbc.edu/~meyers/linkambud.htm
Maryland budgeting: http://userpages.umbc.edu/~meyers/linkmdstatebud.htm
International budgeting: http://userpages.umbc.edu/~meyers/linkintlbud.htm
American politics, policy, and management: http://userpages.umbc.edu/~meyers/linkampol.htm
I expect that you will attend class regularly, having completed the readings and assignments before they are covered in class.
Class participation will be 20% of your final grade. A variety of activities count as class participation: careful listening, speaking in discussions, roleplaying, and asking questions if you are confused. Similarly, I encourage you to challenge my position if you disagree with it. I will exercise my academic freedom to express my own views at times, and when you vocally disagree, you should be absolutely confident that I will not penalize you.
The other 80% of your final grade will be comprised of weekly assignments. The assignments are listed on the course Bb page, and they are subject to change as I learn more about your skills and interests and as events unfold during the semester.
I have a strong preference for clear and simple writing. Writing assignments should be typed and use regular fonts and margins, and generally should not exceed two pages. Occasionally students in previous classes have mentioned to me that they were confused about “what I wanted” in their answers to the assignments. By this they usually meant, “what’s the correct answer to the question?” But in fact, in most assignments there are no "correct answers." Rather, you face uncertain situations and need to come up with a reasonable course of action--there are usually several. Take this opportunity to get used to the typical reality of policy and politics.
Parts of the course will train you in basic budget preparation and analysis skills using Excel spreadsheet exercises. If you are a novice with spreadsheets, start practicing now using the exercises in Chapters 2 and Appendix C of the Chen text.
Flexibility
Of course, with the H1N1 pandemic looming, we will all have to be especially flexible this semester. I will follow the policy set by UMBC’s administrators, which will be based on scientific guidance from the Centers for Disease Control and other authorities. As of now, what this means is:
1. If I am sick with flu symptoms, I will cancel class.
2. If you are sick with flu symptoms, do not come to class. As is recommended by health authorities, I will not require any medical documentation for your absence. I will be very generous in giving your opportunities to make up work.
3. If the pandemic becomes severe enough so that UMBC must close its campus, I will attempt to continue the course in a distance learning form (that is, assuming #1 above doesn’t apply). Exactly how I will do that will depend on some factors I cannot predict as I write this, including your access to broadband and familiarity with certain applications. So we’ll have to make it up as we go along, I’m afraid.
Class Schedule and Assignments
9/14 Intro to federal budget concepts and projections
Congressional Budget Office, 2009. The Budget and Economic Outlook: An Update. Chapter 1: http://www.cbo.gov/doc.cfm?index=10521&type=1, pp. 1-26. Scan other sections.
Office of Management and Budget 2009. Mid-Session Review. http://www.whitehouse.gov/omb/asset.aspx?AssetId=1702
Definitions of important budget concepts can be found in the following sources:
http://www.cbo.gov/budget/glossary.shtml
http://www.whitehouse.gov/omb/budget/fy2010/assets/concepts.pdf
9/21 Budgets and the economy; short-run projections and related methods
Henry J. Aaron, 2000. “Presidential Address–Seeing Through the Fog: Policymaking with Uncertain Forecasts,” Journal of Policy Analysis and Management. 19: 2, pp. 193-206.
Ron Suskind, 2004, The Price of Loyalty, N.Y.: Simon and Schuster, pp. 53-69; 295-306.
Committee for a Responsible Federal Budget, 2009. “The Extraordinary Actions Taken by the Federal Reserve.” June. http://www.crfb.org/documents/FedActions.pdf
Stimulus Watch: http://www.usbudgetwatch.org/stimulus
Donald J. Boyd, 2009. “Coping with Effects of Recession in the States,” Rockefeller Institute, read slides only through p. 30; http://www.rockinst.org/pdf/government_finance/2009-07-Boyd_GRA_Presentation.pdf;
Budget Tools, chapter 4.
9/28 Long-run budget projections; time inconsistency
Social Security and Medicare Boards of Trustees, “Status of the Social Security and Medicare Programs: a Summary of the 2009 Annual Reports”: http://www.ssa.gov/OACT/TRSUM/index.html
Watch I.O.U.S.A (the 30-minute version): http://www.iousathemovie.com/
Henry Aaron, 2007. “Chronic Deficit: Entitlement Crisis? Or Health Financing Problem?”
http://www.sharedprosperity.org/av/070412/20070412-aaron.swf
CBO’s Long-Term Model: An Overview, 2009, June. http://www.cbo.gov/doc.cfm?index=10328&zzz=39153
CBO, 2009. The Long-Term Budget Outlook. http://www.cbo.gov/ftpdocs/104xx/doc10455/Long-TermOutlook_Testimony.1.1.shtm
10/5 Financial accounting and reporting; subnational governments and the credit markets
Budget Tools, chapters 6 and 9.
Streetsmart, chapters 3-7.
Dean Michael Mead, “Information About the Whole Government,” from What You Should Know About Your Local Government’s Finances, Stamford, CT: Governmental Accounting Standards Board, 2000, pp. 7-30.
Baltimore CAFR: http://www.baltimorecity.gov/government/finance/downloads/reports/CAFR2008.pdf
10/12 Taxes
Tax Policy Center, 2008. The Tax Policy Briefing Book. http://www.taxpolicycenter.org/briefing-book/index.cfm
Jacob S. Hacker and Paul Pierson, 2005. “Abandoning the Middle: The Bush Tax Cuts and the Limits of Democratic Control,” Perspectives on Politics, 3: March, pp. 33-53.
Leonard E. Burman, 2009. A Blueprint for Tax Reform and Health Reform. http://www.taxpolicycenter.org/UploadedPDF/1001262_blueprint_reform.pdf
10/26 Budget preparation and managerial accounting
Budget Tools, chapters 1-3
Streetsmart, chapter 8, 12, 13
Jacqueline H. Rogers and Marita B. Brown, Handbook 17, “Preparing Agency Budgets”
Barry White, Handbook 18, “Examining Budgets for Chief Executives”
11/2 Responsibility budgeting
Michael Barzelay and Fred Thompson, “Efficiency Counts: Developing the Capacity to Manage Costs at the Air Force Material Command,” IBM Center for the Business of Government, August 2003: http://www.businessofgovernment.org/pdfs/barzelay_report_fms.pdf
Handouts on the Baltimore City school budget reforms
11/9 Performance budgeting and policy evaluation
Budget Tools, chapter 7.
Alfred Ho, 2007. “The Governance Challenges of the Government Performance and Results Act: A Case Study of the Substance Abuse and Mental Health Administration,” Public Performance and Management Review, 30: March, 369-397.
Robert D. Behn, 2003. “Why Measure Performance? Different Purposes Require Different Measures,” Public Administration Review, 63: September, 586-606.
Donald P. Moynihan, 2008. The Dynamics of Performance Management. Washington, D.C.: Georgetown University Press, chapters 6 and 9.
11/16 Budget advocacy, earmarks, and interest group politics
Roy T. Meyers, Handbook 22, “Strategies for Spending Advocates”
Washington Post series “Harvesting Cash” http://www.washingtonpost.com/wp-srv/nation/interactives/farmaid
Robert Kaiser, 2007, Washington Post Citizen K Street Series: http://blog.washingtonpost.com/citizen-k-street/chapters/introduction/
Read intro and “chapters” 6, 8-11
Articles on Boeing tanker lease
Find an earmark for a recipient in Maryland using: http://thomas.loc.gov/home/approp/app10.html
11/23 Congressional budget process; budget rules and health reform
Powerpoint slides on intro to the federal budget process
Robert Keith, 2008. “Introduction to the Federal Budget Process.” Congressional Research Service. http://budget.house.gov/crs-reports/98-721.pdf
Roy T. Meyers and Philip G. Joyce, 2005, “Congressional Budgeting at Age 30: Is It Worth Saving?,” Public Budgeting and Finance, 2005, Silver Anniversary Issue, pp. 68-82: http://userpages.umbc.edu/%7Emeyers/cbpat30.pdf
Selected readings on health reform
11/30 Institutional alternatives
International Budget Project. “Participatory Budgeting.” http://www.internationalbudget.org/themes/PB/index.htm
Play the “Budget Hero” game:
http://marketplace.publicradio.org/features/budget_hero/–but do so assuming that you are
an incumbent legislator who is running for re-election.
Netherlands Bureau for Economic Policy Analysis, 2006. “Charting Choices 2008-2011: Economic Effects of Eight Election Platforms.” The Hague: December.
Jurgen von Hagen, Andrew Hughes Hallett and Rolf Strauch, 2002, “Budgetary Institutions for Sustainable Public Finances,” from Marco Buti, Von Hagen and Carlos Martinez-Mongay, The Behavior of Fiscal Authorities, N.Y.: Palgrave, pp. 94-112.
George
Kopits and Steven Symansky, 1998, “Fiscal Policy Rules,” International
Monetary Fund, Occasional Paper 162, Washington, D.C.
Wednesday 12/2 at 4pm A highly recommended talk: Bob Reischauer on health care reform, for the Social Sciences Forum, Library Gallery
---
12/7 Capital budgeting and financing; procurement/contracting out
Streetsmart, chapter 11
Budget Tools, chapter 5
Department of Legislative Services, Legislative Handbook, Volume 4, http://mlis.state.md.us/other/Legislative_Handbooks_2007/Volume_IV.pdf
Scan chapters 6-8 for basic concepts.
12/14 Budget execution and cash management; fraud, waste, and abuse; internal controls; audits
Budget Tools, chapter 8.
Streetsmart, chapters 9 , 10 and 18.
William Stanbury and Fred Thompson, “Toward a Political Economy of Government Waste: First Step, Definitions,” Public Administration Review, 55: September 1995, pp. 418-427.
Scan the reports and bulletins of the Maryland Office of Legislative Audits.
12/21 Capstone: reducing Maryland’s deficit
beta version of Maryland budget computer simulation
Briefings to be identified from General Assembly website: http://mlis.state.md.us/Other/Fiscal_Briefings_and_Reports/Fiscal_Br_Rep_Ana_Index.htm
Roy T. Meyers, 2007. “Addressing Maryland’s Structural Deficit through Better Performance Budgeting and Priority-Setting,” UMBC Policy Brief, http://userpages.umbc.edu/%7Emeyers/policy_brief_5.pdf
Maryland Budget and Tax Policy Institute, 2008. “Maryland Policy Report,” June, pp. 1-10. http://www.marylandpolicy.org/documents/junereport060608.pdf