Commission on Economy and Efficiency facts for kids

The Commission on Economy and Efficiency was a special group created by President William Howard Taft between 1910 and 1913. Its main job was to look at the United States federal government and suggest ways to make it work better, especially how it managed its money. This group is famous for suggesting the very first budget for the entire federal government. It also helped set up a way for presidents to create special commissions to study how the government could be improved.

Why the Commission Was Started

This Commission was set up to find more efficient ways for the government to operate and to suggest improvements. Its most important goal was to study how to create a budget for the whole country. But it also looked at other things, like what different government departments were responsible for, how people were hired, how money was handled, and how the government did its daily business.

President Taft learned from a previous group, the Keep Commission, that Congress often ignored new ideas. So, he made sure to get Congress's approval before forming this new Commission. This way, he hoped Congress would be more likely to accept the changes. He also got money from Congress to pay for the Commission's work.

The Commission was led by Frederick Cleveland, a well-known expert from the New York Bureau of Municipal Research. He was already famous for creating one of the first city budgets for New York City, which was the biggest government in the U.S. at the time based on how much money it spent.

Creating a National Budget

Towards the end of the 1800s, the federal government was spending more money than it was collecting in taxes. This meant it had "deficits" (it was in debt) because it didn't have enough ways to collect money and there was a lot of demand for government services. Because of this, the Commission's main goal was to create a better system for managing the national budget.

The members of the Commission used their experience from working on New York City's budget and applied it to the national government. After studying the federal government, they published a report called The Need for a National Budget. This report strongly suggested that the federal government should create a national budget.

The Commission didn't just want to write about the idea of a federal budget. President Taft, with the help of William Willoughby from the Commission, went against what some in Congress thought. They believed the President had the right to share any information with Congress in any way he chose. So, in 1913, President Taft sent Congress the very first complete federal budget, put together exactly how the Commission had designed it. This was one of President Taft's last official actions as president. Even though Congress didn't immediately use Taft's budget, the idea of a national budget was now firmly established.

What the Commission Achieved

Like many big government changes, the Commission's main ideas and suggestions weren't put into action right away. However, besides some smaller changes that could be made easily, the Commission left two very important and lasting impacts.

First, the Commission helped establish that the President has a rightful role in changing how the government is organized. Before this, the only other presidential group that looked at how efficient the entire government was, was the Keep Commission. But Congress ignored its ideas and even cut off funding for any future presidential commissions. By getting Congress's approval first, President Taft created a way for presidents to help guide efforts to reorganize the government.

Second, and perhaps most importantly, the Commission's work led to the creation of the national budget. This budget system was officially put in place by the Budget and Accounting Act of 1921. The federal budget, which is still used today, often creates some disagreement between the President and Congress. For many years after the 1921 Act, the President gained more power to shape and control the U.S. budget. It wasn't until the Congressional Budget and Impoundment Control Act of 1974 that Congress started to get back some control over the budget process. The idea of a federal budget, first imagined by the Commission on Economy and Efficiency, is important but also complicated, and it's still a topic of discussion today.