An Essential Component of Any Policy Toolkit to Address Federal Budget Deficits: Tax Expenditure Reform

The last half‐century has been characterized by ongoing federal deficits as well as recurring government shutdowns, which have only accelerated in the last decade. We contend that Congress has been unable to exercise adequate control over both annual revenues and expenditures not merely due to political partisanship but because of something no less basic: inadequate budgetary and fiscal processes. One budgetary element important to the federal government's fiscal system involves tax expenditures. As a reform to move closer to budgetary balance, we propose in this commentary that Congress should severely scale‐back, recharacterize, and regularly review “tax‐expenditures.”