Fiscal Responsibility


  • The President signed an Executive Order on government contracting to fight waste and abuse.
  • The President launched to track spending from the Recovery Act, an unprecedented step to provide transparency and accountability through technology.
  • The President wrote to the congressional leadership calling on them to pass statutory Pay-As-You-Go rules so that any new non-emergency tax cut or entitlement expansion offset in the budget.

Changing the way Washington does business

Just as important as changing what Washington does is to change how it does it. We cannot begin to tackle the challenges we face in the short term to revive our economy and in the long term to put us on the path to growth without restoring fiscal responsibility and accountability to Government.

Restoring Fiscal Discipline

The Administration in its first weeks has taken the initial steps to restore fiscal discipline by requesting and signing into law an economic recovery bill that is free of all earmarks and by launching – an unprecedented effort to allow the public to track how and where recovery funds are actually used. To continue this progress, the Administration will:

  • Cut the deficit in half by the end of the President’s first term. On January 20, 2009, the President inherited a $1.3 trillion budget deficit. The President has put forth a budget that will halve this deficit by the end of his first term, bring non-defense discretionary spending to its lowest level as a share of GDP since 1962.
  • Review the budget line-by-line for waste. We should be investing taxpayer dollars in efforts and programs with proven records of success and reallocating or cutting programs that do not work or whose benefits are not worth their cost. Secretary of Defense Gates has unveiled an unprecedented effort to reform defense contracting, and the President has launched a line-by-line review of the federal budget to pinpoint what programs works and what needs to be terminated or reduced in scope..
  • Return to honest budgeting. Too often in the past several years, budget tricks were used to make the government’s books seem stronger than they actually were. The President put forward a budget that rejects many of these gimmicks, most notably, the exclusion of war costs.
  • Return to Pay-As-You-Go budgeting. The President and his team are working with Congress to develop a set of budget enforcement rules that are based on the tools that helped create the surpluses of a decade ago, including statutory PAYGO.

Making Government More Effective

For decades, the argument in Washington has been between those who say that government is the cause of every problem and those who say that it’s the answer. What has become clear over the past eight years, especially in light of the Federal Government’s response to Hurricane Katrina, is that what bothers Americans is bad government—government that does not to do its job effectively and efficiently. To make Government more effective, the Administration will:

  • Eliminate wasteful redundancy. The Administration will conduct an immediate and periodic public inventory of administrative offices and functions and require agency leaders to work together to root out redundancy.
  • Streamline government procurement. The President will implement the GAO’s recommendations to reduce erroneous Federal payments, reduce procurement costs with purchase cards, and implement better management of surplus Federal property.
  • Reform federal contracting and acquisition. The Administration will take several steps to make sure that taxpayers get the best deal possible for Government expenditures. We will review the use of sole source, cost-type contracts; improve the quality of the acquisition workforce; and use technology to create transparency around contracting. In the Defense Department, Secretary Gates has identified major weapons programs for cut or reduction in order to get the most our of our defense dollars.
  • Put performance first. The President is creating a focused team composed of top-performing and highly-trained Government professionals and headed by a new Chief Performance Officer (CPO). The CPO will work with Federal agencies to set tough performance targets and hold managers responsible for progress.
  • Spend taxpayer dollars wisely on our large entitlement programs. With billions of dollars being spent in programs such as Social Security, Medicare, and Medicaid upon which so many Americans rely, it is important that they are run efficiently and effectively. To that end, the Administration will make significant investments in expanding oversight activities in the largest benefit programs and increasing investments in tax compliance and enforcement activities.


THU, MAY 7, 1:07 PM EST

Ending Bad Habits

The President discusses how his budget reductions released today reflect a change in the way Washington does business.
THU, MAY 7, 10:06 AM EST

Determining What Works, Line by Line

OMB Director Peter Orszag tells us about the budget being released today, in particular the volume on Terminations, Reductions, and Savings.
TUE, APRIL 28, 9:15 PM EST

Delivering on Change, an Inside Look

Pete Souza and the White House Photo Office bring us an exclusive, massive, unique look at the President’s term so far.
Viewing this video requires Adobe Flash Player 8 or higher. Download the free player.