Identify the elements of the Budget Enforcement Act of 1990 (BEA), and explain why these provisions are significant to the budgetary process.

What will be an ideal response?

Student answers could include any of the following six elements/provisions: (1) separation of mandatory pending from discretionary spending; (2) differentiation of three types of discretionary spending--defense, international, and domestic--with separate spending targets for each; (3) a “pay-as-you-go” plan for mandatory spending and revenues, so that any increase in spending or reduction in revenue required an associated spending reduction or tax increase, to keep the package deficit neutral; (4) elimination of overoptimistic or unrealistic targets for deficit reduction; (5) inclusion of loan programs in the budget calculations; and (6) the OMB as scorekeeper. These provisions are generally significant to the budget process because they provide for deficit reduction (or at least management).