Particularly popular when there is dissatisfaction with debt or deficit levels, such proposals seek to establish a legal mandate for a budgetary policy or fiscal objective, such as a specific limit on the deficit level, or the requirement for a balanced federal budget. This report focuses specifically on one such budget process reform: the concept of creating a statutory limit on total spending. A total spending limit, often referred to as an overall spending cap or an omnicap, consists of statutory long-term or permanent limits on federal spending, encompassing both discretionary and direct spending (also referred to as mandatory or entitlement spending). Further, the analysis in this report concerns measures that propose a total spending limit that also include an automatic statutory mechanism to enforce the spending limit in the event that compliance is not achieved through legislative action. In the event of a breach, an automatic enforcement mechanism would impose reductions in spending. The recent growth in spending, both in dollar terms and relative to the economy as a whole, has garnered support for total limits on spending. Several groups and organizations have recommended a total spending cap, though few provide detail on what such a legislative proposal might include. In addition, the House-passed budget resolution for FY2012, H.Con.Res. 34 , includes a policy statement on budget enforcement that calls for Congress to enact total spending limits, and on July 19, 2011, the House passed H.R. 2560 , which includes total spending limits for FY2013-FY2021. The next section of the report discusses typical features of total spending limits and provides information on how they may vary. The final section of the report includes observations on compliance with the spending limits, based on historical experiences with statutory budget controls. Statutory limits on total spending address at least two perceived limitations of the congressional budget resolution. Finally, levels of direct spending are especially subject to unpredictable variations. Criticisms

Criticisms that have been raised of spending limit proposals have rested on several grounds. Lastly, it can be argued that relying on automatic reductions to fulfill budgetary levels cedes Congress's control over levels and details of spending. H.R. Others, such as S. 245 , and H.R. Similarly, H.R. Automatic Reduction Mechanism (Sequestration)

The purpose of including automatic enforcement mechanisms in proposals to create total spending limits is to enforce spending limits on spending that results from already enacted legislation.
Often when there is dissatisfaction with budgetary levels, budget process reforms are proposed to mandate a specific budgetary policy or fiscal objective. This report focuses specifically on one such budget process reform—the concept of creating a statutory limit on total spending.
As discussed in this report, a total spending limit consists of statutory long-term or permanent limits on federal spending coupled with a statutory enforcement mechanism that would make automatic reductions in spending in the event that compliance with the limits is not achieved through legislative action. Such spending limits would comprise any new spending as well as spending that results from previously enacted law. By encompassing all types of spending, and by including a statutory enforcement mechanism, a total spending limit attempts to remedy a perceived limitation of the congressional budget resolution, under which Congress establishes limits on spending in various categories that can be enforced or waived by Congress at its own discretion.
The recent growth in spending, both in dollar terms and relative to the economy, has generated support for total limits on spending. Several groups and organizations have recommended a total spending cap, and on July 19, 2011, the House passed H.R. 2560, the Cut, Cap and Balance Act of 2011, which includes total spending limits for FY2013 through FY2021. In addition, the House-passed budget resolution for FY2012, H.Con.Res. 34, includes a policy statement calling for Congress to enact total spending limits. Other legislative proposals introduced in the 112th Congress include total spending limits, such as S. 245, H.R. 1605, H.R. 1848, and H.R. 2041.
The potential effectiveness of a statutory limit on total spending is complicated by projection uncertainty, unforeseen events, and especially the complex nature of direct spending. Statutory limits have been subject to criticism for ceding Congress's "power of the purse," targeting spending rather than the deficit or debt, attempting to address a budgetary problem through procedure instead of policy changes that would themselves reduce spending, and for other reasons.
This report provides information on the concept of a statutory limit on total spending, including objectives, complications, and criticisms. The report also includes information on the many features of spending limit proposals, which can vary considerably. Lastly, the report provides observations on budgetary controls, similar to statutory spending limits, from an historical perspective.