Reforming Credit Reform

Lucas, Deborah; Phaup, Marvin

doi:10.1111/j.1540-5850.2008.00918.x

Cited by 13 publications

(13 citation statements)

References 0 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…The New Zealand Earthquake Commission is one model of this approach. Good results have also been obtained with less formal arrangements through the use of contingency funds by state and local governments (Hou and Duncombe, 2008;Rodriquez-Tejedo, 2008) and below-the-line credit financing accounts (Lucas and Phaup, 2008).…”

Section: Government-provided Insurancementioning

confidence: 99%

Budgeting for disasters

Phaup¹,

Kirschner²

2010

OECD Journal on Budgeting

Self Cite

View full text Add to dashboard Cite

Some ways of budgeting for disasters have the potential to increase welfare by increasing national savings, reducing exposure to risk and promoting mitigation prior to a loss. Those ways can also contribute to aggregate fiscal stability over the long term. The power of budgeting, however, can be misdirected to increase losses and lead to fiscal instability. This paper describes the potential for gain from alternative budgetary treatments of policies aimed at reducing the effects on consumption of random shocks to income and wealth. It identifies a critical difference between alternatives: budgetary recognition of expected costs of relief and recovery before the loss event. We classify those different methods as ex ante and ex post budgeting. We also consider some budgetary mechanisms that can promote effective recognition and constrain opportunistic behaviour by elected officials. Finally, this paper describes related budgetary practices in some OECD countries. Many have instituted policies consistent with ex ante budgeting, but we have insufficient information to determine their effectiveness.

show abstract

Section: Government-provided Insurancementioning

confidence: 99%

Budgeting for disasters

Phaup¹,

Kirschner²

2010

OECD Journal on Budgeting

Self Cite

View full text Add to dashboard Cite

show abstract

“…Nonetheless, one cannot anticipate all the effects on decisions of process change (Manzi ) nor of the detailed form in which the proposed change may be enacted (Lucas and Phaup ). Accordingly, the proposal could be subjected to a limited pilot trial before consideration of application to all mandatory programs.…”

Section: Concluding Commentmentioning

confidence: 99%

Budgeting for Mandatory Spending: Prologue to Reform

Phaup

2018

Public Budgeting & Finance

Self Cite

View full text Add to dashboard Cite

This paper identifies a feature of the federal budget process that, consistent with the findings of behavioral research, increases the difficulty for policymakers of restraining the growth of mandatory spending to sustainable rates: budgetary accounting. Specifically, use of cash‐basis accounting, on‐budget payment accounts, and a narrow definition of debt defers recognition of the cost of mandatory spending until benefits are payable and politically unavoidable. Acting to control “future” costs is cognitively more difficult for decision‐makers than addressing cost now as obligated. The paper proposes a trial of alternative budgetary accounting for mandatory spending that saliently recognizes cost as it accrues.

show abstract

“…The estimated ongoing cost of sponsorship of the enterprises for the budget period could be recognized in outlays and the deficit through a periodic payment from an on‐budget account to a means of financing (MOF) GSE reserve account. Budget outlays and the deficit would include the estimated subsidy while its receipt by the MOF account would reduce federal borrowing required to finance the deficit (Lucas and Phaup 2008).…”

Section: Alternative Budgeting For Gsesmentioning

confidence: 99%

“…The revenue side of the budget would also be affected by those accounting changes. A portion of the cost of guarantees estimated using market values, rather than the synthetic measures specified in the Federal Credit Reform Act, corresponds to the compensation for risk bearing by taxpayers (Lucas and Phaup 2008). This cost is paid by taxpayers, who forgo that compensation, each budget year.…”

Section: Alternative Budgeting For Gsesmentioning

confidence: 99%

Federal Use of Implied Guarantees: Some Preliminary Lessons from the Current Financial Distress

Phaup

2009

Public Administration Review

Self Cite

View full text Add to dashboard Cite

The U.S. financial crisis and recession that began in 2007 poses profound challenges for public policy and administration. It also provides useful information about the effects of economic policies. This paper considers the implications of current developments for the use of implied guarantees as an instrument of public policy. It draws on experience with Fannie Mae and Freddie Mac to argue that implied federal guarantees have a severe disadvantage. Their costs are largely unmeasured, unrecognized in the budget, and unmanaged. Yet their use appears to be increasing in the current crisis. To minimize the costs of the expanded financial safety net, government should measure and manage those costs more effectively. To that end, this paper proposes new budgetary treatments of federal implied guarantees.

show abstract

Reforming Credit Reform

Cited by 13 publications

References 0 publications

Budgeting for disasters

Budgeting for disasters

Budgeting for Mandatory Spending: Prologue to Reform

Federal Use of Implied Guarantees: Some Preliminary Lessons from the Current Financial Distress

Contact Info

Product

Resources

About