If you've ever worked in an organization, you know how important budgets are. And that's even more true in government, where budget decisions embody the priorities set by policymakers, determine where tax dollars go, and can have profound effects on society. Still, budgets are boring to many people—and apparently to many foundations, too. As we've noted before, work on fiscal and budgetary issues doesn't tend to attract a lot of funders. Yet one result of too little scrutiny in this area is that critical budgetary choices may not be fully understood by policymakers, advocates or the public until it's too late. A case in point is how federal cuts to discretionary spending enacted by Congress way back in 2011 are still reverberating through multiple sectors, affecting everything from science research to national parks and public education.
Now, even deeper budget cuts are being proposed by the Trump administration. Meanwhile, many states and localities face both mounting fiscal problems and growing ideological attacks on government with big implications for funding for a range of important programs.
Who funds budgetary work? Since the 1990s, a small group of funders has given steady support to the State Priorities Partnership, a network of 40 policy centers in the states that focus on "[r]educing inequality and fighting poverty by making sure states have the resources they need through an accountable budget process." The mothership for this operation is the Center for Budget and Policy Priorities, which has long enjoyed support of a number of top foundations. A similar constellation of state and national policy groups on the right also work on budget issues, mostly supported by a handful of conservative foundations like Bradley and Sarah Scaife.
The Peter G. Peterson Foundation is another funder of budgetary work. It was founded in 2008 by the private equity billionaire and is committed to addressing "America's long-term fiscal challenges." Pete Peterson has been warning about these challenges for over two decades and is unique among philanthropists in that he's made fiscal policy a central focus of his giving, although his foundation recently branched out by bankrolling the creation the Peterson Center on Healthcare, as we've reported.
Now, some new funders are appearing in the budget funding space—with an eye toward generating better, more reliable data on what government is spending money on and how this spending affects different parts of society.
Recently, we covered the launch of USAFacts, Steve Ballmer’s attempt to demystify the federal budget for a general audience. Unlike most of the policy groups that crunch budget numbers, USAFacts doesn't have a broader agenda. It says, "We don’t make judgments or prescribe specific policies. Whether government money is spent wisely or not, whether our quality of life is improving or getting worse—that’s for you to decide. We hope to spur serious, reasoned, and informed debate on the purpose and functions of government."
This effort is housed at the Ballmer Group's offices in Seattle. Steve Ballmer said he's invested $10 million in USAFacts so far, and is ready to keep that support flowing indefinitely.
Housed at the Wharton School at the University of Pennsylvania and created just last year, PWBM is non-partisan and says its goal is "to be the honest broker of analysis working at the intersection of business and policy to help policymakers, the public, and businesses make fact-based decisions." It sees this work as critical because the "federal budget is one of the most important documents produced by our government and provides a roadmap for our nation’s priorities. However, there is currently a limited opportunity for policymakers to understand how a policy change will impact our nation’s economy and budget while they are writing legislation."
Free to all users, the PWBM platform contains a wealth of analysis on issues like demographics, immigration, Social Security, housing and tax policy. Its most engaging feature is a collection of interactive “simulators” that let users adjust policy variables and view long-term effects. The new funding from the Arnold Foundation will allow PWBM to develop better tools to "evaluate the economic and budgetary impact of federal policy proposals" and make longer-term forecasts about the implications of policy decisions.
If you know anything about the Arnold Foundation, you can understand why it would be giving big money to this project. The foundation is engaged in an epic quest to ensure that government policies and programs are based on better data and evidence. “Governments have an obligation to balance social good with financial responsibility," said LJAF Vice President Josh McGee. "Decisions should be made in a thoughtful and deliberate manner, and legislators should use rigorous evidence to help them design effective policies.” LJAF has supported research and policy analysis in areas as diverse as criminal justice reform, healthcare, education, scientific research, and pay for success programs. You can see how PWBM's research could support work in many of these areas. In similar fashion, back in 2015, LJAF gave $7.4 million to Harvard’s Kennedy School of Government to advance government effectiveness through the better use of data science.
It's worth noting that PWBM is also supported by the Ballmer Group and is a key partner working to compile the data for USAFacts. The rest of PWBM’s listed funders are all business leaders and Wharton School alumni. They include private equity billionaire Marc Rowan, who we’ve covered here before, Marc Spilker, S.A. Ibrahim, Leonard M. Tannenbaum, and David Trone. These men are also key funders of the Wharton Public Policy Initiative.
Leading PWBM is Kent Smetters, a professor at the Wharton School whose background spans academia, entrepreneurship, and a stint at the U.S. Department of the Treasury as deputy assistant secretary for economic policy under the second Bush administration. Smetters also appears to operate a service connecting clients to financial advisors.
Both USAFacts and PWBM were in development well before Donald Trump won the presidency. But amid rising concern about the integrity of information of all kinds, these efforts have become a lot more timely.