What does a Budget mean?

On a recent Zoom meeting with Israeli Prime Minister Naftali Bennett, he shared that the main stumbling block in the formation of his government was the State Budget. We are also witnessing a serious fight in Congress here over the Budget. Why is this so important?

A Budget is, by definition, an intent of expense. The Budget tells everybody who reads it where the money will be spent, based on the priorities of the group preparing the budget. In Israel, the main budgetary issues were the amounts of social spending and the support for Arab municipalities (which have been receiving less support than the Jewish ones). There were also differences of opinions in subsidies for Yeshiva Students and New Olim.

In the US, the issues are many. Immigration, Health Care, Social Security, Corporate taxes, etc. Each party looks at each of these budget lines from a different perspective and prioritize them differently - so when it comes to decide how much to spend, they have different ideas. Another big difference is about the Administration's infrastructure proposal. The Democratic Administration looks at this not only as a need to keep the infrastructure in good shape, but also as a source of employment, much like the FDR Administration did during the Great Depression. The Opposition sees i as an expansion of the State at the expense of the Private Sector.

Much like in the "Big Stage" States and Legislators struggle with the prioritization of spending based on what they believe is most important to achieve, organizations do the same in the "small stage". An organization's budget is telling Donors and Volunteers where will the organization put its efforts; what is the intention in the group's priorities. In voluntary organizations, where Donors and Volunteers are many times one and the same, it is important that the budget reflect the priorities presented to the public when raising the money - because that is why people give.

A Budget is an instrument of Policy. Without a Budget there can be no oversight nor evaluation of performance. The Budget is not, like many people believe, a way of "Making the money work" to keep the organization going; ideally the Budget is a way of finding out the best way to spend the money to achieve the mission of the organization. We many times forget that...



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