New Issue Brief: How to Fix the Senate’s Broken Budget Process

Reforming the “Byrd Rule” and prioritizing fiscal responsibility

NEW YORK, NY – The end to the longest government shutdown is finally in sight, but the process only underscores Washington’s deep political dysfunction, particularly concerning the federal budget.

In a new issue brief, Manhattan Institute fellow Robert VerBruggen proposes several ways to improve Congress’s approach to spending and taxation—and more specifically, to fix the “reconciliation” process, which allows a Senate majority to avoid a filibuster on certain budget bills. Most recently, lawmakers used this process for the One Big Beautiful Bill Act earlier this year. VerBruggen argues that this process was once intended to promote fiscal discipline but has instead become a tool for partisan legislation that worsens deficits. 

VerBruggen explains how both parties have used reconciliation to advance costly tax cuts and spending programs, often under opaque interpretations of the Byrd Rule, which determines what provisions qualify for inclusion in fast-track budget legislation. He argues that the current framework should be amended to restore transparency, reestablish limits on deficit increases, and realign congressional incentives toward responsible budgeting. 

VerBruggen's recommendations include: 

• Requiring that reconciliation bills use a current-law baseline and a maximum 10-year budget window; 

• Limiting reconciliation to deficit-reducing measures by codifying the defunct “Conrad Rule”; 

• Mandating full transparency from the Senate parliamentarian on Byrd Rule determinations; 

• Allowing automatic fiscal “triggers” to enforce promised deficit savings; and 

• Experimenting with procedural incentives for bills that meaningfully reduce the deficit. 

As Congress once again struggles to end the shutdown and fund the government, VerBruggen’s analysis underscores that the roots of dysfunction go deeper than any single policy fight. Without structural reforms, VerBruggen warns, Congress will continue to rely on obscure budget rules and short-term fixes that enable partisan politics and worsen the nation’s fiscal outlook. 

Click here to read the full issue brief.