Putting Trust in the US Budget
Federal Trust Funds and the Politics of Commitment

This book provided the first comprehensive study of a significant yet little-studied feature of the American welfare state.

Eric M. Patashnik (Author)

9780521777483, Cambridge University Press

Paperback, published 17 August 2000

246 pages, 17 tables
22.8 x 15.3 x 1.6 cm, 0.37 kg

'One can only admire the author's ability to explain so much, so lucidly.' Journal of Economic Literature

In the United States many important programs are paid from trust funds. At a time when major social insurance funds are facing insolvency, this book provided the first comprehensive study of this significant yet little-studied feature of the American welfare state. Equally importantly, the author investigates an enduring issue in democratic politics: can current officeholders bind their successors? By law, trust funds, which get most of their money from earmarked taxes, are restricted for specific uses. Patashnik asks why these structures were created, and how they have affected political dynamics. He argues that officeholders have used trust funds primarily to reduce political uncertainty, and bind distant futures. Based on detailed case studies of trust funds in a number of policy sectors, he shows how political commitment is a developmental process, whereby precommitments shape the content of future political conflicts. This book will be of interest to students of public policy, political economy and American political development.

1. Introduction: trust funds and the politics of commitment
2. Political transaction costs, feedback effects, and policy credibility
3. Trust fund taxes vs general fund taxes
4. Social security
5. Medicare
6. Highways
7. Airports
8. Superfund
9. Barriers to trust fund adoption: the failed cases of energy security and lead abatement
10. Conclusions: The structure and normative challenge of promise-keeping.

Subject Areas: Political economy [KCP]