Members of the Senate Budget Committee must have been bemused last week as Alan Greenspan lectured them about needed changes in federal budget laws. As chair of the Federal Reserve Board, Mr. Greenspan has no authority over any part of the federal budget.

Mr. Greenspan advised Congress that the budget deficits caused by a lack of budgetary cohesiveness could cause the national economy “to stagnate or worse.” On that point he is correct. Budget reform policy is near to Mr. Greenspan’s heart but distant from his power to influence.

The federal budget process is broken. Spending and taxes grow faster than the economy in most years. Future obligations such as Social Security and Medicare grow even faster. Whether spending or taxes grows more than the other is a matter not so much of governmental control as coincidence.

Mr. Greenspan’s proposed solution lies partly in reviving arcane Congressional procedural rules such as the Budget Enforcement Act of 1990, which largely expired in 2002. The year 1990 was one of modest budget deficit; the year 2002 was once proclaimed part of budget surpluses “as far as the eye can see.” In budgetary parlance, 2002 actually was yet another deficit year.

While Mr. Greenspan’s advice is carefully considered, it would have little practical effect even if Congress were inclined to listen to it. Congress has long known how to circumscribe federal budget rules, including those recommended by Mr. Greenspan.

Today we have a growing budget deficit. It was a record $412 billion in fiscal year 2004 and is projected to grow to $427 billion in fiscal year 2005. While these numbers by themselves are manageable in a $12 trillion economy, there is little optimism that the deficit will shrink soon.

The growth in future obligations is more disturbing. As Mr. Greenspan noted, Social Security and health care “commitments” to the baby boom generation may be financially unsustainable. The unfunded future liability of the federal government is not fully reflected in the federal budget.

Congress accords different treatment to public accounting numbers. To counter occasional but large-scale fraud in the accounting records of publicly traded financial securities, Congress enacted the Sarbanes-Oxley law, which imposes substantial and inescapable costs on public corporations. Yet congressional reaction to misleading federal budget numbers is calculated neglect. Congress has made corporate boards responsible for their financial information, but who is responsible for federal financial information?

As a matter of political convenience, no one is individually responsible: not the president and not any individual or small group in Congress.

Congress did not always work this way. Before 1974, six individuals – the leaders of each house, the two chairmen of the appropriations committees, and the two chairmen of the taxation committees – could and would establish the contours of the next year’s budget. An adviser to the president might be invited to the meeting depending on the prevailing politics of the day.

In the 185 years before 1974, the budget process of this unofficial group of congressional titans usually yielded nearly balanced federal budgets except in times of war or national crises. The Congressional leaders held themselves accountable. If the budget were profoundly out of line, there would be no one to blame but themselves.

In 1974, Congress passed the Budget Impoundment and Control Act. The law created a complex congressional budget process. It mandates rarely realized budget resolutions and deadlines. The text of the law and its rules are unfamiliar to most members of Congress.

The law was partly intended to ensure balanced budgets. It has had the opposite effect. The law has no effective enforcement mechanisms. No one is held responsible; our economy suffers as a consequence. Since 1974, federal entitlement programs and future “commitments” have grown unsustainably. Future generations will pay for our profligacy.

Mr. Greenspan and others suggest modest tweaks to the Rube Goldberg contraption known as the federal budget process. Without care, the situation can easily get much worse. We can and must do better. A new federal budget process should rely on three principles: constitutionality, enforceability, and political accountability.

Our current system has at most one of these, namely constitutionality. Until congressional leaders reassert responsibility for the integrity of the federal budget, we will collectively suffer the consequences.

A former FCC commissioner,Mr. Furchtgott-Roth is president of Furchtgott-Roth Economic Enterprises. He can be reached at hfr@furchtgott-roth.com.