ABSTRACT
From a macroeconomist’s perspective, the central issue surrounding fiscal policy has traditionally been its efficacy as a tool for stabilization. This focus on aggregate activity typically has led to a parallel concentration on fiscal aggregates: revenues, spending, and deficits. But a focus on aggregates masks significant changes that have occurred over the postwar years in US fiscal policy. Some of these changes, in turn, have consequences for the practice of stabilization and budget policy. Given the continuing evolution in the composition of revenues and spending, a look below the surface will provide some insight into the future challenges to the practice of fiscal policy.
