In the context of recent economic and financial crisis in Europe, questions about the power of the core executive to control fiscal outcomes are more important than ever. Why are some governments more effective in controlling spending while others fall prey to excessive overspending by individual cabinet ministers? We approach this question by lifting the veil of collective cabinet responsibility and focusing on intra-cabinet decision-making around budgetary allocation. Using the contributions of individual cabinet members during budget debates in Ireland, we estimate their positions on a latent dimension that represents their relative levels of support or opposition to the cabinet leadership. We find some evidence that ministers who are close to the finance minister receive a larger budget share, but under worsening macro-economic conditions closeness to the prime minister is a better predictor for budget allocations. Our results highlight potential fragility of the fiscal authority delegation mechanism in adverse economic environment.

Public works spending was an integral component of John F. Kennedy’s fiscal policy. Drawing on a wide range of archival evidence from the Kennedy Presidential Library, we show how the administration worked to pass a $2.5 billion infrastructure bill that would give the presidency unilateral authority in determining where and when those funds would be spent. Contrary to recent accounts that emphasize Kennedy’s role in promoting massive tax cuts in 1963–64, the 1962 Public Works Acceleration Act was a key fiscal instrument that Kennedy advocated prior to the administration’s push for tax reform. Moreover, the public works policy was strictly Keynesian—designed as a proactive countercyclical “stabilizer” that would generate budget deficits in order to make up for slack in a recession. Kennedy’s plan faced stiff resistance in Congress and the history of the law offers important lessons for why infrastructure programs are often disregarded as countercyclical instruments.

Scholars of political parties frequently note that a party's candidates are aided by the presence of a consistent and favourable party brand name. We argue that partisan success in maintaining a consistent position on important policy issues hinges on how their role in the government motivates their strategies about public policy formation. Specifically, when parties share control of government institutions, parties need to balance their electoral interest in promoting a consistent brand name with the need to generate public policy that leads to effective governance. When control is held by one party, the costs and benefits of effective governance are born entirely by the majority, absolving both parties of the need to compromise on the substance of policy. By employing item response theory methods to assess patterns of party voting on deficit issues, we find strong support for these hypotheses.