The Citizens Budget Commission was founded in 1932 by a group of merchants, bankers, real estate executives, and civic associations to advocate reductions in the costs of city government and study possible sources of new revenue. The economic strain of the Great Depression had hurt municipal government across the nation, and especially in New York City, where public revenues were severely impacted by business failures. Among the founders were Nicolas Murray Butler, Henry Morgenthau, William Church Osborn, Vincent Astor, John W. Davis, and R. Fulton Cutting, who characterized their vision of the Commission as “the most comprehensive effort at budget control in the history of New York.” These individuals felt that it was the responsibility of citizens through organized research to propose sources of revenue to the administration of Mayor Jimmy Walker.
In its early years of operation, CBC focused on three main objectives: first, curbing the level of municipal spending, which had outpaced the growth of revenues; second, negotiating credit arrangements that could stave off municipal bankruptcy; and third, working toward permanent change in certain unsound fiscal practices. In 1933 CBC began making presentations to the City Budget Director, which were well-received by policymakers like Mayor Walker, who promised his cooperation with its efforts. In part due to the Commission’s recommendations, the City budget was reduced from $629 million to $518 million, earning CBC widespread support from the public and media. The organization also played a key role in the formation of the Bankers’ Agreement, which allowed the City continued access to short-term credit and provided lending banks with insurance against default.
In 1984, motivated by concern about deficit spending and swollen short-term borrowing, CBC expanded its analysis to the activities of New York State government. Throughout its history, CBC has continually weighed in on relevant and pressing issues surrounding the City’s and State’s budget and finances and has acted as a credible and reliable voice for responsible and effective public policy.