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Fulfilling the demand of conservatives... the recent debt ceiling agreement contains a provision that has the potential to help right our course: a requirement that Congress vote on a constitutional amendment requiring a balanced budget – a common sense requirement already in place in 49 states.
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| With the prolonged debate over the debt ceiling finally having concluded earlier this week, many Americans are anxious to leave the divisive and exhausting disputes over our nation’s economic future behind. Reality, however, offers us no such luxury.
While the compromise that ended the debt ceiling impasse may save a few trillion dollars in the rosiest of scenarios, that’s a trifling amount given the scale of America’s debt crisis. Under current estimates, national debt will grow to nearly 350 percent of GDP by 2050 without serious policy reform. That means our outstanding liabilities will be greater than the amount the entire American economy produces in nearly three and a half years.
Fulfilling the demand of conservatives, however, the recent debt ceiling agreement contains a provision that has the potential to help right our course: a requirement that Congress vote on a constitutional amendment requiring a balanced budget – a common sense requirement already in place in 49 states.
By itself, of course, a balanced budget amendment is no panacea. Budgets can be balanced just as easily through massive tax increases as they can through spending cuts. But the proposed version of the amendment anticipates this danger, requiring a two-thirds majority of the Congress to vote for any new tax increases.
This should be an intuitively appealing prescription for public finance: keep your books balanced with as little pain to the taxpayer as possible. Yet as the balanced budget amendment has gained momentum, liberal critics have come out of the woodwork to attack it.
The left usually begins by touting the fact that Bill Clinton achieved a balanced budget – and that he did so without a balanced budget amendment. Clinton’s success at generating surpluses, however, grew out of two factors beyond his control – a booming economy and a Republican congress pushing fiscal discipline (Clinton ran deficits in the years his liberal colleagues controlled Capitol Hill).
Nor is Clinton’s example particularly representative of the broader trajectory of federal spending. In the 80 year period from 1930 to 2010 (the period of the longest prolonged growth of government in American history), there were only 14 years when the federal budget wasn’t in deficit. With that track record in mind, we can safely conclude that leaving politicians to their own devices won’t do anything to solve this crisis.
Liberals such as New York Senator Chuck Schumer also claim that the balanced budget amendment represents a fantasy from conservatives on the “ideological fringe.” But if anyone is occupying the margins of public opinion, it’s Schumer and his ilk. A CNN poll conducted in July showed 74 percent of the public in favor of the proposed amendment. It turns out that the group Senator Schumer refers to as the fringe actually represents three out of every four Americans.
The left also bays that the balanced budget amendment misplaces America’s fiscal priorities, because it does not do enough to enforce “shared sacrifice” – i.e., it makes it more difficult to raise taxes. But sacrifice shouldn’t be shared equally between a rapacious government and a battered private sector. Taking more money out of an already crippled economy would only slow the nation’s return to economic health. Returning that money to taxpayers in the form of spending cuts would have precisely the opposite effect.
Finally, critics charge that the amendment is a worthless pursuit because it would take years to be ratified by the states and given the force of law. While it’s true that the road to adoption is time-consuming, that’s hardly an argument against it. Imagine if a balanced budget amendment had passed out of the Congress in 1997, when it fell only one vote short in the Senate. Even if it had taken five years to ratify, it would have still been in place by 2002, long before the Medicare prescription drug benefit, TARP, the auto industry bailout, the stimulus package and Obamacare. And America wouldn’t be reeling from the trillions of dollars in debt piled on by those programs.
If the balanced budget amendment can stave off that kind of reckless spending in the future, it’s worth the wait. |
