Some Possible Balanced Budget Amendments
In the Federal debt-ceiling deal passed yesterday, as an alternative in phase II to a specific program cuts projected to cut spending by 1.2 trillion dollars, the debt-ceiling can be raised by 1.5 trillion dollars if Congress sends a balanced budget amendment to the US Constitution to the states for ratification. This raises the question of what a reasonable balanced budget might look like.
Here is a version of a balanced budget amendment that was reported out of a House Committee earlier this year…
Section 1. Total outlays for any fiscal year shall not exceed total receipts for that fiscal year, unless three-fifths of the whole number of each House of Congress shall by law for a specific excess of outlays over receipts by a rollcall vote.Balanced budget amdenments have been introduced to Congress, on a regular basis, for the past 30 years. This is the text of balanced budget amendment passed by the US Senate in 1982…
Section 2. Total outlays for any fiscal year shall not exceed 18 percent of economic output of the United States, unless two-thirds of each House of Congress shall provide for a specific increase of outlays above this amount.
Section 3. The limit on the debt of the United States held by the public shall not be increased unless three-fifths of the whole number of each House shall provide by law for such an increase by a rollcall vote.
Section 4. Prior to each fiscal year, the President shall transmit to the Congress a proposed budget for the United States Government for that fiscal year in which total outlays do not exceed total receipts.
Section 5. A bill to increase revenue shall not become law unless two-thirds of the whole number of each House shall provide by law for such an increase by a rollcall vote.
Section 6. The Congress may waive the provisions of this article for any fiscal year in which a declaration of war is in effect. The provisions of this article may be waived for any fiscal year in which the United States is engaged in military conflict which causes an imminent and serious military threat to national security and is so declared by a joint resolution, adopted by a majority of the whole number of each House, which becomes law.
Section 7. The Congress shall enforce and implement this article by appropriate legislation, which may rely on estimates of outlays and receipts.
Section 8. Total receipts shall include all receipts of the United States Government except those derived from borrowing. Total outlays shall include all outlays of the United States Government except for those for repayment of debt principal.
Section 9. This article shall take effect beginning with the later of the second fiscal year beginning after its ratification or the first fiscal year beginning after December 31, 2016.
Section 1. Prior to each fiscal year, the Congress shall adopt a statement of receipts and outlays for that year in which total outlays are no greater than total receipts. The Congress may amend such statement provided revised outlays are no greater than revised receipts. Whenever three-fifths of the whole number of both Houses shall deem it necessary, Congress in such statement may provide for a specific excess of outlays over receipts by a vote directed solely to that subject. The Congress and the President shall, pursuant to legislation or through exercise of their powers under the first and second articles, ensure that actual outlays do not exceed the outlays set forth in such statement.And although it’s never been formally introduced in Congress as far as I know, Georgetown University Law Professor Randy Barnett has proposed a Constitutional amendment that takes an intriguing approach to the balanced budget problem…
Section 2. Total receipts for any fiscal year set forth in the statement adopted pursuant to this article shall not increase by a rate greater than the rate of increase in national income in the year or years ending not less than six months nor more than twelve months before such fiscal year, unless a majority of the whole number of both Houses of Congress shall have passed a bill directed solely to approving specific additional receipts and such bill has become law.
Section 3. The Congress may waive the provisions of this article for any fiscal year in which a declaration of war is in effect.
Section 4. Total receipts shall include all receipts of the United States except those derived from borrowing and total outlays shall include all outlays of the United States except those for repayment of debt principal.
Section 5. The Congress shall enforce and implement this article by appropriate legislation.
Section 6. On and after the date this article takes effect, the amount of Federal public debt limit as of such date shall become permanent and there shall be no increase in such amount unless three-fifths of the whole number of both Houses of Congress shall have passed a bill approving such increase and such bill has become law.
Section 7. This article shall take effect for the second fiscal year beginning after its ratification.
Section 1. The budget of the United States shall be deemed unbalanced whenever the total amount of the public debt of the United States at the close of any fiscal year is greater than the total amount of such debt at the close of the preceding fiscal year.More to come from Anchor Rising and, rest assured, elsewhere.
Section 2. Whenever the budget of the United States is unbalanced, the President may, during the next annual session of Congress, separately approve, reduce or disapprove any monetary amounts in any legislation that appropriates or authorizes the appropriation of any money drawn from the Treasury, other than money for the operation of the Congress and judiciary of the United States.
Section 3. Any legislation that the President approves with changes pursuant to the second section of this Article shall become law as modified. The President shall return with objections those portions of the legislation containing reduced or disapproved monetary amounts to the House where such legislation originated, which may then, in the manner prescribed in the seventh section of the first Article of this Constitution, separately reconsider each reduced or disapproved monetary amount.
Section 4. The Congress shall have power to implement this Article by appropriate legislation; and this Article shall take effect on the first day of the next annual session of Congress following its ratification.
And because Congress so loved to “earmark” amendments on to bills that were completely unrelated, I’d like to do the same.
Section 8: No person may serve more than 12 years in either the US Senate or US House of Representatives or any combination of terms in the US House of Representatives or US Senate may not exceed 12 years, consecutive or otherwise.
Term limits. Be done with it.
Lets make the receipts backward looking. This years budget can’t exceed last years receipts. Otherwise Congress will just lie about projected receipts. Alternatively, use a loss carry forward. This years budget can’t exceed the projected receipts less the prior year’s loss. I like the backward looking idea better, though. Profit carry forward can’t be applied until the debt is fully paid off.
Chuck, it’s not a bad idea, except for one of two things:
1. You need to get ahead by a year. You’d need to simply not spend a single penny while you take in money for a whole year. Then you’ll know how much you have to spend.
Or
2. If you actually take in less than the previous year, you’re running a deficit. I would guess that eventually you’ll catch up, but what if there are multiple years of decreases in income? It could take a long time to catch up. Then again, maybe it wouldn’t be nearly as bad as the current deficit spending.
I would structure the amendment so that it would mandate a surplus in good years rather than an annual balanced budget. If if said something along the lines of “the US must maintain a budget surplus in percent of GDP equal to 6% minus the unemployment rate” we would have larger surpluses in better years, small surpluses in okay years, and automatically run small deficits in bad years. The budget would be balanced when unemployment is at 6%, but would be counter-cyclical otherwise.
Balanced budget amendment doesn’t accomplish she-it.
Progressives just float bonds and call the budget “balanced” as long as they can make the interest payments.
You need to limit spending to a fixed percent of GDP. Say 20 or 21 percent.
Balanced budget amendments have been passed in several states and have been unsuccessful – too many accounting gimmicks and “alternative revenue sources” available to get around them. It would have to prevent all the progressive-Democratic spendaholic fiscal shenanigans.
Barnett’s BBA is genius. Seriously, as someone who respects the founders intent and the powers that they intended, this truly respects that and is FAR superior to the BBA’s coming out of Congress today.
It also puts the onus on the POTUS. Genius.
Barnett’s BBA is genius. Seriously, as someone who respects the founders intent and the powers that they intended, this truly respects that and is FAR superior to the BBA’s coming out of Congress today.
It also puts the onus on the POTUS. Genius.
Other Dan – You want to take a new handle or should I?