In yesterday’s Wall Street Journal Senators Snowe and DeMint wrote an opinion piece (subscription req’d) which points out that none of today’s budget negotiations offer anything like a long-term cure for the fiscal irresponsibility that has become the norm in Washington, DC. They argue that this goal is best achieved via a balanced-budget amendment to the Constitution, and remind us that the Senate last considered this measure in 1997—when the nation’s debt was just $5.36 trillion. The amendment passed the House, and failed in the Senate by a single vote.
A misinformed New York Times writer immediately jumped on his keyboard to ask what would have happened in 2009 if we’d had this amendment in place. Would Congress have been forced to cut spending programs and raise taxes as IRS tax receipts shriveled? If he had bothered to read the language of the four balanced-budget amendment proposals in the Senate he would have learned that each offers Congress an opportunity to override the amendment by super-majority vote. In 2009 that vote surely would have passed.
In truth the amendment would have been overriden in other years, such as the years when the deficit was enlarged by war and tax cuts. But the need to annually override the Constitution would have weighed heavily. In just two or three years the supermajority would have crumbled and fiscal responsibility would have returned. Instead of starting with $10 trillion in debt and running it up to $14.4 trillion, the 2009 Congress might have started with 7 or 8 trillion in debt, and run it up to $10 trillion. And instead of starting with an economy that had already been overstimulated for years (and thus less-receptive to the arguable effects of stimulus), we would have started 2009 with a leaner government and a more-or-less balanced budget. We don’t know whether the economy would have given a warmer welcome to the added government spending, but we DO know that we wouldn’t now be worrying about a threat of sharply-rising interest rates, trillion-dollar annual interest costs, and calamity for the US and for the entire planet.
Postscript to those who worry that a balanced-budget amendment (“BBA”) would simply force tax increases whenever spending got out of control: All four of the BBA bills in Congress(http://weelectedyou.org/2011/04/the-farmer-and-the-lottery/ ) would put a cap on federal spending. Two set the cap at 20% of GDP, and two set it at 18% of GDP. Democrats would like to see a higher percentage.
Let the debate begin, because this is the core issue. How much can we afford to spend, and how much do we want to raise in taxes? Right now Washington is in an uproar because individual groups of voters are being targeted for spending cuts or tax increases—and none of them are happy about it! It makes a lot more sense to budget those amounts first, and then fit our spending and taxation to the budget.