My last three posts have discussed the long term damage that will be caused by excessive spending in the recently passed 2016 federal budget and what should be done about it. There is at least one way to force Congress to act in a responsible manner, namely, by putting into effect a Balanced Budget Amendment to the Constitution. Here is a brief history of recent efforts to do exactly this:
In the 1995-96 session of Congress, the House of Representatives passed (by a 2/3 vote) a BBA but it was defeated in the Senate by one vote.
Application by 34 states requires Congress to call a Constitutional Convention to propose an amendment. At the end of 2009, 16 states had so applied. Each year since one or more new states have also applied and now there are a total of 27. An additional 13 states are actively considering applications for a BBA at the present time.
As the number of applying states gets close to the required 34, it becomes more and more likely that Congress will act on its own in order to preempt a “Con-Con.” This would avoid the messiness and uncertainties of such a convention, none of which have yet occurred in our nation’s history.
Once 34 states have applied, however, Congress must call a convention. Any fear of a runaway convention, exceeding a limited mission, should be alleviated by the fact that any proposed amendment(s) have to be ratified by 38 states.
In my opinion a proposed amendment should have no restrictions on how a balanced budget will be obtained. There will be far more political pressure to cut spending than to raise taxes. Let Congress hash out the proportion of each.
Fiscal responsibility does not require the budget to be exactly balanced each year. In fact, temporary deficits can be useful as a stimulus in time of recession. However, deficit spending has gotten so far out of control in recent years that Congress must be forced to modify its behavior.
“The Congress, … , on the application of the legislatures of two thirds of the several states, shall call a convention for proposing amendments, which shall be valid to all intents and purposes, as part of this Constitution, when ratified by the legislatures of three fourths of the several states, or by conventions in three fourths thereof …”
Article V, The U.S. Constitution
As I pointed out in my last post, under the current 2016 federal budget, just adopted by Congress and signed by the President, our public debt (on which we pay interest) is now projected by the Congressional Budget Office to increase from 74% of GDP today to 175% of GDP in 2040, just 25 years from now.
Of course, a new, and more severe, financial crisis is likely to occur long before we hit such a high level of debt but this serves to emphasize the extreme seriousness of our present situation and the need to address it without delay.
The best and simplest way to do this is for Congress to act on its own accord to pass balanced budgets. In fact, the current Congress passed a multi-year budget plan last Spring which leads to a balanced budget in ten years, by 2025. But the budget just passed last week for 2016 totally ignores this plan and actually increases the deficit for 2016 by $158 billion.
In other words, Congress on its own accord appears incapable of acting in a fiscally responsible manner. As shown above, our founding fathers foresaw the possibility of congressional stalemate and provided for an alternative route to force Congress to act on critical issues. As reported by the Balanced Budget Amendment Taskforce, 27 states have already called for a Constitutional Convention out of the 34 needed to force congressional action.
In my next post I will discuss in detail the ramifications of holding a constitutional convention, pro and con.