A Skeptics View of a Balanced Budget Amendment

The idea of a balanced budget amendment is coming up quite a bit this election cycle. This seems to be good political fodder to the masses that want the Federal Government to be fiscally responsible. On the surface such a policy seems like a good idea, but I have my doubts about a balanced budget amendment.

It is important that a nation be able to have credit and borrow money for situations that require large amounts of funds. One glaring example is in the event of war, another is a large natural disaster or epidemic that requires large scale relief and mobilization. There are of course others that are conceivable. This need causes a dilemma in a balanced budget amendment. Even if the proposed amendment were to have specific clauses to allow for borrowing in a time of war, or war like action, approved by congress, such a clause doesn’t go far enough. If such an amendment were to include an elastic clause that allows for borrowing at congressional discretion due to unforeseen events, such as a natural disaster, epidemic, or financial crisis, this clause would essentially put us where we are now. It could be argued that a large plurality could be necessary to approve borrowing. This may have the effect of mitigating abuse of Congresses ability to borrow, but it also allows for a minority to filibuster any progress. An elastic clause is too elastic to make a balanced budget amendment useful.

The primary purpose of our Congress is to establish policy and fund the implementation of policy. Fiscal responsibility is valuable, and should be practiced by Congress, but this is a normative statement. The necessary role of Congress is to keep government running. If fiscal responsibility is very important to the American people, then it is incumbent upon us to give both Congress as a whole, and individual members of Congress incentive to exercise fiscal responsibility. Right now the only way to do this is to be cautious about re-electing incumbents who might have failed to act in the fiscal interests of the nation.

In the private sector if a business owner were to task a group of his financial employees to create a working budget that was agreeable by a certain deadline, and they were unable to do so, their jobs would be in jeopardy. It is time that the Congress is held to the same standard. I propose that if Congress cannot pass a working budget every fiscal year, by a very specific deadline, that each sitting Congressman and Congresswoman will be ineligible to run for re-election, without exception.

This would ensure that at the very least Congress is performing their primary function of funding the government through budgeting, rather than appropriation, and in the event that they do not a new Congress can.