A Look at a Proposed US Constitutional Amendment

Last month, the House Committee on the Judiciary reported House Joint Resolution 1, Proposing a balanced budget amendment to the Constitution of the United States.  It has received practically no media coverage since it was introduced, though that could be because the focus is on the debt ceiling negotiations.

A rule respecting balanced budgets is not at all a bad thing; we are seeing the American economy being pushed down by its $14.3 trillion debt.  However, this has absolutely zero hope of becoming part of the Constitution unless some fundamental issues are addressed.


The first implied rule of a constitutional amendment is that it must have bipartisan support.  This amendment is very consistent with the Republican policy that the government is over-spending and not under-taxing, and Democrats fundamentally disagree with this view.  The second rule is that it should not micro-manage, but rather give a broad overview of what should be done.  Some of the requirements set out in this amendment, including a cap on federal spending and tougher requirements to raise taxes, could be considered micro-managing.

The amendment would call for federal spending to not exceed 18% of GDP, which would require Congress to cut 25% of its current spending.  On the surface, that would not be considered a tall order, but when you consider that Social Security and Medicare count towards this (at least by my interpretation), and those obligations are expected to increase as baby boomers continue to retire, that makes it even more difficult to get down to 18%.

What will make things even more difficult still would be the proposed tougher requirement to increase taxes.  The amendment would call for a two-thirds vote of each house in order to pass any bill that increases revenue.  At the moment, federal revenue is approximately 14% of GDP, though that is projected to increase to 18% as the economy continues to recover.  This means that any tax increase would require bi-partisan support in order to happen, which means it will never happen so long as Republicans have any political influence.  This would make it difficult for the US to raise enough money to pay the likely 18% GDP that they'll budget as well as pay off the debt (though paying off the debt would give more spending room underneath the 18% limit).

It would be unwise to prohibit deficits full stop, which is why I'm glad that the amendment would permit a deficit with a three-fifths vote (in, say, a time of economic uncertainty) or during wartime (where deficits can easily reach 25% of GDP).  However, what struck me as odd was that this amendment can be overridden by a simple majority in each house saying there's an imminent threat to national security.  While I agree that exemption should be there, the threshold to reach it is way too low and really renders this amendment pointless.  If there were a true and serious threat to national security that would require additional spending, there would be no problem getting a two-thirds vote to authorize additional spending, and that makes me think this would be a more reasonable threshold.

If this amendment simply said that Congress couldn't authorize a deficit without a two-thirds vote, that would probably have the bi-partisan support it would need to become part of the Constitution.  As long as it provides the restrictions on spending and taxation that it does, though, it would not have enough Democratic support to go anywhere.