Balanced-Budget Amendment

Originally posted by wittywonka
I know this discussion is unoriginal, but perhaps in the context of the United States’
potentially imminent default it might deserve reconsideration.

Should the U.S. adopt a balanced-budget amendment?

I don’t think the proposition is unreasonable so long as provisions for
extraordinary circumstances exist such that a congressional supermajority co ...[text shortened]... ngly legitimize arguments to support tax increases and spending decreases
equally.

Thoughts?

No

Originally posted by badmoon
No

Care to elaborate?

Originally posted by wittywonka
Care to elaborate?

The federal government must have the ability to be flexible. What do we do when the next Katrina event happens? We need the abilty for stimuls in times of recession and of course war. On the other hand we have what Jefferson wrote:

"I wish it were possible to obtain a single amendment to our Constitution. I would be willing to depend on that alone for the reduction option of spending beyonf our apparent means. of the administration of our government; I mean an additional article taking from the Federal Government the power of borrowing. I now deny their power of making paper money or anything else a legal tender. I know that to pay all proper expenses within the year would, in case of war, be hard on us. But not so hard as ten wars instead of one. For wars could be reduced in that proportion; besides that the State governments would be free to lend their credit in borrowing quotas.:

But then Jefferson was in on the Louisiana Purchase so even he enjoyed the option of spending beyond the apparent means.

Originally posted by badmoon
What do we do when the next Katrina event happens? We need the abilty for stimuls in times of recession and of course war.

Again, as I've said already, a balanced-budget amendment would only be legitimate if it took into account scenarios like those you propose:

so long as provisions for extraordinary circumstances exist such that a congressional supermajority could overrule the requirement.

I think such an amendment is only legitimate with the existence of a clause to allow for certain exceptions

With regards to responding to natural disasters, I think your kind of exception would be reasonable...With regards to responding to economic decline, though, I think that there should be a means of [overruling the requirement]...An exception for times of war is also probably necessary

Originally posted by wittywonka
Again, as I've said already, a balanced-budget amendment would only be legitimate if it took into account scenarios like those you propose:

so long as provisions for extraordinary circumstances exist such that a congressional supermajority could overrule the requirement.

I think such an amendment is only legitimate with the exi ...[text shortened]... [overruling the requirement]...An exception for times of war is also probably necessary

The paper I referenced in my other reply to the OP is worth quoting at some length. Note that it deals with a specific proposed amendment.

" ... One of the similarities between the balanced budget amendments at the state level and at the federal level is the above-mentioned "smoke and mirror" tactics. Savage (1988:237) analyzed four devices developed by the state governments to sidestep their constitutional restrictions to balance the budget while accommodating their new borrowing needs necessitated mainly by the "internal improvements" such as highway construction. The four kinds of non-guaranteed borrowing are: (1) state agency revenue bonds; (2) borrowing through public corporations, commissions, and authorities; (3) delegating state operations to local governments and agencies; and (4) lease-purchase agreements. Gramlich (1995:180) holds that all real-world balanced budget amendments have significant enforcement problems. Nothing in principle, not even a constitutional amendment, could prevent the states or the federal government from selling assets, changing paydays, moving items off-budget, etc.. There are different views about these enforcement problems, though. Poterba finds that even with those "tricks", constrained state fiscal policy is more responsible than unconstrained state fiscal policy.

A critical difference between the proposed federal balanced budget amendment and those of the states is the treatment of capital budgets. Ross finds that even the most stringent state provisions allow the use of bonded indebtedness as a tool for financing capital investments, such as highways, airports, and public buildings, while the balanced budget amendment proposal requires financing capital investments on a pay-as-you-go basis. As Gramlich pointed out, these also raise enforcement problems. There are a number of measurement problems in defining federal investment, and a number of political problems in enforcing any definition, however sensible.

Still another major difference between the constitutional amendment and state balanced budget requirements, as Iris Lav and Robert Greenstein (1997) point out, is the use of "rainy day" funds. Most states have established reserve funds that can be drawn upon when their budgets would be otherwise out of balance, while the proposed constitutional amendment lacks this mechanism. Gramlich also calls attention to this and proposed that the federal balanced budget amendment should learn from this "nice way to deal with the problem" by the states.
...

The above discussions of the balanced budget amendment show that this amendment would have mixed results. Despite the beneficial consequences that the proponents have ascribed to it, the enforcement of it still poses problems. The rigidity of the amendment provisions and the tactics employed by the Government to sidestep them might affect not only the operation of the amendment, but also, what is worse, the credibility and authority of the Constitution itself."

Originally posted by spruce112358
So what is our excuse today? What crisis are we facing? We aren't under attack, we aren't threatened.

Is the US being attacked from within perhaps?

I know, I know, tin foil blah, blah, blah.

Originally posted by whodey
Is the US being attacked from within perhaps?

I know, I know, tin foil blah, blah, blah.

Which government officials or politicians do you think want to "attack" the U.S.?

Originally posted by wittywonka
Which government officials or politicians do you think want to "attack" the U.S.?

Perhaps the ones leading the charge to ecnomic ruin.

Originally posted by whodey
Perhaps the ones leading the charge to ecnomic ruin.

So you think this is an active effort on behalf of certain politicians? On behalf of all politicians? You think that certain politicians have specific, anti-America agendas?

I think this is a classic difference in world-views in practice. I agree in that I believe some government officials have logistically flawed goals regarding how to solve the country's problems, but I disagree in that I believe that, by and large, their intentions are still good.

Originally posted by wittywonka
So you think this is an active effort on behalf of certain politicians? On behalf of all politicians? You think that certain politicians have specific, anti-America agendas?

I think this is a classic difference in world-views in practice. I agree in that I believe some government officials have logistically flawed goals regarding how to solve the co ...[text shortened]... problems, but I disagree in that I believe that, by and large, their intentions are still good.

I think those in office are petty and short sided. Their largest focus is just getting re-elected, and if your lucky look only 10 years down the road regarding reprocussions for your actions. The attitude seems to be just to hold things together until the next election. Even Obama said that the current fiscal trajectory of the government is not sustainable, yet he does not flinch.

Originally posted by whodey
I think those in office are petty and short sided. Their largest focus is just getting re-elected, and if your lucky look only 10 years down the road regarding reprocussions for your actions. The attitude seems to be just to hold things together until the next election. Even Obama said that the current fiscal trajectory of the government is not sustainable, yet he does not flinch.

I agree here, too, in that I think the government is by far more reactive than proactive, but again I can't seriously argue that this fact is a result of politicians' un-American attitudes or utter selfishness. I think it is more a product of the political system.

Originally posted by wittywonka
I agree here, too, in that I think the government is by far more reactive than proactive, but again I can't seriously argue that this fact is a result of politicians' un-American attitudes or utter selfishness. I think it is more a product of the political system.

It's a result of the political system? How so?

Originally posted by whodey
It's a result of the political system? How so?

The judicial system is intrinsically reactive; after a law has taken effect, the courts react to determine whether somebody is in violation of the law, or whether the law is legitimate in the first place.

Congress and the presidency will always struggle with gridlock (especially under divided government), and so typically only after a policy's efficacy or legitimacy is widely agreed upon will any sort of action occur.

The creation of the FDA (something I recently read up on) is a good example. For a while, the government didn't carry out any sort of regulation on individuals' marketing of "drug" products; you could market a product that was 99.9% water or 99.9% antifreeze as a cure for whatever disease you wanted and nobody could stop you. Only after widespread public backlash followed did the government finally start formalizing drug regulations; it initially either lacked the will or the foresight to adopt similarly proactive policy.

I'll grant you (backtracking a bit from what I said earlier) that the systemic problem of gridlock is the result--to a degree--of special or personal interests and a tendency to capitalize on the status quo. But I am not convinced that those factors always stem from malicious intent.

Originally posted by wittywonka
The judicial system is intrinsically reactive; after a law has taken effect, the courts react to determine whether somebody is in violation of the law, or whether the law is legitimate in the first place.

Congress and the presidency will always struggle with gridlock (especially under divided government), and so typically only after a policy's e ...[text shortened]... status quo. But I am not convinced that those factors always stem from malicious intent.

I view the problem as Big Government in bed with Big Business. Basically you have corporate America buying federal politicians who become entrinched.

The answer? Reduce the size and power of the federal government and increase the power of the states. Then multiply the number of state politicians to the mix that corporate America has to buy off. Although it would not stop the task would be much, much more daunting and impracticle.

Originally posted by whodey
I view the problem as Big Government in bed with Big Business. Basically you have corporate America buying federal politicians who become entrinched.

The answer? Reduce the size and power of the federal government and increase the power of the states. Then multiply the number of state politicians to the mix that corporate America has to buy off. Although it would not stop the task would be much, much more daunting and impracticle.

Decentralizing power even more would generate smaller (easier) targets for "Big Business" to cozy up to.