Americans are right to be skeptical of constitutional amendments. When politicians ask us to amend the U.S. Constitution, they are asking us to trust their judgment over the Founding Fathers. That should not be done lightly.
I believe, however, that it is time for the United States to amend the Constitution to remove Congress’ power to overspend. The federal government currently spends approximately 170 percent of its income. That’s like a person with an annual salary of $50,000 spending $85,000 each year. Unless that person has substantial personal savings (Congress does not), even a single year of such behavior would be reckless. Decades of such behavior inevitably leads first to a reduced credit score and, eventually, to financial ruin. Congress has already earned a reduced credit score, but Congress nonetheless plans to increase its spending over time.
While it is easy to blame parties, interest groups, and politicians for the failure to control spending, the problem is deeper: Experience shows that when deficit spending is an option, no legislature will consistently balance its budget. This is not a partisan problem.
President George W. Bush and a Republican Congress increased the annual deficit at an astonishing pace, and that trend only worsened under President Barack Obama and a Democratic Congress. Nor is this strictly an American problem. Look at Greece, Ireland, Spain, Italy, France, Portugal and the United Kingdom — to name only a few prominent examples currently in the headlines. Each is struggling under the weight of government overspending. The point is that as long as overspending is an option, no legislature will control its spending over time.
In America, all the non-constitutional solutions to this problem have failed. We have tried electing individual politicians who oppose overspending, but most have not resisted the temptation. We have tried electing coalitions of politicians to control overspending — in 1994 and 2010, for example — but the coalitions have failed to pass long-term solutions. We have attempted statutory fixes — the line-item veto in 1996, for example — but those measures have been invalidated or ineffective. Even the Tea Party movement, which had tremendous success campaigning on fiscal austerity, has so far failed to cut federal spending. (The recent budget “cuts” are relatively minor reductions in planned spending increases.) It’s not that we haven’t tried the non-constitutional solutions, or that we tried them in unfavorable election cycles. Legislatures simply cannot resist overspending as long as overspending is an option.
The solution, then, is to eliminate the option of overspending. On the federal level, this requires a constitutional amendment prohibiting Congress from spending more than it collects. Based on the experiences of individual states, this appears to be a reasonably strong solution to the problem of overspending. Every state except Vermont currently has some form of a balanced budget amendment and, while most states overspend, no state expects a 2012 deficit that approximates the federal deficit as a percentage of total government spending.
The devil is in the details. A balanced budget amendment should be drafted to require true balance and not “paper” balance through accounting gimmicks. Balance probably should be phased in over several years to prevent sudden economic and employment dislocations. And politicians on both sides of the aisle point out, correctly, that Congress should be permitted to fund war or genuine emergencies through deficit spending. Care must be taken to draft the amendment so that such exceptions do not swallow the rule, but I see no reason why that is not possible.
Under the terms of the recent debt ceiling deal, Congress must vote by the end of the year on whether to refer a balanced budget amendment to the states for ratification. (Oddly, the deal contains a perverse incentive: If Congress approves the amendment, the federal government will be authorized to borrow an additional $300 billion. Sure, that may be small for Congress, but it’s an astounding sum standing alone.) Most commentators expect Congress to reject such an amendment.
Mercifully, we need not rely on Congress to amend the U.S. Constitution. Under Article V, there is a process for the states to add an anti-deficit rule to the U.S. Constitution without congressional approval. In the history of the nation, the people have never bypassed Congress to amend the U.S. Constitution — but these are extraordinary times, so don’t dismiss the possibility too quickly.
— Kory A. Langhofer practices election law at Snell & Wilmer, L.L.P. in Phoenix.