John Brummett in his article “It may get personal in debt-limit end game,” Arkansas News Bureau, July 19, 2011 noted:

The White House is quietly encouraging the Reid-McConnell talks.

Meantime, there is talk of pandering to the tea party radicals in the unwieldy House by letting them pursue referral of a balanced-budget amendment to the Constitution.

Ratification would take years. If enacted, such an amendment would amount to the same abdication of political responsibility to make wise and responsible cuts in spending as has been evident in the debt-ceiling debate.

It is obvious to me that the Balanced Budget Amendment is needed because of the “abdication of political responsibility to make wise and responsible cuts in spending” that Brummett is talking about and we have all seen for decades.

The real debate in my view should be which variety of amendment should we pass. This is a series of posts I am doing on that subject. They come from Brian Darling’s excellent article, ” The House and Senate Balanced Budget Amendments: Not All Balanced Budget Amendments Are Created Equal,” Heritage Foundation, July 14, 2011. 

Abstract: Republicans in the House and Senate have announced that they will force votes on balanced budget constitutional amendments. While the Senate and House versions of the current BBA are similar, there are some important differences that Members of Congress and the American people need to understand. For example, the Senate version makes it more difficult to enact revenue-neutral tax reform, while the House version would waive its tax limitation in times of military conflict. How Congress resolves these differences could determine whether future Congresses and Presidents balance the budget without increasing taxes.

Differences Between S.J. Res. 23 and H.J. Res. 1

Waivers for War or Military Conflict

Both the Senate and House versions of the BBA provide for a waiver during a war or military conflict because an unyielding requirement to balance the budget during such times might unduly constrain the U.S. military, but these waiver provisions differ dramatically and warrant close scrutiny. Specifically, the House provision would suspend the entire BBA, while the Senate version would permit only a partial waiver when the U.S. is engaged in a congressionally authorized “military conflict.”

Both the Senate and House versions of the BBA provide for a waiver during time of declared war. The House version would waive all provisions of the BBA, and the Senate version would waive all provisions of the BBA with the exception of Section 4, which requires a two-thirds vote in each chamber to increase taxes.

The Senate version requires a higher threshold for waiver during “military conflict” than for official declarations of war. Section 6 of the Senate version allows for Congress to waive certain provisions of the BBA “for any fiscal year in which a declaration of war against a nation-state is in effect” by a majority vote of both chambers. Section 7 allows for Congress to waive certain provisions “in any fiscal year in which the United States is engaged in a military conflict that causes an imminent and serious military threat to national security and is so declared by three-fifths” of both the House and Senate.

The House version allows Congress to waive the whole BBA “for any year in which a declaration of war is in effect” or “any fiscal year in which the United States is engaged in military conflict which causes an imminent and serous military threat to national security and is so declared by a joint resolution.” The House waiver provision would go into effect with a simple majority vote of each chamber.

Neither the House nor the Senate version would require a declaration of war as a predicate to waive certain provisions of the constitutional amendment. The Senate version requires a supermajority to authorize a waiver, whereas the House version requires a mere simple majority to waive during time of authorized “military conflict.”

For example, if a majority, but less than three-fifths, of each chamber authorized a wavier of the BBA during military conflict, the House version would allow Congress to waive the entire amendment and deficit-spend in areas unrelated to the military conflict. The Senate version would not allow a waiver, because both chambers would have to approve a waiver by a three-fifths vote. For the House version, the declaration of “military conflict” allows a waiver by majority vote of both chambers, whereas the Senate version would allow a waiver only if three-fifths of both chambers voted affirmatively. This is a significant difference in the two approaches to securing a waiver during a “military conflict.”

Additionally, the Senate BBA requires that, even if the United States were in a state of declared war or a military conflict, the House and Senate would still have to pass a revenue or tax measure by a supermajority roll-call vote. The House version does not contain such a requirement.

A specific condition on the nature of funding a “military conflict” appears in Section 7 of the Senate version but is absent in the House version. This condition would require Congress to specify the amount necessary for the military conflict as part of the budgeting process. The Senate resolution states that “such suspension must identify and be limited to the specific excess of outlays for that fiscal year made necessary by the identified military conflict.” The deficit for a fiscal year envisioned in the Senate version is limited to the cost of the military conflict itself, and in no circumstances can it be used to justify deficit spending elsewhere in the government.

The House waiver provision, on the other hand, is exceptionally broad in that it would give Congress carte blanche authority to deficit-spend on non-military items such as education, entitlements, transportation, or any other area where the federal government spends taxpayer dollars.

The requirement for a simple majority vote, coupled with the provision allowing non-military spending to breach a balanced budget requirement during times of military conflict, weakens the practical effects of the House BBA. Since the United States has been in a continuous state of “military conflict” since 2001 and may continue in such a state for the foreseeable future, the House language could be used to justify budget deficits for many years to come.

Effective Date

The two versions of the BBA have different effective dates. Both dates, however, give Congress and the President time to prepare to meet the BBA’s balanced budget requirement.

Section 11 of the Senate version of the BBA states that the budget must be balanced “beginning with the fifth fiscal year beginning after [the amendment’s] ratification.” Section 9 of the House version makes the effective date “beginning with the later of the second fiscal year beginning after [the amendment’s] ratification or the first fiscal year beginning after December 31, 2016.”

The Senate version allows for Congress to take five years to balance the budget no matter what year the states ratify the constitutional amendment—a provision that gives Congress five years to develop a plan to chip way at overspending.

If it were to be ratified this year, the House version gives Congress until 2016 to balance the budget. But what if it takes five years for Congress to ratify the amendment? The House version would give Congress two years to put the budget in balance. For a Congress that has had a hard time coming even close to balancing the budget, this requirement might prove rather daunting.

Total Outlays v. Total Receipts

The House and Senate versions of a BBA include a procedure by which more than a majority is necessary for Congress to pass an unbalanced budget. This provision in both measures allows some flexibility in the operation of a BBA. There may be a time when a supermajority of House and Senate Members deems it necessary to spend more than is taken in for a specific fiscal year.

The House and the Senate versions differ on the percentage of votes required to pass an unbalanced budget for a given fiscal year. Section 1 of the Senate version provides for a “two-thirds” vote of each chamber to pass an unbalanced budget; Section 1 of the House version provides for a “three-fifths” vote of each chamber.

If the House version were to become part of the Constitution, the House would need 261 votes and the Senate would need 60 votes to pass an unbalanced budget. If the Senate version were to become an amendment to the Constitution, the House would need 290 votes and the Senate would need 67 votes to pass an unbalanced budget. The House version would create a lower threshold to run budget deficits.

Clearly, the Senate version makes it tougher for Congress to waive the BBA during a time when the U.S. is at peace with other nations.

Prohibition on Court-Ordered Tax Increases

Section 8 of the Senate BBA states that “no court of the United States or of any State shall order any increase in revenue to enforce this article.” This provision would prohibit activist federal judges from ordering tax increases as a means to balance the budget. This provision is absent in the House version.

While preventing the courts from raising revenue is certainly prudent, it is not enough. The courts can still meddle with a BBA—for example, by issuing declaratory judgments or choosing how to balance the budget. The only way to prevent activist judges from intruding on political questions such as spending choices is a complete ban on judicial enforcement of the amendment. Any BBA should contain such a complete and explicit ban on judicial enforcement.[9]

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