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Balanced Budget Constitutional Amendment
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I think we need to start a renewed discussion on a balanced budget amendment to the Constitution. The amendment would have to contain language providing that any tax increase employed to reduce a deficit would have to be paired with a corresponding spending cut of value equal to or greater than the tax increase.
Who's in?
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"The natural progress of things is for liberty to yield and government to gain ground." TJ
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Location: Iowa, how long can this be? Does it really ruin the left column spacing?
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Yeah but those libs and dems would never go for it, what with their genetic deficiencies and penchant for entitlements.
Let's get this started off right.
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I'm in so that's three of us; Laminar, myself, and Big Mac.
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So every time the nation goes to war, you still need to balance the budget that year?
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Experience has shown the budget doesn't get balanced the next year either. Or even the next decade.
Perhaps a credit limit. If the nation is above the credit limit, then emergency spending must be covered by emergency cuts. An incentive to cut down the number of emergencies.
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That actually makes a lot more sense. Baby steps fellas. Perhaps an amendment that says that the total federal debt can't be more than X% of GDP in peacetime and Y% in wartime would be a better approach?
OAW
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Originally Posted by OAW
That actually makes a lot more sense. Baby steps fellas. Perhaps an amendment that says that the total federal debt can't be more than X% of GDP in peacetime and Y% in wartime would be a better approach?
OAW
When was the last time the US was in peacetime? During the ramp up to the Iraq invasion it was pointed out many times that the US had been in a state of war with Iraq since Desert Storm.
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America, and Americans, run on credit. Not going to happen.
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Originally Posted by reader50
Experience has shown the budget doesn't get balanced the next year either. Or even the next decade.
Perhaps a credit limit. If the nation is above the credit limit, then emergency spending must be covered by emergency cuts. An incentive to cut down the number of emergencies.
So an extension to the debt ceiling that gives it teeth then. I'd even be in for that.
Originally Posted by OldManMac
America, and Americans, run on credit. Not going to happen.
It's in the Constitution that we have to have deficits and debt? That the government has to harm the private economy by spending beyond its means and mandate? Please point to the relevant Article and Section where I can find those supposed requirements.
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Last edited by Big Mac; Nov 7, 2010 at 08:50 PM.
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Originally Posted by Big Mac
So an extension to the debt ceiling that gives it teeth then. I'd even be in for that.
It's in the Constitution that we have to have deficits and debt? That the government has to harm the private economy by spending beyond its means and mandate? Please point to the relevant Article and Section where I can find those supposed requirements.
I didn't say it was in the Constitution, so don't be disingenuous. I would love it if it weren't so, but it's not going to happen. Why don't you write your reps and demand that we pull out of all the foreign bases, and stop invading sovereign nations (while conveniently overlooking all the despots and other dictators we've propped up over the decades)? That would go a long way, and you'd still have your poor and lazy welfare folks to attack.
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You guys do realize that a constitutional amendment that ties taxation to spending is the surest way to raise taxes, right? You are assuming that in the face of an amendment like this Congress will quit spending. This is a false assumption. Not only will they continue to spend, but when they raise our taxes, they will say "Sorry, we had no choice, the Constitution made us do it".
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Originally Posted by Dork.
You guys do realize that a constitutional amendment that ties taxation to spending is the surest way to raise taxes, right? You are assuming that in the face of an amendment like this Congress will quit spending. This is a false assumption. Not only will they continue to spend, but when they raise our taxes, they will say "Sorry, we had no choice, the Constitution made us do it".
Ergo, the constitution is Socialist.
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Dork., one thing that I stated was that any tax increase to raise revenue in order to cover a deficit would have to be met with a corresponding cut in spending of equal or greater value.
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There would definitely need to be laguage to allow for emergency spending, which would complicate things and create a loophole for congress to exploit. I think that our government needs to be free to spend what they need to do what needs to be done.
What is needed is a vigilant and responsible electorate who will vote out the idiots, as well as a...wait for it...change in philosophy to one which doesn't favor the kind of huge government and entitlements we have and are continuing to move towards.
Also, the return to intrinsically valued currency and the elimination of the fed would remove their ability to spend what they want and just monetize their irresponsibility. <beatingdeadhorse>
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Being in debt and celebrating a lower deficit is like being on a diet and celebrating the fact you gained two pounds this week instead of five.
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I don't know about the wisdom of eliminating central banks. I think they do have value when they're used properly. If you look at the history prior to the establishment of the Fed, there were frequent and sharp peaks and valleys in the business cycle that caused a lot of disruptions and difficulties. The creation of the Fed was preceded by a liqudity crisis of such severity that it required the richest people in America to lend money out for the creation of a central bank. Also, while gold is a good alternative currency, especially if you know how to time your entry and exit in and out of gold ownership, it really constrains economic flexibility to use it as a standard.
As for emergency spending being a concern, a balanced budget requirement would force Congress to make real choices. Government then can't spend more than there is available to spend. And besides, if we couple a balanced budget requirement with deep cuts in Entitlements and the federal payroll, spending will be cut to a fraction of its current levels anyway; balanced budgets won't be nearly as difficult to attain.
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Last edited by Big Mac; Nov 8, 2010 at 02:48 AM.
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"The natural progress of things is for liberty to yield and government to gain ground." TJ
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Originally Posted by smacintush
Also, the return to intrinsically valued currency and the elimination of the fed would remove their ability to spend what they want and just monetize their irresponsibility. <beatingdeadhorse>
And introduce other costs.
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Originally Posted by SpaceMonkey
And introduce other costs.
Such as?
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Being in debt and celebrating a lower deficit is like being on a diet and celebrating the fact you gained two pounds this week instead of five.
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Although I'm in favor of a constitutional provision to limit the budget deficit (the German constitution fortunately has one), I don't think the type Big Mac proposes makes sense to me. I'm not even sure you can find a formulation that isn't self-contradictory: any tax reduces the deficit since it's on the income side.
What I'd immediately agree to is an amendment that limits the total deficit and the annual budget deficit.
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Originally Posted by Big Mac
I don't know about the wisdom of eliminating central banks. I think they do have value when they're used properly. If you look at the history prior to the establishment of the Fed, there were frequent and sharp peaks and valleys in the business cycle that caused a lot of disruptions and difficulties.
And what have we had since the Fed? The Fed's actions give us the very boom and bust system we have now, including creating the great depression (even Bernanke admits that). They are a bubble factory.
The creation of the Fed was preceded by a liqudity crisis of such severity that it required the richest people in America to lend money out for the creation of a central bank.
As opposed to the current system where banking insiders run the system insecret? Where instead of borrowing, they print more money which amounts to a stealth tax and creates inflation and devalues the dollar?
Also, while gold is a good alternative currency, especially if you know how to time your entry and exit in and out of gold ownership, it really constrains economic flexibility to use it as a standard.
Such as?
No fiat currency has ever lasted more than 42 years. It is intrinsically flawed and gives massive central economic power to the very few.
I see no evidence that giving bankers monopoly power to play games with our currency is somehow better than the alternative.
emergency spending being a concern, a balanced budget requirement would force Congress to make real choices. Government then can't spend more than there is available to spend. And besides, if we couple a balanced budget requirement with deep cuts in Entitlements and the federal payroll, spending will be cut to a fraction of its current levels anyway; balanced budgets won't be nearly as difficult to attain.
I'll have to study this one further.
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Being in debt and celebrating a lower deficit is like being on a diet and celebrating the fact you gained two pounds this week instead of five.
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Originally Posted by OreoCookie
I'm not even sure you can find a formulation that isn't self-contradictory: any tax reduces the deficit since it's on the income side.
Valid critique. My language may not have been clear, but what I meant by a tax increase to reduce deficits was one that's justified because of emergency deficit reduction. For example, it would prevent Congressmen from justifying tax increases to address deficits unless they were prepared to also reduce spending by the same amount as the proposed tax increase.
A simpler formulation would be no increase in taxation without a corresponding decrease in spending.
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@Big Mac
That's exactly the problem: any formulation would be problematic, because you'd make next to impossible to make even sensible things such as lowering one tax, but raising another. Even if we assume that the total tax burden is lower than before, government would have to make cuts of the same size.
Sorry, but I don't think you can find a formulation you can begin to work with: either it's so strict it impedes even sensible cases of normal government policies or it would have so many holes it wouldn't be worth the paper it is printed on.
Budget deficit and total deficit on the other hand are easy to check criteria and don't restrict how governments stay frugal.
Personally, I find an increase on the income side a (read: one of many) sensible tool to get the budget deficit under control. I'm very glad my constitution has such a provision.
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Valid point, but if there were to be a balanced budget amendment there would have to be a built-in mechanism to limit tax increases.
Perhaps it's better to go at it from a different angle: An amendment to limit federal spending to a certain percentage of GDP.
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"The natural progress of things is for liberty to yield and government to gain ground." TJ
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Originally Posted by Big Mac
Perhaps it's better to go at it from a different angle: An amendment to limit federal spending to a certain percentage of GDP.
Where does limiting debt come in? I thought that was the point of your proposal, right?
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If you limit it to a sane percentage of GDP you'll automatically be limiting debt.
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"The natural progress of things is for liberty to yield and government to gain ground." TJ
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Originally Posted by Big Mac
If you limit it to a sane percentage of GDP you'll automatically be limiting debt.
No, if you link the budget to the total GDP, you'd only limit the budget, but not the budget deficit. (Ok, theoretically, you'd limit the budget deficit to the maximal permissible budget, but that's only a theoretical limit.) Even though if you claim that the annual budget deficit in absolute numbers is smaller, if you limit the size of the budget, then you also limit the state's ability to pay back the debt (which it eventually has to).
If the purpose of the amendment is to get the deficit under control (and the name `balanced budget amendment' certainly implies this intention), then I don't think this is the correct way. What you have in mind is not a limit to the budget deficit and total debt, but a limit to the size of the federal government which is a whole different story. What should be limited is the annual deficit and total debt instead -- two easily measurable quantities which do not limit political freedom on how to achieve this goal.
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Which is a good point, but Dork points out that if you do that you just invite the Left to raise taxes to support their enormous government designs.
One conservative governor said that his state balances the budget with a provision that deficit spending in one fiscal year gets carried over in the form of mandatory spending cuts of the same amount as the previous year's deficit. Perhaps that's the proper way to constrain spending.
As for retiring national debt, how's that ever going to get accomplished? Just a few years ago we broke $10 Trillion, but I imagine five years from now we'll be $20 Trillion unless Republicans get going. There's no way to repay that debt in straight forward way. It either has to be restructured or the dollar has to be inflated to worthlessness.
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Last edited by Big Mac; Nov 8, 2010 at 09:42 AM.
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"The natural progress of things is for liberty to yield and government to gain ground." TJ
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Originally Posted by smacintush
Such as?
Deflation, generally. And anything having to do with an essential lack of monetary policy. See "Depression, Great."
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Originally Posted by Big Mac
As for retiring national debt, how's that ever going to get accomplished?
The same way ordinary people pay back their debt: you make a budget which has a surplus which is used to pay off debt.
Originally Posted by Big Mac
Which is a good point, but Dork points out that if you do that you just invite the Left to raise taxes to support their enormous government designs.
Curbing the total debt is a bad thing?
To pay back a debt of this order of magnitude, you have to increase your income and cut spending. Just doing one or the other won't do the trick. What the connection to `government programs' is, is beyond me.
You're right that limiting the annual budget deficit (e. g. as a percentage of the GDP) doesn't say anything about the size of the budget: it could be very small or very large, what matters is the difference between the amount the state spend and the amount the state has on the income side. I actually like this about the approach: it's agnostic in terms of government philosophy and party in power. If people want to vote politicians in power who want to shrink the size of the state, as long as the criteria for public debt are met, they can do that. If people vote for a government in favor of more spending, then that's fine, too.
Originally Posted by Big Mac
One conservative governor said that his state balances the budget with a provision that deficit spending in one fiscal year gets carried over in the form of mandatory spending cuts of the same amount as the previous year's deficit.
Those are peanuts compared to the sums you have to consider when you want to pay back government debt. Currently, it is about 100 % of the GDP, i. e. America would have to work one year just to pay off its debt. (Germans would have to work `only' 8.5 months.) So we're talking about trillions of dollars.
Originally Posted by Big Mac
Just a few years ago we broke $10 Trillion, but I imagine five years from now we'll be $20 Trillion unless Republicans get going. There's no way to repay that debt in straight forward way. It either has to be restructured or the dollar has to be inflated to worthlessness.
You cannot `restructure' debt away, it will stay there (that's what caused the banking crisis). Also, your hope on a fundamental change with a Republican congress won't materialize: just have a look at the charts that show the public debt in terms of the GDP.
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There's another fatal flaw in the arguments in this thread: the notion that politicians "on the Left" are the only ones capable of ruinous spending. An honest analysis of the past 10 years ought to refute that. I think that people are less interested in being honest, though, since it is more fun to shout and point fingers.
The fact of the matter is that for all the talk we've heard during this election about smaller government, folks "on the Right" love big Government, as long as it benefits them directly.
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Perhaps the methodology is backwards? Why not start eliminating wasteful programs and agencies and entities? we should work our way out to a less expensive federal government. Streamline the way the gov't acquires goods & services. Look at useless wastes of money (Like the UN, foreign aide to terrorist supporters like the Saudi's) and stop paying for it. Scale back entitlements, or move them to private industry. Revamp the welfare systems to verify payments and verify those who receive such payments. Remove those found guilty of defrauding the systems from ever being able to make claims against it.
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The problem with that is that we all need to agree on what gets cut, and there are real consequences of the cuts. For example, ask the folks who were on those planes with the toner cartridge bombs whether they feel "foreign aide to terrorist supporters like the Saudi's" is worthwhile. (The Saudis provided the key piece of Intel that led us to finding those bombs.)
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Originally Posted by BadKosh
Look at useless wastes of money (Like the UN, foreign aide to terrorist supporters like the Saudi's) and stop paying for it.
The amount of aid money given to Saudi Arabia is relatively miniscule (well under $10 million per year, AFAIK, and almost entirely security-related). It might be important as a political issue, but it's irrelevant as a budget issue.
Also, according to the UN, current U.S. arrears total $1.2 billion, so I don't think you need to worry about us overspending there yet either.
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How about a Constitutional Amendment that demands that the Constitution be taken seriously by the political elite ?
Oh, wait, nevermind
-t
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Originally Posted by turtle777
How about a Constitutional Amendment that demands that the Constitution be taken seriously by the political elite ?
Oh, wait, nevermind
-t
Or even read and above all, understood by elected officials. If it were, we wouldn't be in such a big mess to begin with.
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Originally Posted by Big Mac
I think we need to start a renewed discussion on a balanced budget amendment to the Constitution. The amendment would have to contain language providing that any tax increase employed to reduce a deficit would have to be paired with a corresponding spending cut of value equal to or greater than the tax increase.
Who's in?
Makes no f*cking sense.
Does it mean for every spending cut, there needs to be a tax increase of equal or greater value than the spending cut?
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Bush Tax Cuts == Job Killer
June 2001: 132,047,000 employed
June 2003: 129,839,000 employed
2.21 million jobs were LOST after 2 years of Bush Tax Cuts.
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I think if the various agencies can't tell why something is being done/funded, or whether it should be funded should pull the plug on it. At some point we will get to what is important and what is BS. at least 15 percent of all the agencies expenses could be removed.
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Originally Posted by CRASH HARDDRIVE
Or even read and above all, understood by elected officials. If it were, we wouldn't be in such a big mess to begin with.
That would be great, if everybody agreed on what it meant.
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Originally Posted by SpaceMonkey
That would be great, if everybody agreed on what it meant.
Everybody but the idiots do!
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Originally Posted by The Final Dakar
Everybody but the idiots do!
My apologies. Carry on.
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Originally Posted by Dork.
There's another fatal flaw in the arguments in this thread: the notion that politicians "on the Left" are the only ones capable of ruinous spending. An honest analysis of the past 10 years ought to refute that. I think that people are less interested in being honest, though, since it is more fun to shout and point fingers.
The fact of the matter is that for all the talk we've heard during this election about smaller government, folks "on the Right" love big Government, as long as it benefits them directly.
Shhh. You're supposed to go along with the finger pointers who are smearing the Left, and not bring facts into this. Bill Clinton did actually shrink the government, and when Georgie got himself elected things went to hell in a handbasket quickly.
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Originally Posted by OldManMac
Shhh. You're supposed to go along with the finger pointers who are smearing the Left, and not bring facts into this. Bill Clinton did actually shrink the government, and when Georgie got himself elected things went to hell in a handbasket quickly.
But that was probably for security stuff which is constitutional, and few seem interested in really scrutinizing our security spending in addition to entitlement spending.
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Let me raise my hand again. Deep cuts across the board. It's the only thing that can rescue us from the enormous government monstrosity.
When it comes to priorities, national defense is a Constitutional obligation of the federal government that is obviously the most important, but it too must be cut.
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If "across the board" includes military spending, why was I called a seal clubber by simply questioning whether being involved in war was in our best interest?
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I already said all parts of government must be cut. You only seem to want to cut government that's objectionable to you, namely our ability to wage war when necessary.
Do you see that it was necessary to invade Afghanistan after 9/11? If not, then you prove my point.
As for seal clubbing, I didn't call you a seal clubber. I referred to your obnoxious expatriate patriotism for Canada by telling you to go back to the land of the seal clubbers where you'll apparently be much happier because while you may have left Canada the Canadian mindset never left you. And like many of your kind you seem to obsessively want to extol Canada's superiority over the country you chose to live in instead. Call me what you will, but I see it as a manifestation of insecurity.
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Last edited by Big Mac; Nov 8, 2010 at 08:57 PM.
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"The natural progress of things is for liberty to yield and government to gain ground." TJ
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I think your incessant need to put people into little boxes has blinded you to many things... There is no monolithic "your kind", we are all individuals with individual thoughts and opinions.
I see putting people into little boxes is a manifestation of insecurity, because it's easier to see the world in a certain way rather than to address intellectual roadblocks head on. This is why I've given up on trying to have most political conversations with you, because you are on some sort of mission to save the world with your dogma, not actually have a debate.
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Clinically Insane
Join Date: Oct 2000
Location: Los Angeles
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Ah, besson. The only intellectual road block around here is in your path (or in your block head), not mine. You can try to vilify me in the lame way you do, but you're the one who fails to address the cold, hard reality of the situation. You see, if you look back at my previous post in this thread, I ask you pointed, on topic questions that you utterly fail to address.
I seriously don't think you're intellectually prepared to be in these kinds of conversations.
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"The natural progress of things is for liberty to yield and government to gain ground." TJ
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Clinically Insane
Join Date: Mar 2001
Location: yes
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Yes, I'm completely oblivious to our debt, the cost of entitlements, the size of government and all of the stuff you preach in here constantly. I don't get it. Debt... bad?
Sorry, I'm just a seal clubber. I don't have a political science degree.
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Clinically Insane
Join Date: Oct 2000
Location: Los Angeles
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Originally Posted by besson3c
Yes, I'm completely oblivious to our debt, the cost of entitlements, the size of government and all of the stuff you preach in here constantly. I don't get it. Debt... bad?
He can be taught! Maybe.
Yes, debt is bad. The type of debt run up by people of your mindset is a debt that we will never be able to repay. And both Democrats and Republicans were responsible for it.
Sorry, I'm just a seal clubber. I don't have a political science degree.
Have you clubbed seals?
No, you don't have a degree in political science. No, you apparently don't have an academic background in economics, or business. Those things I have. You don't work in global finance, whereas I do. I live and breathe this stuff. So perhaps it's counterproductive for me to expect you to understand these things because our educational backgrounds and professional paths are very different. It's not arrogance. It's just the truth.
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Last edited by Big Mac; Nov 8, 2010 at 11:01 PM.
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"The natural progress of things is for liberty to yield and government to gain ground." TJ
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Addicted to MacNN
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^^
There are lots of "experts" who live and breathe this stuff who have different opinions, which is all you're spouting, and it is arrogance.
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Clinically Insane
Join Date: Mar 2001
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I'm tired of you telling me what "my mindset" is, when you could not even begin to paraphrase it.
Who do you hope to be able to speak with here if people without an academic background in politics, economics, business, and/or global finance are beneath you?
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