The Case for a Balanced Federal Budget Amendment to the Constitution

The United States faces a persistent challenge with its federal budget, running deficits year after year. This ongoing imbalance affects the economy and the daily lives of American citizens. Section 300 of the Congressional Budget Act (the Budget Act) provides that on or before April 15 of each year, "the Congress shall complete action on a concurrent resolution on the budget for the fiscal year that begins on October 1 of that year."

A balanced federal budget, passed by Congress by the federally required date, is essential for economic stability and long-term prosperity. Yet, achieving this goal through Congress alone remains unlikely due to political interests and the desire to maintain power. A promising solution lies in amending the Constitution through an Article V Convention of States, which could enforce fiscal responsibility and restore balance.

A balanced budget means the government’s annual spending does not exceed its revenue. When the federal government consistently spends more than it earns, it borrows money, increasing the national debt. This debt has several negative consequences:

• Higher interest payments: The government spends billions annually to pay interest on its debt, diverting funds from essential services such as education, infrastructure, and healthcare.

  
  

• Reduced economic growth: Large debt can crowd out private investment, slowing economic expansion and job creation.

  
  

• Increased risk of financial crises: Excessive borrowing can undermine confidence in U.S. financial stability, potentially leading to higher borrowing costs or economic shocks.

  
  

• Burden on future generations: Today’s debt becomes tomorrow’s obligation, limiting future policymakers’ ability to respond to crises or invest in new priorities.

  
  

Balancing the budget would help avoid these issues by ensuring the government lives within its means. It would promote fiscal discipline, reduce debt growth, and create a more predictable economic environment.

Balancing the federal budget would benefit the U.S. economy and its citizens in several concrete ways:

• Lower interest rates: With reduced government borrowing, interest rates tend to fall, making it more affordable for businesses and individuals to borrow money for homes, education, and expansion.

  
  

• Stronger economic growth: Reduced debt frees up capital for private investment, leading to more jobs and higher wages.

  
  

• Improved government services: Savings from lower interest payments can be redirected to critical programs, such as infrastructure repair, education, and healthcare.

  
  

• Greater financial security: A balanced budget reduces the risk of sudden tax hikes or spending cuts needed to address debt crises.

  
  

• Increased confidence: Both domestic and international investors gain confidence in the U.S. economy, supporting stable markets and currency value.

  
  

For everyday Americans, these benefits translate into more job opportunities, better public services, and a more stable economic future.

Despite the clear advantages, Congress has repeatedly failed to pass balanced budgets. This failure stems from several factors:

• Political incentives: Members of Congress often prioritize short-term gains to satisfy voters or special interest groups rather than long-term fiscal health.

  
  

• Power dynamics: Balancing the budget requires difficult decisions, including spending cuts or tax increases, which can be unpopular and threaten incumbents’ reelection chances.

  
  

• Lack of enforcement: Current laws and rules do not compel Congress to balance the budget, allowing deficits to continue unchecked.

  
  

• Complex budget process: The federal budget involves many stakeholders and competing priorities, making agreement difficult without a binding framework.

  
  

Because of these challenges, expecting Congress to voluntarily limit its own power and authority to maintain a balanced budget is unrealistic.

How an Article V Convention of States Could Achieve a Balanced Budget Amendment

The U.S. Constitution provides a method for amending itself through an Article V Convention of States. This process allows states to propose amendments without relying solely on Congress. Here’s how it could work to enforce a balanced budget:

• States call for a convention: When two-thirds of state legislatures agree, they can convene a convention to propose amendments.

  
  

• Propose a balanced budget amendment: The convention could draft an amendment requiring Congress to pass a balanced budget by September 30th each year.

  
  

• Ratification by states: The proposed amendment would need approval by three-fourths of the states to become part of the Constitution.

  
  

• Binding fiscal rules: Once ratified, Congress would be constitutionally required to balance the budget annually, with legal consequences for failing to do so.

  
  

This approach bypasses Congress’s reluctance and places fiscal responsibility directly into the Constitution, limiting government spending and borrowing.

Achieving a balanced budget amendment through an Article V Convention requires coordinated action:

• State legislatures must act: Citizens can urge their state representatives to support calls for a convention focused on fiscal responsibility.

  
  

• Clear amendment language: The proposed amendment should specify deadlines, enforcement mechanisms, and exceptions for emergencies.

  
  

• Public education: Voters need to understand the benefits of a balanced budget and the convention process to build widespread support.

  
  

• Bipartisan cooperation: Fiscal responsibility appeals across party lines, making it possible to unite diverse groups around this goal.

  
  

Examples from states like Texas and Florida show growing interest in this approach, reflecting frustration with federal budget practices.

Some worry that a convention could lead to unintended changes beyond the balanced budget amendment. These concerns can be managed by:

• Limiting the scope: States can specify that the convention address only the balanced budget issue.

  
  

• Transparency: Open proceedings and public oversight can prevent overreach.

  
  

• Ratification safeguards: Any proposed amendments still require approval by a supermajority of states, protecting against radical changes.

  
  

This process offers a democratic way to restore fiscal discipline without relying on Congress’s goodwill.

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