LegiStorm

Summary:

One of the most persistent political issues facing Congress in recent decades is whether to require that the budget of the United States be in balance. Although a balanced federal budget has long been held as a political ideal, the accumulation of large deficits in recent years has heightened concern that some action to require a balance between revenues and expenditures may be necessary. The debate over a balanced budget measure actually consists of several interrelated debates. Most prominently, the arguments of proponents have focused on the economy and the possible harm resulting from consistently large deficits and a growing federal debt. Another issue involves whether such a requirement should be statutory or made part of the Constitution. Some proponents of balanced budgets oppose a constitutional amendment, fearing that it would prove to be too inflexible for dealing with future circumstances. Opponents of a constitutional amendment often focus on the difficulties of implementing or enforcing any amendment. Their concerns have been numerous and varied. How would such a requirement affect the balance of power between the President and Congress? Between the federal courts and Congress? Although most proponents would prefer to establish a balanced budget requirement as part of the Constitution, some advocates have suggested using the untried process provided under Article V of the Constitution for a constitutional convention as an alternative to a joint resolution passed by two-thirds vote in both houses of Congress. Although the inclusion of a balanced budget amendment as part of the congressional agenda has muted this debate in recent years, proposals for a convention are still possible, and raise concerns that one might open the way to an unpredictable series of reforms. The last American constitutional convention convened in May 1787 and produced the current Constitution. These are also questions that will be raised and considered by Congress concerning the provisions that should be included in such a measure as it sifts through its options. Congress ultimately will decide whether consideration should be given to a constitutional requirement for a balanced budget; and if it decides to proceed, it will need to decide whether there should be exceptions to the requirement, or if it should include provisions such as a separate capital budget or a limitation on expenditures or revenues. For example, as reported from the House Judiciary Committee, H.J.Res. 1 in the 112th Congress includes provisions that would require a super majority to allow a budget with outlays in excess of receipts, to allow outlays to exceed 18% of the “economic output” of the United States regardless of whether the budget were balanced, to increase the debt limit, or to increase revenues. S. 365, enacted August 2, 2011 (P.L. 112-25), provides that the House and Senate vote on a balanced budget amendment between September 30, 2011, and December 31, 2011, and includes expedited procedures for its consideration. On November 18, 2011, the House voted on H.J.Res. 2, but did not achieve the two-thirds vote required for passage. On December 14, 2011, the Senate voted on S.J.Res. 10 and S.J.Res. 24, but neither measure achieved a majority vote. This report provides an overview of the issues and options that have been raised during prior consideration of proposals for a balanced budget constitutional amendment. It will be updated as events warrant.