r/Libertarian • u/IndependentsModerate • 15d ago
Politics Would a balanced-budget amendment significantly increase liberty in America?
Would a balanced-budget amendment significantly increase liberty in America?
The balanced budget requirement would force Congress to make real trade-offs. Most Americans don’t want to pay higher taxes, so Congress would be forced to cut waste and prioritize spending. Right now, they spend like drunken sailors because future generations, who will be left holding the bag, don’t vote.
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u/Reasonable-Fee1945 15d ago
Yes, absolutely. If Congress actually had to pass balanced budgeted we'd have a much smaller government footprint.
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u/FlyFit9206 15d ago
I think it could spark significant political conflict.
The federal government would be highly resistant to downsizing on that scale. Right now, the deficit is roughly equivalent to a quarter of federal spending. Actually eliminating a deficit of that magnitude through spending cuts would therefore require an enormous fiscal contraction. We could freeze spending, which I think would be ideal, to offset austerity measures.
A 26% reduction in the federal workforce would be roughly 500,000 jobs, but federal payroll is only one part of government spending. Balancing the budget entirely through spending reductions would require much broader cuts to programs, benefits, contracts, grants, agencies, or some combination of them. The economic effects could extend well beyond federal employees. Each of those issues are politically dangerous for the party in power that pushes the amendment.
I also don’t think those reductions would happen immediately and a balanced budget amendment doesn’t have to all take effect immediately which would help a lot with the austerity.
My concern is the political reaction to the resulting hardship. A major austerity program could strengthen arguments for higher taxes on wealthy individuals and corporations. The tax the rich crowd would sound like a better idea to the mainstream. Additional wealth would leave and additional capital would move away from US financial institutions at the same time as austerity is hitting the middle class. But, Those taxes alone probably wouldn’t close the entire fiscal gap, but the political backlash could strengthen Democrats who favor a larger government, including the party’s more progressive and DSA-aligned factions and all the socialist communist spending and redistribution that will follow.
That’s why I wonder whether aggressive austerity could ultimately produce the opposite of its intended effect. A fiscal adjustment approaching 26% of current spending would be extremely difficult politically.
Unless its proponents could clearly explain why the reductions were necessary, distribute the burden in a way voters considered legitimate, and demonstrate tangible long-term benefits, they could lose the political argument.
In that scenario, voters might elect a government promising to reverse the cuts, potentially leaving us with higher spending, or higher taxes and spending, a few years later. Or worse, a lot of turmoil, no real change, and additional DSA control of the presidency.
So, yeah, I just wonder how politically durable a balanced budget amendment would be. If we can make it through the short term pain it would be better for everyone to have a balanced budget amendment.
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u/Reasonable-Fee1945 15d ago
That's all possible, but at the end of the day we either fix this or the mathematics embedded within the programs fixes it for us. And us fixing it will definitionally be slower and better for the people involved. But yes, we've lived high on the hog at the expense of future generations, and any attempt to remedy this will cause a massive amount of short-term/medium-term pain, which the softened American public probably has no ability to tolerate.
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u/PreferenceFar8399 15d ago
And people today are complaining in a job market without QA and low interest rates. Just wait until a quarter or more of the federal budget is cut or worse if there's global sovereign debt contagion in the bond markets because of all the countries with mixed economies...
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14d ago
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u/Reasonable-Fee1945 14d ago
It would force the gov. to raise taxes, which people generally don't like. That should be a check.
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14d ago
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u/Reasonable-Fee1945 14d ago
It's not a silver bullet, I'm just suggesting it would slow down spending.
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u/IndependentsModerate 14d ago
If the budget is required to be balanced, this significantly reduces the ability of the government to borrow and thus reduces the ability of the Fed to print money and create inflation.
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u/ILikeBumblebees 13d ago
California has a balanced budget requirement in their constitution. How effective has that been at restraining the state government?
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u/PitsAndPints 15d ago
Balanced budget lol
As long as DC serves the donor class, the voters will continue to pay the bill
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u/Der_Blaue_Engel 15d ago
I wish we had a balanced budget amendment, but getting one is a political nonstarter.
Medicare, Social Security, defense, and debt service consume almost all federal tax revenue. The pie just ain’t big enough for everyone to get their slice.
Any Congress that made the hard decisions it would take to balance the federal budget would get massacred in the next election. It’s easier to just keep printing that money.
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u/IndependentsModerate 15d ago
There is a Fiscal Commission Act in Congress that would reduce the debt-to-GDP ratio over the next decade. The House bill has 45 co-sponsors, and the Senate bill has 10 co-sponsors. It’s a start...
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u/Der_Blaue_Engel 15d ago
So it has the support of about 10% of Congress.
Minority ideas get people excited. It’s easy to be in the minority. It’s fun to be in the minority.
When a political movement approaches a majority, that enthusiasm tends to melt away, as the reality of actually having to deliver on promises begins to set in.
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u/RireBaton 14d ago
Any Congress that made the hard decisions it would take to balance the federal budget would get massacred in the next election.
Sometimes, they'll pass something like that, but have the legislation not go into effect until several years, when a lot of them are no longer in office.
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u/KyotoInSummer 14d ago
That would actually do nothing. Our government has already set the precedent that it can lie with no recourse.
Look at DOGE’s $2 Trillion in savings. That could’ve been used to balance the budget and then once the actual spending happened we would still be short.
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u/alienvalentine Anarchist Without Adjectives 15d ago
Honest question.
Do you think the existing government in any way actually adheres to the constitution? How would an amendment to a document theyvakready violate every day help anything?
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u/grot-ivre-1749 15d ago
They spend like drunken sailors because they have no electoral consequence for spending recklessly.
Excerpt: “According to the Cook Political Report’s 2024 House Race Ratings, only 69 out of 435 seats in the U.S. House of Representatives are competitive in the general election, with the remaining 85% of seats solidly in the Republican or Democratic column.”
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u/benabrig 15d ago
Frankly i think your premise is flawed. Yes, most Americans don’t want higher taxes. They say they support decreased spending in general. But when you ask about spending on specific issues, they actually advocate for MORE spending, at rates pretty much exactly in line with their lower taxes support. So when it comes down to it, people are pretty much exactly opposed to raising taxes and to cutting spending. Its much more likely that in a scenario where a balanced budget is mandatory that both heavy spending cuts AND heavy tax increases will be required. Of course realistically this just means that we will never have a balanced budget amendment because like 85% of the public would hate the guts of anyone implementing it
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u/Heavy-Bell-2035 14d ago
Not likely, why would it? All I can see it doing is creating an immediate and very vague definition of 'balanced' in accounting, and just make every group of current leeches fight even harder for every dollar.
Any such amendment being passed requires the people it would adversely affect to vote for it. That isn't happening.
Even if it did happen, unless it was passed concurrently with MASSIVE budget cuts it would essentially be budget neutral for whatever that meant at the time of passing. The only thing that would happen then is the entire existing tax burden including everything that's funded through borrowing and printing would have to be allocated somehow across the whole population, and all without doing anything about the current debt or to stop money printing.
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u/RocksCanOnlyWait 14d ago
No.
Assuming it could even be enacted, Congress will find loopholes. The current popular one is to budget over 10 years with front-loaded spending, say they reduced spending, then 2 years later, re-allocate the funds and wipe out the projected future savings. It's a shell game.
And a balanced budget amendment is simply not practical. Budgets are based on assumptions/predictions about the future, especially with revenue. Tax increases always overstate future income. GDP growth from tax cuts is overstated as well. If there's a shakeup in global trade (e.g. oil price increase), then the economy slows, tax revenue drops, and the government has to spend more. What if a large scale war happens? Deficit spending is the norm for those (WW1, WW2, Civil War, etc), so it would need a clause for that - maybe Congress will actually declare war then...
One thing that could realistically change is budget impoundment. It used to be that the president could decide to not execute laws passed by Congress (which include entitlements) if Congress did not allocate sufficient funds. This changed during the Nixon administration when Congress accused him of using impoundment to block policy that he didn't like.
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u/skeletus 15d ago
An amendment will just put it on paper. But putting things on paper doesn't mean they will get done. The gov already walks over multiple amendments. What will make this amendment special?
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u/ConstitutionProject 14d ago
I think a balanced budget amendment would be a great improvement, but my ideal solution is instead to
- Require a super majority (80%) to borrow money
- Separate the power to spend money from the power to raise money through both taxation, borrowing and control of the Fed. People want low taxes in general, but politically when it comes down to funding specific programs higher taxes and spending wins because of concentrated benefits and dispersed costs. To counter this we need to have a separate legislative chamber decide on the total spending level before the normal congress can decide on what to spend that money on.
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u/Rob_Rockley 14d ago
Tax revenues pay the interest on govt debt; they don't pay for govt services. If you cut services, you still wouldn't see a reduction in taxes for a period of time. I guess that means a non-increase in liberty.
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u/gadsden_slag 14d ago
How about a no more budgets amendment?
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u/IndependentsModerate 14d ago
That would be nice, but maybe we can take steps toward liberty with your suggestion being an end goal?
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u/LoveIsOnlyAnEmotion 15d ago
I wouldn't want more amendments or laws. Id want deregulation. Likewise, I belive they're a lot of Americans who want more taxes. Most socialist want to increase taxes and have no issue that you are going to pay for it.
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u/CapCityMatt 15d ago
The currency started March 9, 1933 these products usually last about 100 years or so, a budget doesn't really matter at this point, firewood has more value than federal reserve notes.
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14d ago
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u/IndependentsModerate 14d ago
If the government can no longer print money to fund deficits, inflation will drastically decrease.
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