Magazine article Insight on the News

Contract Gov't by Balancing Federal Budget

Magazine article Insight on the News

Contract Gov't by Balancing Federal Budget

Article excerpt

The federal budget deficit is widely publicized and recognized as a problem. But at a gut level, an abstract newspaper story about a fiscal shortfall does not hit the taxpayer like a tax increase. Nor is it remembered as long. And it affects the economy more slowly and indirectly.

So at a practical level, the deficit has allowed Washington to fool the American public about how much government it can afford. It's so easy that it has become standard operating procedure - the federal budget has not been balanced since the Nixon administration, and then only for one year.

If we really want to permanently reduce the size and power of the federal government, it therefore is imperative that the 104th Congress pass the balanced budget amendment. Quite simply, by exposing the full price of big government to the American people, the balanced budget amendment will render it financially prohibitive and politically obsolete.

The balanced budget amendment in the Republicans' "Contract With America" would amend the Constitution to require that total outlays for any fiscal year not exceed total receipts, a basic concept that governs the daily lives of millions of American families and businesses.

A constitutional amendment would require approval by two-thirds of state legislatures and take around seven years to complete. It has to start in Congress, however. (Such an effort failed last March by only 19 votes.) Congress could bypass these requirements and incur a deficit in case of a war or national security threat, or in some other extraordinary circumstance, if 60 percent of the members of both houses to agree.

Although liberals have blasted a balanced budget amendment as unfeasible, the Republican staff of Congress' Joint Economic Committee has found that the budget could be balanced in less than a decade - without raising taxes or touching Social Security - by simply limiting annual spending increases to less than 2 percent. Another option would be to simply freeze spending for one year, then limit increases to the rate of inflation.

The Republican alternative to President Clinton's pork-laden budget provides a map for the road to a balanced budget. Our plan would have cut $430 billion over five years. We would have eliminated 162,000 federal jobs, cut 15 percent of the internal budgets for Congress and the White House and reduced federal overhead spending by $165 billion. Our general approach can be summed up in four words: eliminate, shrink, privatize and consolidate. …

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