|AEI Report: Federal Fiscal Complacency is Now Dangerous – |
“The Congressional Budget Office’s latest forecast makes a convincing case that fiscal complacency is now dangerous for the U.S. economy,” says James C. Capretta at the American Enterprise Institute in an April 13 report.His review of the most recent Congressional Budget Office (CBO) study indicates “the federal government will borrow an additional $12.4 trillion over the next 10 years. At the end of 2028, the federal government will have outstanding debt of $28.7 trillion, or 96 percent of GDP. Ten years ago, federal debt was equal to 39 percent of GDP.”
Capretta says there is a case to be made for a balanced budget amendment. Read his report HERE.
CNBC Report: ‘Debt is About to Explode’ –
A CNBC report on the above-referenced CBO report carried a quote by CBO Director Keith Hall: “Such high and rising debt would have serious consequences for the budget and the nation … The likelihood of a fiscal crisis for the United States will increase.”
Read that April 9 article HERE.
NY Times: ‘Deficit Fuels Fear of Crisis’ –
NY Times writer Thomas Kaplan says that by 2028 “debt held by the public will almost match the size of the nation’s economy … a higher level than any point since just after World War II and well past the level that economists say could court a crisis.”
Kaplan quotes Michael A. Peterson, president and chief executive of the Peter G. Peterson Foundation, which advocates reining in budget deficits, as saying the CBO report “confirms that major damage was done to our fiscal outlook in just the past few months.”
He adds another quote from CBO Director Hall as saying that “beyond a decade, the debt would continue to rise compared with the size of the economy. He warned of the possible consequences if lawmakers put off addressing the trajectory of the government’s finances. ‘The longer you wait, the more draconian the measures have to be to fix the problem’.”
Read the entire NY Times article HERE.
Jason Chaffetz: Give States the Opportunity to Vote on a BBA –
FOX News.com has carried an article by former Utah Congressman Jason Chaffetz entitled “10 Things Congress Should Do, But Won’t”. Chaffetz says, “Congress is on the clock. Time is ticking. Here are ten actions Congress should take now to truly do the work of the American people, but they won’t.”
One of Chaffetz’s suggestions was: “Give the states the opportunity to vote on whether Congress should be subject to balancing the federal budget. We will never reign in spending until the American people have to pay for what we’re actually spending. … If two-thirds of the states want Congress to balance the budget, then they’ll have a mandate to do it.”
Read Chaffetz’s full list of suggestions HERE.
Former US Senator Gregg: ‘We’re Headed Over a Cliff’ –
During April Judd Gregg (a former New Hampshire Governor and former US Senator), who once served as chair of the US Senate Budget Committee, appeared on radio station WBUR (Boston) where he said: “We’re headed over a cliff as a nation.”
Reacting to the recent CBO report Gregg is quoted as saying, “[It means that] at some point in the future, we’re gonna have a fiscal issue that’s very significant, some sort of fiscal crisis, and that we’ll inevitably pass onto our children a lower standard of living, because they’ll have to pay down all this debt that we’ve run up during our generation and pass that debt onto them. And that will reduce their standard of living, and it’s not right. We should be much more fiscally responsible than we’re being as a government.”
Senator Gregg is affiliated with the Campaign to Fix the Debt, and recently joined the board of the BBA Foundation. Listen to the Gregg interview HERE.
The Hill: Congressional BBA Sought ‘Lipstick on a Pig’ –
Just before the US House voted on its version of a BBA, The Hill carried an article entitled: “GOP Amendment Tries to put Lipstick on Our Budget Pig”. After the authors finished deriding the proposal (which did not pass), they offered some observations.
They pointed out that “not all balanced budget amendments are created equal, and even if this one were to pass … it leaves much to be desired.” Among other deficiencies, the recently considered Congressionally-proposed BBA was not self-enforcing.
The authors noted that “any reasonable balanced budget amendment should aim not to end federal borrowing entirely, but to deter such borrowing absent exigent circumstances.” They said, “The key to an effective BBA is language that enforces a balanced budget over time without mandating one. Many proposals exist for doing just this, complete with penalties when Congress doesn’t abide.”
Read their entire opinion piece HERE.
Heartland Institute: ‘Fake BBA is an Insult to Conservatives’ –
A commentary produced by Heartland Institute’s Justin Haskins, published by The Blaze on April 16, right after the US House failed to advance its proposed BBA, carried this headline: “GOP’s Fake Balanced Budget Amendment Plan is an Insult to Conservatives Everywhere”.
Haskins said, “the proposed amendment include(d), in the words of conservative Rep. Thomas Massie (R-Ky.), ‘a loophole you can drive a truck through’: If three-fifths of both houses of Congress approve, unbalanced budgets could be passed without delay.
The reason Congress, whether it’s run by Republicans or Democrats, will likely never pass a balanced budget amendment is because most members of Congress have a strong personal incentive to continue to run large deficits.”
The author suggests that “A balanced budget amendment is the only way to ensure the federal government acts responsibly. At this point, nothing else will work. But if Congress has no intention of passing a (meaningful) balanced budget amendment, how will this problem ever get resolved?”
Haskins concludes, “America’s only hope of averting fiscal disaster rests with a handful of states that have yet to pass balanced budget amendment applications.”
Read Haskins’ commentary HERE.
ALEC Calls for Congress to Support an Article V Convention –
Just before the US House voted on its version of a BBA, the American Legislative Exchange Council (ALEC) sent a letter to House Speaker Ryan and Senate President McConnell. The letter, over the signature of ALEC President Lisa Nelson was formally endorsed by 10 other organizations including Americans for Tax Reform, the Center for Freedom and Prosperity, FreedomWorks, and the BBA Task Force.
Headlined “Congress Needs to Get Serious About Balancing the Federal Budget,” the letter said, “The Congress, clearly unable to shake its overspending habit … (should) exercise its constitutional power under Article V to empower the states to draft, and the people to ratify, a Balanced Budget Amendment to the U.S. Constitution.”
In addition to encouraging the states to meet in convention to draft and propose new fiscal restraints on the federal government, the letter stressed its suggestion that any proposed BBA proposal should be sent to state conventions for ratification. It said: “the citizens of the United States of America should decide if they want to ratify a BBA that could be designed by their state representatives. In calling for a convention of the states, Congress could honor the principles of federalism and empower the American people to create a fiscally solvent future.”
Read the entire ALEC letter HERE.
‘Swiss Debt Brake’ Gets Increased Attention –
On April 4 the Heritage Foundation hosted a panel discussion entitled “Hitting the Brakes on Overspending and Debt”. The event highlighted the fiscal rules employed by the Swiss government to restrain national debt and expand its economy.
Participants included Jan-Egbert Sturm, Chairman of the Swiss Debt Brake Group of Experts; Barry W. Poulson, Emeritus Professor of Economics, University of Colorado and co-author of Can the Debt Growth Be Stopped?; and Ryan Bourne, R. Evan Scharf Chair for the Public Understanding of Economics, Cato Institute.
The entire hour-long discussion… focused on how a variation of the Swiss Debt Brake fiscal rules could be applied to the US government… can be watched/heard HERE.
A related article by Daniel J. Mitchell of the Cato Institute entitled “How the Swiss ‘Debt Brake’ Tamed Government” was published on April 26 by the Wall Street Journal. It can be read HERE.
ALSO RELATED: The April 13 edition of Investor’s Business Daily carried a commentary by Dr. Poulson and his associate John Merrifield, entitled, “Closing the Debt-Driven Fiscal Gap Just Got Harder,” the piece can be read HERE.
Article V Expert Addresses AV Fear Campaign –
The April 2 edition of The Hill carried an article by Professor Rob Natelson entitled “Convention for proposing amendments not as scary as big government advocates suggest”.
Natelson’s excellent article addresses the “renewal and quickening of a 50-year old campaign to dissuade Americans from calling a convention for proposing constitutional amendments.” He points out that the campaign “uses fear and disinformation to discourage citizens from exercising an important constitutional right.”
He also follows-up with logic and good reasons for ignoring such misinformastion and fear. Read his piece HERE.
Former Eagle Forum Leader Changed Her Position on Article V –
Laurie Lister Frost, a previous President of the Schole, AZ (130 miles NE of Phoenix) Eagle Forum Chapter, was a close friend of Eagle Forum founder Phyllis Schlafly. She suggests that “the Con Con” fears’ of many Eagle Forum members are misplaced.
Ms. Frost reports that after really studying Article V she has concluded that the founders “gave us Article V in the Constitution to use as our biggest tool … for proposing amendments to the Constitution… to strengthen the people, the states … to rein-in the power of the central government.” In a video released by the Convention of States Project, Ms. Frost calls on her fellow ‘Eagles’ to put aside unfounded fears.
“I have changed my view. It is simply because I have been educated.” About the founding fathers who wrote the Constitution, Ms. Frost says, “We need to honor them… they laid everything on the line. This is something we can do to honor our legacy of freedom.”
The CoSP video of Ms. Frost’s comments can be seen HERE.
The Article V Legislative Progress Report: An Update –
For the last few years Georgia Attorney David Guldenschuh has tracked Article V activity within state legislatures. His April 10 report shows that approximately 145 Article V items of Article V legislation have been introduced in 36 states this year.
Guldenschuh says, “The lack of successes within the Article V movement in 2018 suggests that each group (except US Term Limits) may be reaching its ceiling with its current funding mechanism. More resources will be needed to find success, particularly since the anti-Article V groups – Common Cause, John Birch Society, Eagle Forum and others – appear to be better funded. The lack of success also harkens back to my 2015 warning in my Heartland Institute Policy Brief that the advocacy groups needed to do a better job of coordinating their efforts lest they begin to cancel each other out. There is likely an air of Article V burnout in some state legislatures that is further tamping down our successes.”
See his entire commentary and current status report chart HERE.
A Closing Thought –
Tench Coxe was a Pennsylvania merchant, delegate to the Annapolis Convention of 1786, and the co-author with Alexander Hamilton of the Report on Manufactures (1791). Leading up to ratification of the 1787 US Constitution, Mr. Coxe wrote an address to the members of the Virginia Ratification Convention. It appeared in the Pennsylvania Gazette of May 21, 1788… with these closing words:
“They will remember the provision to obtain amendments,
and will recollect that the power will continue
with the people at large in all time to come.”