Scheduled for consideration on the Georgia House floor today are several bills that aim to put a brake on the growing federal debt by adopting an amendment to the U.S. constitution that would require a balanced budget. The amendment would be proposed and adopted via Article V of the constitution, which allows for a constitutional convention if requested by two thirds of the states. From Article V:
The Congress … on the application of the legislatures of two thirds of the several states, shall call a convention for proposing amendments, which, in either case, shall be valid to all intents and purposes, as part of this Constitution, when ratified by the legislatures of three fourths of the several states, or by conventions in three fourths thereof, as the one or the other mode of ratification may be proposed by the Congress…
The first bill to be considered is HB 794, sponsored by Paulette Braddock. The bill would create a ‘compact’ binding Georgia and other states adopting the same compact to specific actions and requirements during an Article V convention.
House Resolution 1215, sponsored by Rep. Buzz Brockway, is the application to Congress for a Convention of States under Article V.
Senate Bill 206, sponsored by Bill Cowsert, provides for Georgia to send a delegation to an Article V convention, and limits delegates to voting only on amendments authorized by the state. The accompanying Senate Resolution 371 calls for an Article V convention.
Restraining Federal spending and having a balanced budget are important goals for conservatives. The push for an Article V convention is a response from those who are frustrated that our representatives and senators in DC are unable to solve the problem on their own. Concerns that a constitutional convention could lead to unintended consequences of additional amendments are valid, since the Constitution itself does not provide any limits once a convention is called. Proponents of the Article V convention movement insist that with the compacts and restrictions contained in the Call for the convention, these concerns are unwarranted.
I will leave it to our commenters to discuss the pros, cons and risks of an Article V convention.
My question, however, is what happens if the amendment passes?
In FY 2014, we will spend almost $3.8 trillion dollars. This will lead to a $744 billion shortfall, according to usgovernmentspending.com. If a balanced budget amendment were in effect today, we would have to raise taxes or reduce spending by that amount. Health care (Medicare, Medicaid, Obamacare) and pensions (Social Security) account for 50% of federal spending. Other welfare payments make up 11%, and 22% is spent on defense. That leaves 17% for everything else.
The 2014 deficit is 19% of federal spending.
Bonus thought: Interest on the debt is 6% of spending. That’s because the Federal Reserve, through quantitative easing, is keeping interest rates artificially low. If the Fed were to allow interest rates to rise to normal levels, the money needed to pay the interest would be about the same amount, $1.2 trillion, as the country brings in from personal income taxes.