One of several provisions of a debt ceiling agreement floated by Republicans is that both houses of Congress pass a Balanced Budget Amendment (BBA) resolution. Not a new idea – all states but Vermont currently have balanced budget requirements. Germany and Switzerland both have balanced budget provisions in their constitutions. In a letter to John Taylor of Caroline on November 26, 1798, Thomas Jefferson wrote:

“I wish it were possible to obtain a single amendment to our Constitution. I would be willing to depend on that alone for the reduction of the administration of our government; I mean an additional article taking from the Federal Government the power of borrowing. I now deny their power of making paper money or anything else a legal tender. I know that to pay all proper expenses within the year would, in case of war, be hard on us. But not so hard as ten wars instead of one. For wars could be reduced in that proportion; besides that the State governments would be free to lend their credit in borrowing quotas.”

Since 1975, 32 states have petitioned Congress to consider a BBA. Should two additional states issue similar petitions, some contend Congress would then be required to call a Constitutional Convention, in accordance with Article 5 of the US Constitution, to consider the BBA.

There is currently a joint resolution in Congress to pass a BBA.


Proposing an amendment to the Constitution of the United States relative to balancing the budget.

Resolved by the Senate and House of Representatives of the United States of America in Congress assembled (two-thirds of each House concurring therein), That the following article is proposed as an amendment to the Constitution of the United States, which shall be valid to all intents and purposes as part of the Constitution when ratified by the legislatures of three-fourths of the several States:


Section 1. Total outlays for any fiscal year shall not exceed total receipts for that fiscal year, unless two-thirds of the duly chosen and sworn Members of each House of Congress shall provide by law for a specific excess of outlays over receipts by a rollcall vote.

Section 2. Total outlays for any fiscal year may not exceed 20 percent of the gross domestic product of the United States for the calendar year ending before the beginning of such fiscal year, unless two-thirds of the duly chosen and sworn Members of each House of Congress shall provide by law for a specific amount in excess of such 20 percent by a rollcall vote.

Section 3. Prior to each fiscal year, the President shall transmit to the Congress a proposed budget for the United States Government for that fiscal year in which total outlays do not exceed total receipts.

Section 4. No bill to increase Federal taxes shall become law unless approved by two-thirds of the duly chosen and sworn Members of each House of Congress by a rollcall vote.

Section 5. The Congress may waive the provisions of this article for any fiscal year in which a declaration of war is in effect. The provisions of this article may be waived for any fiscal year in which the United States is engaged in military conflict which causes an imminent and serious military threat to national security and is so declared by a joint resolution, adopted by a majority of the duly chosen and sworn Members of each House of Congress, which becomes law.

Section 6. The Congress shall enforce and implement this article by appropriate legislation, which may rely on estimates of outlays, receipts, and gross domestic product.

Section 7. Total receipts shall include all receipts of the United States Government except those derived from borrowing. Total outlays shall include all outlays of the United States Government except for those for repayment of debt principal.

Section 8. This article shall take effect beginning with the fourth fiscal year beginning after its ratification.

There have been discussions of changes to the supermajority requirements, from two thirds to three quarters, as well as whether 20% of GDP is the appropriate limit. Amendments have also been proposed requiring state ratification of all increases to the debt ceiling, which would be intended to supplement rather than replace the BBA and would be of little effect if the BBA were properly enforced – a belt and suspenders approach.

Criticism of a BBA largely centers around the Keynesian argument that deficit spending is necessary in times of recession, though this particular argument seems to be dulled if not entirely refuted by recent attempts to dampen the recession with historic annual deficits. Given the clear propensity for members of the Executive and Legislative branches, including many who claim to fly the flag of fiscal conservatism, to consider prior year spending as the budget baseline, expecting a change to that approach absent a Constitutional requirement seems unrealistic at best.

With current debt exceeding $14 trillion, any agreement to allow an increase should come with passage of the joint resolution. The President is right……..enough is enough.

Is it Time for a Balanced Budget Amendment?

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