Remarks on the Balanced Budget Amendment
April 13, 2018
Mr. Speaker, today we are scheduled to engage in a recurring ritual of fiction and fantasy consideration of a so-called Balanced Budget Amendment.
Budgets, expenditures and revenues, are simply a statement of our priorities. It is not difficult to devise a plan which addresses the urgent needs of our people, while providing flexibility for national security emergencies, natural disasters, economic crises. The Congressional Progressive Caucus and the Congressional Black Caucus have submitted such budgets every year and I have proudly cast my vote for these progressive programs each year.
Mr. Speaker, contrary to the unsubstantiated claims of the chicken little imitators, the sky is not falling and there is no debt crisis. As Federal Reserve officials have noted many times, the United States can pay its debt because 100% of our debt is in dollars and we can always print money to do that. Inflation is very moderate and under control. There is zero probability of default.
The proposed simpleminded, bureaucratic approach of the BBA says nothing about our national priorities, about what to do about massive and growing economic inequality, about addressing the impact of globalization on the American people. It says nothing about infrastructure for sustainable energy, water, transportation, communication. It says nothing about health care, education, housing, or Social Security.
It says nothing about addressing the great inequities facing women, African Americans, Hispanics, Native American, the LGBTQ community, the disabled, the homeless, the opioid epidemic. It says nothing about global climate change or basic scientific research.
The BBA would force policymakers to cut federal programs, raise taxes, or both when the economy is weak or already in recession — the exact opposite of what good economic policy would advise.
It ignores our history. Franklin Roosevelt’s efforts to address the Great Depression by deficit spending reduced unemployment from 25% to 14%. That is until he was pressured by deficit hawks to balance the budget. Unemployment jumped back to 19%.
According to a 2011 study during the last Congressional debate on a BBA during the Great Recession, a BBA would have caused the 2012 unemployment rate to double from 9 percent in that year to 18 percent by throwing an additional 15 million people out of work.
A BBA would wipe out trillions of dollars of Social Security, Medicare, military and civil service retirement trust funds, and Federal Deposit Insurance Corporation and Pension Benefit Guaranty Corporation trust funds since they could not draw down the balances they has accumulated in previous years to pay benefits in a later year.
At a time when our nation may be heading for a Constitutional crisis because Congress is unable to find a simple majority for legislation guaranteeing no one man is above the law, a BBA would create an ongoing scenario of endless potential Constitutional crises should Congress be unable to find super majorities to resolve budget shortfalls creating the threat of political extortion by a congressional minority. The BBA is a direct attack on our democracy.
Those who promote the fetish of the national debt, the Herbert Hoovers of our day, are often those engaged in the perennial campaign to cut Social Security, Medicare and Medicaid. Perhaps it is no coincidence that no sooner had we finally passed this year’s budget with its looming trillion dollar deficits, then we began hearing demands for “entitlement reform.” Mr. Speaker, perhaps we should initiate a national warning system, similar to our urgent warning system for dangerous weather: whenever the cry goes out for a BBA seniors and low income Americans need to be warned to rise up to protect Social Security, their Medicare and Medicaid.
Mr. Speaker, it is time to tear down this facade of economic gobbledygook which obscures the predatory essence of the BBA and vote this zombie down decisively.