Should America Pass a Balanced Budget Amendment?
Under no circumstances would such a thing help. Not if the United States wants to survive in the long-term. That may sound like hyperbole, but let’s take a quick stroll through some of the historical things that simply wouldn’t have been possible if we had a Balanced Budget Amendment.
Firstly, the Revolutionary War was funded through huge debts incurred by the Continental Congress to pay for arms, ammunition, ships and supplies. The United States’ victory during the Civil War was only possible due in part to issuing bonds and deep deficit spending by Lincoln. World War 2 was waged long before Americans engaged in open hostilities with Axis forces through the Lend-Lease Act in supporting the embattled isle of Britain with convoys of food and supplies bought on credit. Pearl Harbor would have been a death knell for the U.S. in the Pacific without huge spending to get an entire war economy running to rebuild our naval fleet. Even Reagan during the Cold War knew that debt spending was required to achieve and maintain a stalemate in the nuclear arms race and signed every one of his budgets to that effect.
Don’t get the wrong idea – it is not only in war that America cannot brook a Balanced Budget Amendment. We bought the Louisiana Purchase with money we didn’t have, doubling the size of our country. Alaska was similarly purchased for 2 cents an acre. Eliminating the ability to run a national deficit would also prohibit the government from responding speedily to disasters, like a Fukushima-style meltdown or a terrorist attack. Congress would have to find cuts to other parts of the budget before federal funding could be released for a response. There is also a danger in that it could give the courts a legal say in the budget process, contravening the Constitution granting Congress the sole power of the purse.
A balanced budget amendment may sound smart at face value, but there are far too many pitfalls and moments in our country’s history where such a thing would have lead us off a cliff or made it impossible for us to pursue a grand opportunity.