Wednesday, March 29, 2017

Balanced Budget Amendment Disaster pushed by Wisconsin's Clueless CPA Caucus' Chris Kapenga!!!

While doing research on what it would mean to have a balanced budget amendment, I turned up this interesting statement from 2012 at the National Memo:
The Lie: Republicans have a plan to balance the federal budget and care deeply about fiscal responsibility.
Backing that statement up was easy:
The Truth: The last Republican president who ever balanced the budget was Dwight Eisenhower.

Between 1998 and 2000, President Bill Clinton’s Treasury Department paid off more than $360 billion in debt. As a result of 115 straight months of economic expansion that began after an increase in the top income tax rate — which was virulently opposed by the right — the huge deficits left by 12 years of Republican rule had been transformed into a surplus.

Within months after taking office George W. Bush had begun to turn that surplus back into deficits that grew and grew, despite funding two wars on emergency supplemental bills that were not figured into the budget.

Vice-President Cheney laughed off the promises that the Bush tax breaks would pay for themselves and the budget would be balanced: “Reagan proved deficits don’t matter.” But deficits do matter to Republicans…whenever there is a Democratic president.
Hey Look Everybody, We're good with Money, We want to Balance the Budget!!! Phony baloney Wisconsin Republicans are now ballyhooing their attempt to become the 30th state to ask for a balanced budget amendment via a constitutional convention. It's all show, especially when you consider all the cuts Republicans want to make locally and on a federal level that will just end up costing taxpayers much more money in the long run. Penny wise, pound foolish...you bet. 

It should be embarrassing that CPA caucus loudmouth Rep. Chris Kapenga thinks the balanced budget amendment is a good idea. It calls into question his credibility, first, and says more about his blind ideological positions: 
The Senate sponsor of the resolutions, Chris Kapenga, R-Delafield, called them “one step further to putting our nation’s house in order. Debt was the downfall of most civilizations. We’ve never seen this type of debt before.” Assembly Speaker Robin Vos has signed on to the resolution requesting a constitutional convention.
The arguments against one of the dumbest political movements isn't connecting logically with Republicans:
Opponents, Democratic lawmakers and left-leaning advocacy groups as well as the John Birch Society, a far-right advocacy group say a balanced budget amendment would make it harder for the federal government to respond to economic downturns and natural disasters.

"It's like the economy has cancer and you won't let the economy get chemotherapy or radiation, it's like the economy has diabetes and you won't give the economy insulin — you'd be killing the economy," said Matt Rothschild, executive director of the Wisconsin Democracy Campaign.

Many economists say federal deficit spending can be necessary to fund wars, combat economic recessions or respond to natural disasters. A balanced budget requirement could severely hamstring the federal government’s ability to respond to those situations, critics say.
Scapegoats and Someone to Blame: Besides the Republican driven deregulation of Wall Street that gave us the Great Recession, these "concerned" flip-floppers are the ones that built up our deficits:
Using the deficit as a battering ram, the GOP pushed for the rapid adoption of a Balanced Budget Amendment to the Constitution, which would ignore the true causes of the deficit—tax breaks, the wars and an unfunded Medicare expansion—and demand huge cuts to Medicaid, Pell Grants and every service the government provides.
Keep in mind, it took me under an hour to uncover many of the reasons why a balanced budget amendment would be an economic disaster for the country. Why didn't our Republican "CPA Caucus" spend a little time boning up on the issues? You can't tell me the following list of bad outcomes doesn't raise some extremely serious questions?:
When the economy slows, federal revenues decline or grow more slowly and spending on unemployment insurance and other social programs increases, causing deficits to rise ... the amendment would force policymakers to cut spending, raise taxes, or both. That would launch a vicious spiral of bad economic and fiscal policy ... The fact that states must balance their budgets every year makes it even more important that the federal government not also face this requirement and thus further impair a faltering economy. 

Raise other problems ... Social Security could not draw down its reserves from previous years to pay benefits in a later year but, instead, could be forced to cut benefits even if it had ample balances in its trust funds, as it does today. The same would be true for military retirement and civil service retirement programs. Nor could the Federal Deposit Insurance Corporation or the Pension Benefit Guaranty Corporation respond quickly to bank or pension fund failures by using their assets to pay deposit or pension insurance, unless they could do so without causing the budget to slip out of balance.

The amendment’s proponents often argue that, because states and families must balance their budgets each year, the federal government also should do so. But this analogy is a false one. Families borrow — they take out mortgages to buy a home or student loans to send a child to college. They also draw down savings when times are tight to cover expenses that exceed their current incomes. The proposed constitutional amendment would bar the federal government from making worthy investments in the same way.
And then there's the enforcement mechanisms...
Suppose the budget is out of balance. What happens? Would the President have the unilateral power to impose balance? Suppose, for example, that a reconciliation bill designed to balance the budget is defeated at the end of the congressional session. Can the President unilaterally declare that it is law nonetheless? Can he instead make across-the-board cuts in all spending, including Social Security, Medicare, and defense, without congressional action? Can he select which programs to cut unilaterally? Can he impose across-the-board, or selected, increases in tax rates? How about across-the-board or selected reductions in tax expenditures?

What about the Supreme Court? If the budget is not balanced, can the Court declare a defeated reconciliation bill to be law? Can it override a presidential veto of a reconciliation bill? If it cannot enact a defeated or vetoed law, can it declare that a bill allowing a deficit as having been enacted if it received a majority vote but not a three-fifths vote? Alternatively, can it invalidate appropriation bills, in reverse chronological order? If that seems arbitrary and unworkable, can it order across-the-board cuts in all appropriations, or entitlement programs, or tax expenditures? Can it impose across-the-board surtaxes? Can it hold Congress or the President in contempt and possibly jail them if they ultimately do not act?

If federal courts award claims or judgments against the United States, as they often do, but the costs would unbalance the budget and require an increase in the debt limit, what action would the courts take?

No comments: