Balanced budget amendment likely to pass Congress Frustration over ever-increasing deficit drives support for the bill.

April 29, 1992|By Boston Globe

WASHINGTON -- Almost unnoticed, Congress is poised to approve a constitutional amendment to require a balanced budget, the first step in a process with potentially greater implications for society and the economy than anything the voters will decide in November.

Driven by frustration that the budget deficit is headed for a record $368 billion this fiscal year and by fear that the public is prepared to wreak vengeance on a Washington apparently unable to solve the nation's major problems, Congress is expected to vote on the measure by midsummer.

In interviews this week, politicians of both parties said that short of a procedural move to sidetrack it, the measure will almost certainly pass, even though it would require a two-thirds vote of each house and would ultimately lead to wholesale spending cuts, massive tax increases and the potential for renewed recession.

"This is the economic equivalent of Prohibition," said an aide to a Democratic congressional leader, who nevertheless said passage was all but a foregone conclusion.

The congressional vote is only the first step. Legislative majorities in 38 states must also ratify the proposal within seven years. But here, too, approval seems increasingly likely. Thirty-two states already have called for a balanced-budget amendment, and House Speaker Thomas S. Foley, an opponent, predicted last week that ratification could be completed within a year.

If the amendment is approved, supporters and detractors agree, it would drastically alter both the federal government and the workings of the economy. Besides forcing spending cuts and tax increases, it would largely eliminate Washington's ability to manage the ups and downs of the free market, which has been one of its primary duties since the Great Depression.

"It would require a traumatic change in how the federal government operates," Mr. Foley said recently.

William A. Niskanen, a former Reagan administration economist and longtime proponent, said, "It would change all the rules on borrowing and taxing." Mr. Niskanen is scheduled to testify on the proposal before the House Budget Committee today.

The last constitutional amendment, which gave 18-year-olds the right to vote, was approved in 1971.

The budget amendment's sudden emergence as a live possibility is a yardstick of the frustration and political breakdown sweeping both the capital and the country. Although the idea surfaced repeatedly in the last decade, making it to a vote in one house or the other three times, it has always slipped back into political limbo.

But with the budget deficit refusing to yield to high-profile efforts by Congress and the president to cut it, and with government in general in growing disrepute, both sides say the measure is becoming more appealing as a means of gaining political advantage and demonstrating to voters that Washington is ready to act.

Republicans see the proposal as a potent weapon in their fight to shake Democratic control of Congress. For a Democrat seeking re-election, "a vote against this amendment would be a horrendously stupid vote, one that would qualify the member for a Profiles in Courage award from the JFK Library," said William D. McInturff, a principal with the Republican polling firm Public Opinion Strategies.

But Democrats, too, have begun to embrace the proposed amendment as a means to short-circuit Republican attacks and because many have concluded that the deficit and the government's burgeoning interest bill are greater threats than the amendment itself. Both Sen. Paul Simon, a liberal Illinois Democrat, and Rep. Joseph P. Kennedy II, a liberal Massachusetts Democrat, are sponsoring versions of the measure.

"The fact is, the only way to save the programs we care about is to reduce interest expenditures," said Mr. Simon, who is the amendment's chief Senate sponsor.

But even as politicians of all stripes line up behind the amendment, many economists remain firmly against the measure. They predict that it would do little to cut the deficit and would sharply reduce the government's ability to even out economic swings.

"This seems to me to be an act of complete unrealism," said Robert Solow, a Nobel Prize-winning economist at the Massachusetts Institute of Technology.

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