Sacred Cows or a Balanced Budget

June 21, 1992

The proposed balanced budget amendment to the Constitution, defeated in the House of Representatives for all the wrong reasons, will come back like a bad penny next year unless Congress starts cutting deeply into the pending $400 billion deficit for all the right reasons.

What could be the beginning of a rebellion against government spending started this past week. The House unexpectedly killed the $8.2 billion superconducting super collider and Democrats the next day accepted a $1.1 billion urban aid bill only half as large as they wanted. Next on the hit list could be the multi-billion-dollar space station.

Whether Congress can muster the will to balance the budget, which is a lot different than pretending to do so by messing with the Constitution, will require more fundamental structural changes than a few whacks of the ax.

In recent years, the much-heralded Gramm-Rudman Act of 1986 flopped and the 1990 budget agreement was not much better. These initiatives failed primarily because they did not stop the hyper-growth of such sacred-cow mandated entitlement programs as Medicare, Medicaid, veterans benefits, farm subsidies and (dare we utter the words?) Social Security. Instead, deficit limitation, or what there was of it, was restricted to cuts in non-automatic annual outlays.

What should this Congress do to start real deficit cutting so the next Congress does not resort to constitutional amendment show-boating? The last, best hope for constructive action lies with the House Budget Committee, which finally is trying to come up with a plan to bring entitlement spending under control. This, in our view, is key. It is far more important than a charted path to a balanced budget by 1998 or the fiercely partisan squabble now in committee over how much of a role tax increases should play in slashing yearly deficits.

Optimists should be on the lookout for cooperation between Rep. Leon Panetta, D-Calif., the committee chairman, who led the fight against a constitutional amendment, and Rep. Charles Stenholm, D-Texas, the amendment's chief sponsor. Though foes in that battle, they are among the more responsible deficit-fighters in the House; if they find common cause, something good might materialize.

While we welcomed the defeat of the balanced-budget amendment in the House June 12, we were dismayed that it came about chiefly through the lobbying of golden-age groups, which care only about milking government benefits to the ultimate, and the U.S. Chamber of Commerce, with its doctrinaire opposition to higher taxes. These groups were not against a balanced budget amendment per se but against balancing the budget period.

If this Congress does not turn around and repudiate them with a credible budget enforcement proposal, the next Congress may make a constitutional amendment, with all its flaws, its first order of business. And next time, this mischievous proposal may win.

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