Demand a Balanced Budget Amendment that Does Not Raise Taxes
American prosperity has been gravely threatened by runaway spending, increasing debt and deficits, and a political class that refuses to make the tough decisions necessary to restore order to the nation’s fiscal house. A balanced budget amendment to the Constitution that limits spending and protects families from tax increases will force Washington lawmakers to finally make the tough decisions about federal spending priorities.
While some inside the Beltway have advocated a so-called “balanced” approach that would raise taxes on middle-class families who are already struggling to pay their bills, innocent American families should not be forced to forever pay the tab run up by spendthrift politicians. Congress must send a balanced budget amendment to the states as soon as possible to begin the process of getting the federal government’s spending and debt problems under control.
Cap Federal Spending at 18% of GDP and Balance the Budget by 2020
If the federal budget is ever going to be balanced – the first step that must be taken before America’s enormous debt burden can be reduced – federal spending must be capped at 18% of GDP to avoid a tax burden that far exceeds the national historical average. Since 1960, the ratio of total federal tax receipts to GDP has averaged 18%.71
The country’s debt and deficit problems were not created overnight and will not be solved overnight. Further, the current economic crisis requires immediate tax reform and tax reductions to spur growth that will increase the time it takes to get to balance, but will put the nation on stronger long term footing. A gradual step-by-step process that acknowledges the political realities of deficit reduction will be required to put the country back on the path to fiscal sanity.
Credible and workable plans to balance the budget within ten years by reforming entitlements and curbing discretionary spending have been proposed in both houses of Congress. A proposal put forth by Sen. Pat Toomey of Pennsylvania balances the budget by 2020 and sets federal spending equal to 18.4% of GDP.72 The Republican Study Committee budget proposal in the House also balances in 2020 at federal spending equal to 18% of GDP.73 Workable balanced budget proposals have also been proposed outside Congress. The “Saving the American Dream” plan prepared by the Heritage Foundation reduces federal spending to 18% of GDP by 2019 and reaches balance by 2022.74
By working with committed lawmakers who have put forth detailed and credible budget proposals, the president and Congress and eliminate the federal deficit by 2020.
Reduce Non-Defense Discretionary Spending by $100 Billion in the First Year
Americans who depend on entitlement programs like Medicare and Social Security will not trust lawmakers to tackle entitlement reform until they have proven they can eliminate waste and duplication from the discretionary budget. By cutting non-defense discretionary spending by $100 billion and restoring it to 2008 levels, Washington can demonstrate that it is serious about making the tough decisions necessary to balance the budget. Sen. Tom Coburn recently proposed $9 trillion worth of specific ideas on how to reduce federal spending.
Consolidating Department of Education funding for all elementary and secondary programs, reducing it by 50 percent, and returning the rest of the money to the states would save $25 billion in the first year.75 Reducing the portfolio of investments by government-sponsored enterprises like Fannie Mae and Freddie Mac would save $26.5 billion over ten years.76 And repealing the Davis-Bacon Act and paying market-based wages would save $11.4 billion.77
Institute Automatic Government Shutdown Protection
American troops overseas and senior citizens should not have to worry about their income security because Washington politicians refuse to do simple things like pass a budget or fund the government. They should not be used as hostages in a partisan political battle to see which party can hold out the longest before the other blinks. Automatic government shutdown protection would fund discretionary federal spending at the previous year’s level of spending if no budget or specific spending bills were signed into law before the end of a fiscal year.
... eliminate the federal deficit by 2020.
Which is it? Balance the budget by 2020 or eliminate the deficit by 2020? There's a $15,000,000,000,000 difference. In his speech he said "balance the budget by 2020" which means increase the deficit for up to eight more years. If I'm interpreting this wrong I would appreciate someone explaining it to me. Please use simple terms that even I can understand and don't spam me. Thank you.