Blue Dogs offer balanced budget amendment to deal with debt

The legislation would require the federal government to pay
down the national debt — which is over $12 trillion — and balance the budget by
2020. This year’s budget deficit is projected to be $1.6 trillion.

“Talking about paying down the debt and balancing the budget
is easy,” Blue Dog Co-Chairman Jim Matheson (D-Utah) said in a statement. “It’s
where the rubber meets the road that Congress has fallen short.”

The amendment would require Congress to produce a balanced
budget every fiscal year, and require the president to submit a balanced budget
in an annual address to Congress.

{mosads}The proposal reflects rising worries among Democrats about
soaring deficits, which have caused independents to trend away from President
Barack Obama and congressional Democrats in many districts.

Voter worry and anger about the annual budget deficits,
which are projected to top $1 trillion for the next decade, are a large part of
the reason Republicans believe they can take back the House after the 2010
midterm elections.

The balanced-budget amendment was introduced by freshman
Rep. Bobby Bright (D-Ala.), one of the Democrats’ most vulnerable incumbents.

“There are many steps that must be taken to improve our
fiscal health, but balancing the budget on a yearly basis is the only way to
ensure that we don’t repeat the mistakes of the past that have created our
current situation,” Bright said in a statement.

Deficit worries have helped stymie healthcare and jobs
legislation. They led the Senate to agree to a “pay-go” law after years of
opposition, and to the House accepting a fiscal reform commission.

For the amendment to be added to the Constitution, both houses
of Congress would have to approve it with a two-thirds vote. Then three-fourths
of the state legislatures would also have to give their support, a daunting
task.

The Blue Dog action comes after former House Speaker Newt
Gingrich (R-Ga.) called for a balanced-budget amendment in an address to the
Conservative Political Action Conference in February.

The 52-member Blue Dog Coalition is fresh off a victory it
had spent it nearly two decades in existence fighting for — a law requiring
Congress to offset any new, non-emergency expenditures with either tax
increases or other spending cuts.

But many of those same Blue Dogs are once again unhappy over
the lack of offsets in the Senate-passed $15 billion jobs bill, and as a result
they’re withholding their support. Democratic leaders had deemed the jobs bill
“emergency legislation and exempt from “pay-as-you-go,” or “pay-go,” rules.

Adding a balanced-budget amendment to the Constitution could
make it tougher to bypass pay-go rules.

A Blue Dog fact sheet on the legislation doesn’t specify if
annual budgets would have to reach a zero balance each year.

Obama’s 2009 and 2010 budget proposals — and the 2009 budget
that Congress passed — contained short-term deficits while projecting returns
to balance and surpluses over the long term.

Similarly, many high-profile bills, including the healthcare
reform bill, have cost estimates that stretch out over 10 or 20 years, allowing
them to claim the title of “deficit-neutral” even thought their upfront costs
are significant.

The Blue Dog proposal would “prohibit outlays for a fiscal
year from exceeding total receipts for that fiscal year unless Congress, by a
three-fifths roll call vote of each house, authorizes a specific excess of
outlays over receipts,” according to a fact sheet on the legislation.

The fact sheet did not specify how these constraints would
apply to legislation that has multiyear cost and revenue implications.

Despite the difficulty of ratifying a constitutional
amendment and the constraints it would impose on budget writers, a senior Blue
Dog aide said the coalition believes the bill has “realistic chances” of
picking up momentum.

Spokesmen for House Speaker Nancy Pelosi (D-Calif.) were not
available for comment, but in a statement Majority Leader Steny Hoyer (D-Md.)
said the idea was “welcome.”

“Blue Dogs have consistently put forward serious ideas to
restore our nation’s fiscal responsibility,” Hoyer said. “As we remain focused
this year on reducing the deficit, all proposals about how to achieve that goal
are welcome.”