Five Year Balanced Budget
Patrick Ruffini thinks one way out of our national fiscal nightmare is to adopt, like 49 of the 50 states, a balanced budget amendment. Recognizing that this has had the perverse effect of profligate spending in flush years and irresponsible cuts in lean years, he suggests a five year cycle:
In bad times, states could deficit spend — by no more than the surpluses of the previous four years. In good times, states would be forced to bank surpluses — particularly if the past few years were economically tough.
Given that legislators are mostly elected on two-year cycles, the most likely effect of this would be to exacerbate the problem. They’d still spend like drunken sailers when the money’s available, deficit spend when allowed, and then have draconian cuts if necessary in the fifth year. Or come up with cute budgetary tricks to create a budget that’s “balanced” on paper by shifting the spending to January 1 of the next year or somesuch.
Is this the first Five Year Plan?
Yeah, the Communist allusion occurred to me as well. Then again, we’re nationizing everything and redistributing on the basis of “to each according to his needs…” so why not.
I thought it was amusing. And showed how much time had passed.
Perhaps a running 5 year average. This would allow deficit spending and force saving depending on where the current cycle is compared to the average.
If I was handed the pen to draft an amendment, I would look more towards capping the percentage of Americans who could receive government assistance to 25% and that 75% have to pay taxes. This would help keep the ‘bread and circuses’ to a minimum.
Or as an alternative, change how we elect senators again, but this time make it based on federal tax dollars paid (with a minimum of 1 for everyone). The would have brought a screeching halt to the stimulus bill.
I associate this sort of economic non-thinking with the 80’s, and especially with Phil Gramm. It’s too late to inject this into the thread below, but I’ve never understood why he has any reputation at all on budgetary and economic matters, since his advice and prognstications have always been so wrong.
From the idiocy of the Gramm-Rudman attempts to rein in the deficit by abandoning Congress’s role in actually making decisions on what to spend on and which proved easy to get around (as anyone else would have predicted), to his frequent declarations that Clinton’s 1993 budget was going to kill the economy, to his repeal of Glass-Steagel, he has been consistently wrong, and his failures have been consistently ignored by the so-called liberal media. If McCain had won last fall, this is the record of accomplishment we would have had with our new Treasury Secretary, with a free hand under a President who admitted to knowing nothing about economics. Bleah!
We’ll see who is serious about fiscal responsibility when we see who endorses the new Obama deficit plan.
It looks centrist, and practical, to me.
(I’d say “pragmatic” but I remember that is a bad word at OTB)
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