U.S. Representative John Carney (D-DE) today introduced H.J.Res 87, a joint resolution proposing a balanced budget amendment to the Constitution of the United States. The legislation is different from a House Republican balanced budget amendment that will be voted on later this week because Rep. Carney's legislation protects Social Security and allows for public investments by separating the federal capital and operating budgets. It also provides for extenuating circumstances by allowing outlays to exceed receipts in a time of economic recession, declared war, or imminent national security threat as voted on by Congress.
"In Delaware, we are responsible for balancing our budget each year while managing our obligations as a state. The federal government should not be held to a different standard," said Congressman Carney. "Right now, there's no revenue target and little accountability in the federal budgeting process. A responsible balanced budget amendment will enable us to end out-of-control deficit spending while making essential public investments that make sense to finance over time, like military aircraft, infrastructure, facilities, and intellectual property. This amendment will also protect Social Security and ensure that we can act quickly in times of war or economic recession."
The proposed amendment separates the federal capital and operating budget, requiring only the operating budget be balanced to ensure that the federal government can continue to pay for capital investments that are typically financed over the long-term, including bridges, military planes, and technology research. Many states have balanced budget amendments with the capital versus operating budget distinction, including Delaware. The Office of Management and Budget defines federal capital assets as "land, structures, equipment, intellectual property, and information technology having an estimated useful life of two years or more."
The proposed amendment also protects Social Security by preventing the federal government from using Social Security revenue for shortfalls elsewhere in the budget. In case of an economic recession, declared war, or an imminent national security threat as voted on by Congress, the proposed amendment allows outlays to exceed receipts. Any bill to increase revenue would require a majority vote in both houses of Congress.
Representatives Jared Polis (CO-02), Gerry Connolly (VA-11), Ed Perlmutter (CO-07) and Kurt Schrader (OR-05) are also original co-sponsors.