A theoretical analysis of the case for a balanced budget amendment

✍ Scribed by William R. Keech

• Publisher: Springer US
• Year: 1985
• Tongue: English
• Weight: 752 KB
• Volume: 18
• Category: Article
• ISSN: 0032-2687
• DOI: 10.1007/bf00136719

✦ Synopsis

A balanced federal budget is not a best outcome for all situations, and a constitutional amendment to require annually balanced budgets is not well defended on grounds that it is. However, the case for a balanced budget amendment may have some merit on other, subtler grounds. This article outlines a set of such grounds.

Specifically, if it can be shown that the political process systematically undervalues a desirable relationship between revenues and expenditures, a balanced budget requirement might be defensible. The grounds would be that annually balanced budgets are a second best solution, given an argument that the unconstrained political process produces even less desirable outcomes. However, existing knowledge does not make an adequate case that such a rule is needed.