A Balanced Budget Constitutional
Amendment: Background and Congressional
Options

James V. Saturno
Section Research Manager
Megan Suzanne Lynch
Analyst on Congress and the Legislative Process
July 8, 2011
Congressional Research Service
7-5700
www.crs.gov
R41907
CRS Report for Congress
P
repared for Members and Committees of Congress

A Balanced Budget Constitutional Amendment: Background and Congressional Options

Summary
One of the most persistent political issues facing Congress in recent decades is whether to require
that the budget of the United States be in balance. Although a balanced federal budget has long
been held as a political ideal, the accumulation of large deficits in recent years has heightened
concern that some action to require a balance between revenues and expenditures may be
necessary.
The debate over a balanced budget measure actually consists of several interrelated debates. Most
prominently, the arguments of proponents have focused on the economy and the possible harm
resulting from consistently large deficits and a growing federal debt. Another issue involves
whether such a requirement should be statutory or made part of the Constitution. Some
proponents of balanced budgets oppose a constitutional amendment, fearing that it would prove to
be too inflexible for dealing with future circumstances.
Opponents of a constitutional amendment often focus on the difficulties of implementing or
enforcing any amendment. Their concerns have been numerous and varied. How would such a
requirement affect the balance of power between the President and Congress? Between the
federal courts and Congress? Although most proponents would prefer to establish a balanced
budget requirement as part of the Constitution, some advocates have suggested using the untried
process provided under Article V of the Constitution for a constitutional convention as an
alternative to a joint resolution passed by two-thirds vote in both houses of Congress. Although
the inclusion of a balanced budget amendment as part of the congressional agenda has muted this
debate in recent years, proposals for a convention are still possible, and raise concerns that one
might open the way to an unpredictable series of reforms. The last American constitutional
convention convened in May 1787 and produced the current constitution.
These are also questions that will be raised and considered by Congress concerning the provisions
that should be included in such a measure as it sifts through its options. Congress ultimately will
decide whether consideration should be given to a constitutional requirement for a balanced
budget; and if it decides to proceed, it will need to decide whether there should be exceptions to
the requirement, or if it should include provisions such as a separate capital budget or a limitation
on expenditures or revenues. For example, as reported from the House Judiciary Committee,
H.J.Res. 1 in the 112th Congress includes provisions that would require a super majority to allow
a budget with outlays in excess of receipts, to allow outlays to exceed 18% of the “economic
output” of the United States regardless of whether the budget were balanced, to increase the debt
limit, or to increase revenues.
This report provides an overview of the issues and options that have been raised during prior
consideration of proposals for a balanced budget constitutional amendment. It will be updated as
events warrant.


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A Balanced Budget Constitutional Amendment: Background and Congressional Options

Contents
I. Introduction ............................................................................................................................. 1
The Deficit as an Issue .......................................................................................................... 1
The Call for a Balanced Budget Amendment ......................................................................... 2
The Debate in Recent Decades .............................................................................................. 3
II. The Constitutional Amendment Approach............................................................................... 8
Arguments of Proponents ...................................................................................................... 8
Arguments of Opponents..................................................................................................... 10
Concerns an Amendment Would Need To Address .............................................................. 11
III. Congressional Consideration of Proposed Constitutional Amendments ................................ 12
Hearings on a Balanced Budget Amendment ....................................................................... 14
Floor Consideration of Amendment Proposals ..................................................................... 14
97th Congress ................................................................................................................ 15
99th Congress ................................................................................................................ 16
101st Congress............................................................................................................... 16
102nd Congress.............................................................................................................. 16
103rd Congress .............................................................................................................. 18
104th Congress .............................................................................................................. 19
105th Congress .............................................................................................................. 22
108th Congress .............................................................................................................. 22
112th Congress .............................................................................................................. 23
IV. A Constitutional Convention ................................................................................................ 23
V. The Statutory Approach ........................................................................................................ 25
Previous Legislation............................................................................................................ 26
Gramm-Rudman-Hollings............................................................................................. 27
VI. Analysis of Typical Provisions of Proposed Balanced Budget Amendments ......................... 28
Use of Estimates ................................................................................................................. 28
Super-Majority Requirements ............................................................................................. 30
Presidential Responsibility .................................................................................................. 31
Coverage and Exemptions................................................................................................... 32
Off-Budget Activities .................................................................................................... 32
Non-Budgetary Activities.............................................................................................. 33
Waivers......................................................................................................................... 33
Debt.................................................................................................................................... 34
Tax or Expenditure Limitations ..................................................................................... 35
Judicial Review................................................................................................................... 38

Tables
Table 1. Federal Surplus/Deficit and Debt: FY1969-FY2010 ....................................................... 4
Table 2. Senate Judiciary Committee Hearings On Balanced Budget Amendments .................... 13
Table 3. Joint Resolutions Proposing Balanced Budget Amendments Reported by the
Senate Judiciary Committee ................................................................................................... 15
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Table 4. States That Have Petitioned Congress for a Constitutional Convention to Propose
a Balanced Budget Amendment.............................................................................................. 24
Table 5. Deficit Targets as Provided by the Balanced Budget and Emergency Deficit
Control Act of 1985 and 1987 Reaffirmation .......................................................................... 27
Table 6. Federal Outlays and Receipts as a Percent of GDP ....................................................... 38
Table A-1. Comparison of Deficit Projected in Presidential Budget Submissions and
Actual Amounts, FY1965-FY2010 ......................................................................................... 40

Appendixes
Appendix A. Comparison of Deficit Projected in Presidential Budget Submissions and
Actual Amounts, FY1965-FY2010 ......................................................................................... 40
Appendix B. Legislative History of the Balanced Budget Provision in 31 U.S.C. 1103 .............. 42

Contacts
Author Contact Information ...................................................................................................... 43

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A Balanced Budget Constitutional Amendment: Background and Congressional Options

I. Introduction
The debate over the need to establish a constitutional limit on spending or debt is nearly as old as
the nation itself. Thomas Jefferson is often cited as an intellectual forefather in the current debate
because of his distrust of government debt. He once wrote that the way to cure what he felt was
extravagant spending by the Administration of John Adams was a constitutional amendment that
took away the power of the federal government to incur debt.1 Support for such an idea has
waxed and waned continuously since that time. Support was echoed in the “Contract With
America” advanced by Republican House candidates during the 1994 congressional campaign,
and by the wide consensus on a balanced budget as a political ideal, especially since the late
1970s. The current call for a constitutional amendment to require a balanced budget reflects its
status as one of the most persistent political issues of recent decades. In the current Congress, the
House Judiciary Committee has reported a proposal, H.J.Res. 1, that includes provisions that
would require a super majority to allow a budget with outlays in excess of receipts, to allow
outlays to exceed 18% of the “economic output” of the United States regardless of whether the
budget were balanced, to increase the debt limit, or to increase revenues.
Generally the term balanced budget simply refers to a situation wherein the annual expenditures
made by the government are equal to its receipts. Disagreement about just exactly how these key
components should be defined and measured has been one of the chief stumbling blocks in the
consideration of balanced budget proposals. Although these sound like straightforward concepts,
this definitional problem is far from trivial; any sound definition must say what is to be included
and, at least by inference, who is to be responsible for insuring that its provisions are carried out.
When coupled with additional provisions, as with H.J.Res. 1, the debate takes on even greater
complexity.
The Deficit as an Issue
The goal of balancing the budget was rarely controversial during the 18th and 19th centuries, and
budget deficits were considered abnormalities to be tolerated only in extraordinary circumstances
such as war. Prolonged deficits in the aftermath of the Civil War and the depression of 1893 had
an impact on the way in which budgeting was done, but did not alter this objective. As late as the
1920s, adherence to this ideal meant congressional commitment to a policy of surpluses
throughout the decade to retire some of the huge debt accumulated due to the First World War.
The unprecedented magnitude of the deficits incurred during the Great Depression of the 1930s
and World War II seem a watershed in American fiscal history, but those deficits did not represent
a revolution in fiscal policy. Although the New Deal and the “new economics” ascribed to John
Maynard Keynes are intertwined in the minds of many, there was likely no direct and substantial
influence of Keynes on President Roosevelt’s fiscal policies.2 Indeed, Keynes’ General Theory of
Employment, Interest and Money
, the work that spurred the transformation of economic thought,
was not published until 1936. The Roosevelt Administration’s fiscal policy in the 1930s accepted

1 Letter from Thomas Jefferson to John Taylor, November 26, 1798. The Writings of Thomas Jefferson, vol. 10.
(Washington: The Thomas Jefferson Memorial Association, 1903), p. 63.
2 Herbert Stein, The Fiscal Revolution in America, rev. ed. (Washington: American Enterprise Press, 1990), p. 148.
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deficits as a consequence of “providing relief,” but not as part of a deliberate policy to bring
about recovery or full employment.3
The transformation of economic thought that followed Keynes had a growing impact on fiscal
policy after World War II, demonstrated by such legislation as the Employment Act of 1946.4
Even President Dwight Eisenhower, who was sometimes criticized for making a “fetish” of
balancing the budget,5 had some degree of flexibility on this question. He stated that, “it has
sometimes seemed a little bit odd that we have to make our whole ... economic cycle coincide
with the time it takes the earth to get around the sun.”6
By the time of the Kennedy Administration, the ideal of budget balancing had lost its primacy as
an influence on fiscal decisions. Advocates of Keynesian economic theories supported the
concepts of counter-cyclical spending and “full employment” budgeting. These concepts implied
increased government spending and tax cuts to offset downswings of the economy even if a
deficit resulted, and decreased spending, tax increases, or both in order to run surpluses during
upswings. This idea was based on the premise that governments should balance the economy, not
simply the budget. Although there is no generally accepted Keynesian orthodoxy, even among
economists,7 and there is much debate on the impact of government in the economy and on the
economics of budget balancing.
The Call for a Balanced Budget Amendment
The declining significance of balanced budgets as the singular goal of fiscal policy prompted
opposition efforts to establish formal legal underpinnings for the principle of a balanced budget.
Perhaps the first example of this occurred in 1935 when Senator Millard Tydings introduced the
first measure designed effectively to require the federal budget to be balanced (S.J.Res. 36, 74th
Congress). This resolution unsuccessfully sought to prohibit appropriations in excess of revenues
in the absence of new debt authorization, and require that any new debt be liquidated over a 15-
year period.
The following year Representative Harold Knutson introduced the first proposed constitutional
amendment that would have required a balanced budget (H.J.Res. 579, 74th Congress). That
proposal would have allowed for the possibility of deficits, but would have established a per
capita limitation on the federal public debt during peacetime. Since the limit suggested was lower
than the outstanding debt at the time, it would have effectively mandated budgetary surpluses.
The first congressional action beyond the introduction and referral of proposals occurred in 1947.
By special arrangement, the Senate Appropriations Committee had a balanced budget amendment
jointly referred to itself as well as the Senate Judiciary Committee. The Appropriations

3 Ibid., p. 60.
4 P.L. 304, 79th Congress, 60 Stat. 23.
5 U.S. President, 1953-1961 (Eisenhower). The President’s News Conference of February 18, 1959. Public Papers of
the Presidents of the United States, Dwight D. Eisenhower 1959
(Washington: GPO., 1960), p. 196.
6 Ibid., p. 197.
7 As early as 1966 economist Milton Friedman noted that “We are all Keynesians now and nobody is any longer a
Keynesian.” Quoted in Stein, Fiscal Revolution, p. 382, from Time (December 31, 1965, p. 65; and February 4, 1966, p.
13.).
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Committee reported the measure on May 5, 1947.8 However, the Judiciary Committee did not
take any subsequent action, and no further formal consideration occurred.
Since the 1930s, dozens of proposals have been made to require a balanced budget, to limit the
size or growth of the federal budget or of the public debt, or some combination of these ideas,
including several notable recent efforts. These have come in the form both of bills and proposed
constitutional amendments.
The Debate in Recent Decades
Possibly reinforced by previous experience that many Members of Congress have had at the state
level, where balanced operating budgets commonly are required, the issue has remained alive.9
For a period, some observers feared that the goal of a balanced budget, or even the Keynesian
ideal of using budget policy to balance the economy, had been totally abandoned. This was
particularly so in the 1990s because until FY1999, no President had proposed a budget in balance
since FY1971.10 Further, before FY1998, the federal government had not ended a fiscal year in
surplus since FY1969 (see Appendix A). During that period the size of annual deficits had
increased, both in terms of dollars and as a percentage of Gross Domestic Product (GDP). The
increasing level of both the federal deficit and debt (see Table 1) increased the popularity of the
idea of mandating a balanced budget.
In particular, it generated strong interest in the idea of using constitutional change as a remedy for
seemingly intractable current budgetary problems. Indeed, Presidents Ronald Reagan and George
H.W. Bush supported this position. President Bill Clinton also expressed support for a balanced
budget, although he opposed using a constitutional amendment to require one.
Popularity for a balanced budget amendment arguably waned during the late 1990s as the budget
came into balance. Between 1985 and 2002, other statutory budget controls were in effect as part
of the Balanced Budget and Emergency Deficit Control Act of 1985 and the Budget Enforcement
Act of 1990. Further, a combination of spending decreases, revenue increases, and a thriving
economy brought the budget into balance, and a surplus existed from FY1998 through FY2001.
Concern has recently spiked once again over an increasing deficit and its potential effect on the
nation’s fiscal and economic health. The budget deficit each year from 2009 to 2011 has been the
highest ever in dollar terms, and significantly higher as a share of GDP, than at any time since
World War II. Under current policies, the federal debt is projected to grow more quickly than
GDP, leading observers to term it unsustainable. While there has been no difficulty financing the

8 The report (S.Rept. 80-154) appears in the Congressional Record, vol. 93, May 6, 1947, at p. 4555.
9 Although most states require their operating budget to be balanced they typically allow for debt financing of capital
expenditures and various other exceptions to balanced budget requirements. For a examination of state balanced budget
practices see U.S. General Accounting Office, Balanced Budget Requirements: State Experiences and Implication for
the Federal Government
, AFMD-93-58BR, March 1993.
10 However, on several occasions Presidents have submitted proposed budgets that have included projections of
balanced budgets at some point further in the future. President Carter’s budget for FY1980 included projected balance
for FY1982, his budget for FY1981 projected balance for FY1982 and FY1983, and his budget for FY1982 projected
balance for FY1984. The amended FY1982 budget proposed by President Reagan also projected a balanced budget for
FY1984 and extended the projection to include balanced budgets in FY1985 and FY1986. President Clinton’s budget
for FY1998 included a projected balanced budget for FY2002.
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deficit to date, it has been argued that at some point, investors could refuse to continue to finance
deficits that they believe are unsustainable.11
According to some observers, the deficit problem is due to a budget process that permits the
government to run persistent substantial deficits and to a political system wherein deficit
spending may be rewarded. The fact that responsibility for deficits cannot be indisputably
assigned to any one action or actor, or even to either undertaxing or overspending alone, leaves
balancing the budget as a visible, but unrealized, priority. This has meant a surge of recent
support for measures guaranteeing a balanced budget, while deficits have grown to unprecedented
size.
Table 1. Federal Surplus/Deficit and Debt: FY1969-FY2010
(billions of current dollars)
Fiscal Year
Surplus(+)/Deficit(-)
Debt Subject to Statutory Limit
1969 +3.2 356.1
1970 -2.8 372.6
1971 -23.0 398.7
1972 -23.3 427.8
1973 -14.9 458.3
1974 -6.1 475.2
1975 -53.2 534.2
1976 -88.4 621.6
1977 -53.7 700.0
1978 -59.2 772.7
1979 -40.7 827.6
1980 -73.8 908.7
1981 -79.0 998.8
1982 -128.0 1,142.9
1983 -207.8 1,378.0
1984 -185.4 1,573.0
1985 -212.3 1,823.8
1986 -221.2 2,111.0
1987 -149.7 2,336.0
1988 -155.2 2,586.9
1989 -152.6 2,829.8
1990 -221.0 3,161.2
1991 -269.2 3,569.3

11 For more information, see CRS Report R41778, Reducing the Budget Deficit: Policy Issues, by Marc Labonte.
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Fiscal Year
Surplus(+)/Deficit(-)
Debt Subject to Statutory Limit
1992 -290.3 3,972.6
1993 -255.1 4,315.6
1994 -203.2 4,605.3
1995 -164.0 4,884.6
1996 -107.4 5,137.2
1997 -21.9 5,327.6
1998 +69.3 5,439.4
1999 +125.6 5,567.7
2000 +236.2 5,591.6
2001 +128.2 5,732.8
2002 -157.8 6,161.4
2003 -377.6 6,737.6
2004 -412.7 7,333.4
2005 -318.3 7,871.0
2006 -248.2 8,420.3
2007 -160.7 8,921.3
2008 -458.6 9,959.9
2009 -1,412.7
11,853.1
2010 -1,293
13,510.8
Source: Historical Tables: Budget of the United States Government F2012. Table 1.1—Summary of Receipts,
Outlays, and Surpluses or Deficits: 1789-2016, and Table 7.2—Debt Subject to Statutory Limit: 1940-2015.
a. Figures combine the amounts for FY1976 and the Transition Quarter that occurred when the start of the
fiscal year was shifted from July 1 to October 1.
Despite fiscal and budgetary policies that doubled the national debt in the first five years of his
Administration, President Ronald Reagan was an outspoken advocate of the ideal of a balanced
budget. Even before the beginning of his tenure as President, during his 1980 campaign, he wrote
“Excessive Federal spending and deficits have become so engrained in government today that a
constitutional amendment is necessary to limit spending.”12
In his first inaugural address, Mr. Reagan spoke against public spending that had “piled deficit
upon deficit,” and had “mortgag[ed] our future and our children’s future for the temporary
convenience of the present.”13 Later, during his second term, he spoke of an “economic bill of
rights” with a balanced budget amendment as its centerpiece, and suggested that it was long
overdue.14

12 Quoted in U.S. Congress, Senate Committee on the Judiciary, Balanced Budget Constitutional Amendment. Report
on S.J.Res. 225,
S.Rprt. 99-163, 99th Cong., 1st sess. (Washington: GPO., 1985), p. 3.
13 U.S. President, 1981-1989 (Reagan), Inaugural Address, January 20, 1981, Public Papers of the Presidents of the
United States, Ronald Reagan 1981
(Washington: GPO., 1982), p. 2.
14 U.S. President, 1981-1989 (Reagan), “Remarks Announcing America’s Economic Bill of Rights,” July 3, 1987.
(continued...)
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In his first budget submission (FY1991) President George Bush reiterated these themes, stating
that a balanced budget amendment should be adopted to “halt the steady build-up of national
debt,” in order to “protect the interest of future generations.”15
President Clinton’s approach was more guarded: supportive of the idea of a balanced budget, but
generally opposed to a constitutional requirement. In a 1993 letter to congressional leaders,
Clinton characterized the proposed constitutional amendment approach as a “budget gimmick”
whose vagueness would result in “appointed judges with life tenure” making budget decisions
that he felt should be made by elected lawmakers.16 On March 16, 1994, President Clinton sent a
letter to Congress in which he stated his opposition to a constitutional amendment, despite his
overall support for deficit reduction.17 This opposition was more subdued in his 1995 State of the
Union Address, when he reiterated his support for deficit reduction.18 In his 1997 State of the
Union Address, however, President Clinton made his opposition to a constitutional amendment
plain. Balancing the budget, he stated, did not require rewriting the Constitution. He further stated
that “I believe it is unnecessary and unwise to adopt a balanced budget amendment that could
cripple our country in time of crisis later on and force unwanted results such as judges halting
Social Security checks or increasing taxes.”19
During the 1994 congressional election campaign the Republican Party (as well as a number of
Democratic candidates) continued to champion the cause of a balanced budget constitutional
amendment. Included in the “Contract With America” signed by many Republican House
candidates in 1994, and a central part of the agenda for the Republican majority elected to both
Houses that year, was support for a balanced budget amendment. The version included in the
“Contract With America” also incorporated a provision to require a three-fifths vote of both
houses of Congress to increase revenues.
Viewing the prospect that Congress might adopt a balanced budget amendment, the Governors of
a number of states urged caution in embracing specific amendment language, further
complicating the debate. Many of those attending the 1994 Republican Governors’ Conference,
while supporting the concept of a balanced budget amendment, expressed concern that it could
increase the financial burden of the states by encouraging Congress to pass laws imposing
mandates and requirements without providing funding to carry them out.20 The chairman of the
National Governors’ Association, Howard Dean characterized the proposal for a balanced budget
amendment a “political show,” and said that no state legislature “in its right mind” would approve
an amendment that didn’t also include safeguards against unfunded mandates.21

(...continued)
Public Papers of the Presidents of the United States, Ronald Reagan 1987, v. I (Washington: GPO., 1987), p. 739.
15 Budget of the United States Government, FY1991 (Washington: GPO., 1990), p. 268.
16 U.S. President, 1993- (Clinton), Letter to Congressional Leaders on the Proposed Balanced Budget Amendment,
November 5, 1993, Public Papers of the Presidents of the United States, William J. Clinton, 1993, vol. II (Washington:
GPO., 1994), p. 1916.
17 H.Doc. 103-223, March 17, 1994.
18 Congressional Record, daily edition, vol. 141( January 24, 1995), p. H586.
19 “Text of President Clinton’s State of the Union Message to Congress,” New York Times, February 5, 1997, p. A20.
20 Taylor, Andrew, “Governors: Don't Balance Budget Without Ending Mandates,” CQ Weekly Report, November 26,
1994, p. 3403.
21 “Budget Proposal Called ‘Political Show,’” Washington Post, December 9, 1994, p. A18.
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While lawmakers continued to introduce legislation proposing a balanced budget amendment,
popularity waned until relatively recently. Just six months into the 112th Congress, more proposals
have been introduced for a balanced budget amendment than in any Congress since the 105th. The
House Judiciary Committee considered and reported H.J.Res. 1 (112th) on June 23, 2011. All 47
Senate Republicans have said they favor a balanced budget amendment.22 Further, a Balanced
Budget Amendment Caucus was founded last year by a bipartisan group of Members of Congress
with a membership of over 60 Members.
On the other hand, there has also been recent objection to the idea of a balanced budget
amendment. When asked in a press briefing about President Obama’s support for a balanced
budget amendment, Press Secretary Jay Carney stated,
What we don’t think is necessary is to amend the Constitution or to pass a across-the-board
spending reduction measure that will, for example, in both cases, seriously under-fund
Medicare and Social Security, and does the exact opposite in many ways of what the
President has said is necessary, which is take a balanced approach to our long-term deficit
and debt problems.23
Prominent former lawmakers from both political parties who were present during the last
significant push for a balanced budget amendment, have recently voiced objection to the idea of a
balanced budget amendment, particularly if its passage is coupled with legislation to increase the
federal debt limit as a way to make the debt limit increase more tolerable. Former GOP
appropriator and Senate Budget Chairman, Judd Gregg stated,
Conservatives should not tolerate those who would condition their willingness to make the
tough, important votes that will address our fiscal chaos on unrealistic and impractical ideas
that will have no impact on the problem. They will not come to pass in time to stop the
government from spending us into oblivion. It is not uncommon for representatives and
senators to propose amendments to controversial legislation that have no viability. This tactic
gives them the excuse to avoid the difficult votes that might actually have an impact on a
critical issue. This approach is the political equivalent of “hiding in the corners.” The debt
ceiling is an opportunity for real action. It can be used to force immediate action to adjust the
nation’s present course, which is headed towards fiscal disaster.24
Former Democratic Senate Majority Leader Tom Daschle stated,
I was once a supporter of a constitutional balanced budget amendment that was proposed by
my friend and former colleague Sen. Paul Simon in the early 1990s. We both believed that
the gravity of a constitutional requirement coupled with lawmakers’ sworn fidelity to the
Constitution would be powerful enough to successfully overcome this political inertia. It
won't. The answer will not come with just the constitutional requirement. It comes from
members of Congress who are willing to work together to find real solutions, make difficult
choices and achieve real results. It has been done before and can be done again. It was not
easy to reduce spending or to raise taxes, but we did it. We made the unpopular choices in
1990, 1993 and 1997.We did not try to dodge the bullet. We bit the bullet, multiple times.

22 Senator Mitch McConnell stated, “Our view is a good first step is a balanced budget amendment to the Constitution.
All 47 Republicans are in favor of that,” quoted in “GOP Conference on Balanced Budget,” CQ TranscriptsWire, June
29, 2011, http://transcriptswire.cq.com/do/transcriptView?id=15591524.
23 The White House, “Press Briefing by Press Secretary Jay Carney,” press release, April 26, 2011,
http://www.whitehouse.gov/the-press-office/2011/04/26/press-briefing-press-secretary-jay-carney-4262011.
24 Judd Gregg, “Don’t use amendment to dodge debt-ceiling action,” The Hill, June 13, 2011.
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We made steady progress reducing the deficit beginning in 1990 and ultimately turned it into
a budget surplus from 1998 through 2001. We did it without undermining the sanctity of our
Constitution or degrading it to push an ideological agenda.25
A balanced budget has become a central objective of many recent efforts to reform the way the
federal government operates, and is mentioned as a possible benefit in others. Achieving this goal
is far from a simple matter however. Despite significant support for the concept of a balanced
budget amendment, the failure to achieve a two-thirds vote of approval in both houses of
Congress has been a reflection of the complexity of the issue, as well as unsettled questions
concerning potential difficulties involved in implementing it. Historically, public opinion studies
have routinely shown broad support for a balanced budget.26 These same polls have also indicated
that a majority of those interviewed generally favors spending increases in most policy areas and
reductions in taxes. These incompatible public attitudes convey to the President and Congress
contradictory policy mandates.27 Such inconsistencies augment the quandary reflected by more
than 50 years of congressional consideration of a balanced budget amendment.
There have often been two almost separate debates occurring simultaneously on the subject of a
balanced budget requirement: whether there should be a balanced budget and whether there
should be a constitutional amendment. The pros and cons of a balanced budget may be related to
the pros and cons of a constitutional requirement, but they are not identical.
II. The Constitutional Amendment Approach
Probably the most popular method advocated for ensuring that the federal budget is balanced has
been a constitutional amendment. Although it would require a two-thirds vote of approval in both
houses of Congress as well as ratification by three-fourths of the states before it could become
effective, most of the debate has focused on the constitutional amendment approach.
Arguments of Proponents
Arguments for and against a balanced budget amendment include economic, symbolic, and
political appeals. Those advanced most prominently by proponents have focused on three things:
• the morality of balanced budgets, and the impact of current deficits on future
generations of taxpayers;
• the economic benefits of reducing the deficit, particularly in the form of lower
interest rates, enhanced savings rates and overall economic growth; and

25 Tom Daschle, “The Trouble With the Balanced Budget Amendment,” The Wall Street Journal, June 4, 2011.
26 For example, in its 1982 study on balancing the federal budget, CBO reported that for half a century polling
organizations have found that a large majority of Americans consistently had supported the idea of a balanced federal
budget. See U.S. Congressional Budget Office, Balancing the Federal Budget and Limiting Federal Spending:
Constitutional and Statutory Approaches
(Washington: GPO., 1982), p. 28. (Hereafter cited as CBO, Balancing the
Federal Budget.
) Other studies show similar results. See Andre Modigliani and F. Modigliani. “The Growth of the
Federal Deficit and the Role of Public Attitudes,” Public Opinion Quarterly, vol. 51, fall 1987.
27 For a discussion of this phenomenon, see Andre Modigliani and F. Modigliani, “The Growth of the Federal Deficit
and the Role of Public Attitudes.”
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• the expectation of improved public attitudes towards political institutions and
politicians if balanced budgets are achieved.
Proponents of a constitutional amendment also cite the failure of past statutory attempts to
compel a balanced budget. In their view, a constitutional amendment would be more binding by
its nature and thus act as a surer means of achieving the desired result. A constitutional
amendment, unlike a statute or rule, could only be superseded by another constitutional
amendment. Without this discipline, proponents believe, the goal of a balanced budget would not
be attained because of the conflicting pressure to spend.
Most proposed amendments have assumed that enforcement mechanisms could be separately
enacted as statutes, but that a constitutional provision would be primarily self-enforcing. For
example, in a 1985 report accompanying a proposed amendment, the Senate Judiciary Committee
stated that
The Committee expects the Congress and the President to carry out their responsibilities
under the proposed amendment through both (a) the authority presently available to
Congress and the President to affect and influence the fiscal process; and (b) any new
authority created by Congress under its Article I enforcement authority, and otherwise
consistent with the Constitution by which the Congress and the President can affect and
influence the fiscal process.28
In 1993, the Senate Judiciary Committee stated that
Flagrant disregard of the proposed amendment’s clear and simple provisions would
constitute nothing less than a betrayal of the public trust. In their campaigns for reelection,
elected officials who flout their responsibilities under this amendment will find that the
political process will provide the ultimate enforcement mechanism.29
The question of judicial involvement has been a persistent concern of opponents, but advocates of
a balanced budget amendment reject the argument that a constitutional amendment would
provoke rampant judicial interference with federal budgeting. First, they suggest that most parties
would lack the standing to bring suit, and thus the number of suits would be limited.30 Second,
they cite the political question doctrine enunciated in Baker v. Carr,31 and suggest that this would
place most cases outside the realm of judicial review. And third, that most issues arising under an
amendment would not be justiciable because they would not present a case or controversy as
mandated under Article III.32 Some have also proposed that the judiciary could be limited by

28 Senate Judiciary Committee, Report on S.J.Res. 225, p. 57.
29 U.S. Congress. Senate Committee on the Judiciary. Balanced Budget Constitutional Amendment. Report to
Accompany S.J.Res. 41,
S.Rept. 103-163, 103rd Cong., 1st sess. (Washington: GPO., 1993), p. 6.
30 For example, the Supreme Court has denied standing to persons seeking enforcement of constitutional provisions
whose claims rested on the premise that all persons suffer a common injury from a violation or nonenforcement of a
constitutional command (e.g., Schlesinger v. Reservists Committee, 418 U.S. 208 (1974) or United States v.
Richardson, 418 U.S. 166 (1974)).
31 369 U.S. 186 (1962). As described in United States v. Munoz-Flores, 495 U.S. 385 (1990), “the political question
doctrine is designed to restrain the judiciary from inappropriate interference in the business of the other branches of
government.” For a discussion of this doctrine, see Senate Judiciary Committee, Report on S.J.Res. 225, 99th Cong., 1st
sess., p. 56.
32 For example, the Supreme Court has ruled that any alleged personal stake or injury must be direct and specific, not
general. “A plaintiff must allege some particularized injury that sets him apart from the man on the street.” United
States
v. Richardson 369 U.S. 186, 204 (1962).
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including specific language in an amendment that would explicitly define their role (see section
on judicial review in chapter VI of this report).
Arguments of Opponents
The constitutional amendment approach is not, however, without controversy. Practical
difficulties in enforcement, and the potential for judicial involvement have been among the most
salient arguments of opponents.
Concern over possible judicial involvement with the power of the purse is as old as the
Constitution. Alexander Hamilton in The Federalist (number 78) reassured his readers that the
judiciary was designed to have “no influence over either the sword or the purse.”33 During
previous congressional consideration of balanced budget amendments, questions of standing and
judicial authority have been raised and debated, but no conclusive answers have been reached.
Despite any expectation of self-enforcement, opponents argue that such an amendment would
inevitably lead to involvement by federal judges, and ultimately by the Supreme Court, in the
budget making process. Indeed, this possibility was what caused Robert Bork, then a federal
judge and formerly Solicitor General during the Nixon Administration, to write,
The results of such an amendment would be hundreds, if not thousands, of lawsuits around
the country, many of them on inconsistent theories and providing inconsistent results. By the
time the Supreme Court straightened the whole matter out the budget in question would be at
least four years out of date and lawsuits involving the next three fiscal years would be
climbing toward the Supreme Court.34
Additionally, Senator George Mitchell stated during the debate on S.J.Res. 58 in 1982:
Although its sponsors have expressed faith that the courts would not intervene in the budget-
writing operations of the Congress, it is difficult to find any justification for that faith. ... I
believe that it is impossible for anyone to predict, with any degree of certainty, what the
courts may do at some future time.35
Opponents respond to assertions that judicial involvement would be minimal by suggesting that
standing to bring suit may well exist in numerous circumstances.36 The Supreme Court has
previously expressed a standard for determining standing in terms of whether the litigant has
alleged injury-in-fact, that is “distinct and palpable” and not abstract, conjectural, or hypothetical,
or personal injury that is “fairly traceable to the ... allegedly unlawful conduct ... likely to be
redressed by the requested relief.”37 Even an inability to show standing, however, would not
necessarily limit the number of suits. Numerous suits could be brought (to gain publicity, for
instance) without regard to their merit.

33 Alexander Hamilton, James Madison, and John Jay, The Federalist Papers (New York: Mentor Books, 1961), p.
465.
34 Cited in Senate Judiciary Committee, Report on S.J.Res. 225, 99th Congress, 1st sess., p. 98.
35 See remarks of Senator Mitchell in the Congressional Record, vol. 128, August 4, 1982, p. 19217.
36 For a broader discussion of questions of justiciability, see Gay Aynesworth Crosthwait, “Article III Problems in
Enforcing the Balanced Budget Amendment.” Columbia Law Review, vol. 83, no. 5. June, 1983. p. 1065.
37 Allen v. Wright, 468 U.S. 737 (1984).
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The question of what would be precluded from judicial review is not something that can be
predicted with certainty. For example, the Origination Clause of the Constitution, which mandates
that all bills for raising revenue shall originate in the House of Representatives, has traditionally
been regarded as a matter entirely internal to Congress, and left for the House to decide as a
matter of its prerogatives. However, in United States v. Munoz-Flores,38 the Supreme Court
rejected a claim that a case based on the Origination Clause was nonjusticiable. This, and other
recent cases, would seem to narrow the bounds of what is nonjusticiable.
The experience of state governments indicates that concern over judicial involvement in
budgeting is realistic. In some states the judiciary has become involved with the operation of
various aspects of budgeting to impose budget balancing remedies (e.g., requiring tax increases,
limiting expenditures generally or preventing implementation of specific spending laws). The
possibility that federal courts could invoke such remedies prompts concern about the potential
such actions would have for causing a significant shift in the balance of power among the
branches of the federal government.39
Opponents also counter the arguments of the amendment’s advocates that such a requirement
would result in benefit to the economy generally. Although most opponents do not argue that a
smaller deficit would be inherently harmful to the economy, they do argue that mandating a
balanced budget can produce harmful results. Specifically, they suggest that a balanced budget
amendment would require Congress to counteract the budget’s automatic countercyclical
stabilizers in the event of a recession. That is, such a requirement would force the government to
raise taxes or cut spending (or both) at a time when it would be most likely to have a negative
impact on the economy.
Concerns an Amendment Would Need To Address
A number of difficult questions would be posed if a balanced budget amendment were adopted.
These difficulties do not necessarily establish any inherent barrier to a constitutional amendment,
but they do raise concerns about how an amendment would operate in practice. One of the chief
concerns, and one that would affect a statutory approach as well, is the question of predictability.
According to former Senator Howard Metzenbaum,
... there is a high degree of inherent uncertainty in spending and revenue projections. It is
impossible to guarantee congressional budget decisions at the beginning of a fiscal year will
lead to a balanced budget at the end of the year.40
Although some proposed amendments do not explicitly require a fiscal year to end in balance,
most would measure compliance against a standard of actual outlays or receipts. Because of the
sensitivity of both tax receipts and many expenditures to economic conditions, achievement of a

38 495 U.S. 385 (1990).
39 For a detailed discussion of State experience with balanced budget requirements, see Henning Bohn and Robert P.
Inman, “Balanced Budget Rules and Public Deficits: Evidence From the U.S. States,” National Bureau of Economic
Research Working Papers
no. 5533 (Cambridge, MA: National Bureau of Economic Research, 1996); Richard
Briffault. Balancing Acts: The Reality Behind State Balanced Budget Requirements (Washington: Twentieth Century
Fund Press, 1997); and Stewart E. Sterk and Elizabeth Goldman, “Controlling Legislative Shortsightedness: The
Effectiveness of Constitutional Debt Limitations,” Wisconsin Law Review, vol. 1991, no. 6. p. 1301.
40 Senate Judiciary Committee, Report on S.J.Res. 225, 99th Cong., 1st sess. p. 96.
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balanced budget would be dependent upon the accuracy of predictions for performance of the
economy in a given year, and not solely on congressional good faith efforts to enact budgetary
legislation that would result in projected compliance.
It could also be difficult to prevent policy choices at the federal level to could have the effect of
circumventing or systematically evading a balanced budget requirement. The Congressional
Budget Office has suggested that this would be a real possibility, or even a probability, if the
advocates of the need for a constitutional amendment are correct about a bias toward increasing
federal spending.41 Several types of actions might in effect avoid the restraints imposed by a
balanced budget amendment:
increased use of regulatory, rather than budgetary, action. In applicable areas this would
impose costs on state or local governments or the private sector.
increased use of loan guarantees. As contingent liabilities they would not necessarily be
included in the budget. Current budget rules require only the projected subsidy cost of
such guarantees to be recorded as a budget item.
increased scope for activities by Government-Sponsored Enterprises (GSEs) or other
non-governmental agents. Because a balanced budget amendment would apply only to
the government, debt issued or activities undertaken by such entities would be exempt
from its requirements.
An additional concern raised by people in several state governments is that a federal balanced
budget requirement would cause additional burdens to fall on state governments. Congress
attempted to answer this in 1995 through the Unfunded Mandates Reform Act.42 This act
generally limits the ability of the federal government to consider legislation that would impose
mandates on state or local officials without providing the funds to implement them. Congress
may, however, waive this prohibition. There is also some concern that if a federal balanced
budget requirement caused significant cuts in federal programs, that at least some states would
find it necessary to make compensatory increases in their own spending, regardless of whether
such expenditures were mandated by the federal government.
These problems are not beyond remedy or substantial mitigation, but experience in the states, as
well as in the federal government, suggest that they are fundamental and bear careful attention.
III. Congressional Consideration of Proposed
Constitutional Amendments

For more than six decades, Congress has shown an interest in a balanced budget requirement.
Because balanced budget proposals are often in the form of proposed constitutional amendments,
which are under the jurisdiction of the House and Senate Judiciary Committees, these committees
have been in the forefront of the debate. As indicated in Table 2 and Table 3 below, the Senate
Committee on the Judiciary has conducted hearings on balanced budget amendments on at least

41 CBO, Balancing the Federal Budget, p. 23, 103.
42 P.L. 104-4, 109 Stat. 50, incorporated into the Congressional Budget Act at sections 421-428.
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23 days extending back to the 84th Congress. It also reported nine joint resolutions between the
97th and 105th Congresses.43 The House has held hearings less often, but its Members have
considered balanced budget constitutional amendments on seven separate occasions: in the 97th,
101st, 102nd, 103rd, 104th, 105th and 112th Congresses. This section summarizes congressional
hearings and floor action in consideration of balanced budget amendments.44
Table 2. Senate Judiciary Committee Hearings On Balanced Budget Amendments
Publication
Congress Measure(s)
Date
Number
84th
S.J.Res. 126, 133
June 14, 1956
printed (no doc.
number)
94th
S.J.Res. 55, 93
September 23, Oct. 7, 1975
printed (no doc.
number)
96th
S.J.Res. 2, 4, 5, 6, 7, 9, 10, 11, 13, March 12, May 23, July 25, Oct. 4, 11,
96-41
16,18, 36, 38, 45, 46, 56, 76, 79,
November 1, 1979
86, 93
S.J.Res. 126
January 14,a Feb. 22,b 1980 96-67
97th
S.J.Res. 9, 43, 58
March 11, April 9, May 20, 1981
J-97-45
S.J.Res. 58
May 29,c 1981
J-97-12
98th
S.J.Res. 5
December 12, 1983,d
J-98-88
March 6, 1984
(S.Hrg. 98-1084)
99th
S.J.Res. 13
May 7, 1985
J-99-22
(S.Hrg. 99-241)
100th
S.J.Res. 3, 4, 8, 11, 25, 50, 112,
March 23, 1988
J-100-59
161
(S.Hrg. 100-1076)
101st
S.J.Res. 2, 9, 12, 183
July 27, 1989
J-101-36
(S.Hrg. 101-1009)
103rd
S.J.Res. 41
March 16, 1993
J-103-4
(S.Hrg. 103-384)

43 The only previous proposed balanced budget amendment to be reported from a Committee was in 1947. A proposal
introduced by Senators Millard Tydings (D-MD) and Styles Bridges (R-NH) was referred to the Senate Appropriations
Committee by special arrangement. The Committee reported the proposal back to the Senate, but it was subsequently
referred to the Senate Judiciary Committee and no further action was taken. (S.J.Res. 61, S.Rept. 154, 80th Congress;
see Congressional Record v. 93, May 6, 1947. p. 4555-4557.)
44 Detailed compilations of congressional committee hearings and floor actions for the 100th-103d Congresses have
been prepared by the Senate Budget Committee. U.S. Congress. Senate. Committee on the Budget. Proposed
Constitutional Amendments to Balance the Federal Budget: Floor Action and Committee Hearings for the 100th
Congress
. Committee Print S.Prt. 103-95, 103rd Cong., 2nd Sess. (Washington: U.S. Govt. Print. Off., 1994); U.S.
Congress. Senate. Committee on the Budget. Proposed Constitutional Amendments to Balance the Federal Budget:
Floor Action and Committee Hearings for the 101st Congress
. Committee Print S.Prt. 103-94, 103rd Cong., 2nd Sess.
(Washington: U.S. Govt. Print. Off., 1994); U.S. Congress. Senate. Committee on the Budget. Proposed Constitutional
Amendments to Balance the Federal Budget: Floor Action and Committee Hearings for the 102d Congress
. Committee
Print S.Prt. 103-92, 103rd Cong., 2nd Sess. (Washington: U.S. Govt. Print. Off., 1994); U.S. Congress. Senate.
Committee on the Budget. Proposed Constitutional Amendments to Balance the Federal Budget: Floor Action and
Committee Hearings for the 103d Congress
. Committee Print S.Prt. 103-112, 103rd Cong., 2nd Sess. (Washington: U.S.
Govt. Print. Off., 1994).
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Publication
Congress Measure(s)
Date
Number
S.J.Res. 41
February 15, 16, 17, 1994
J-103-41
(S.Hrg. 103-996)
104th
S.J.Res. 1
January 5, 1995e J-104-1
(S.Hrg. 104-506)
105th
S.J.Res. 1
January 17, 22, 1997e J-105-1
(S.Hrg. 105-115)
Source: U.S. Senate. Committee on the Judiciary. Legislative and Executive Calendar, Final Edition, 80th-104th
Congress. For the 104th Congress: U.S. Senate. Balanced Budget Constitutional Amendment. Report to Accompany
S.J.Res. 1. S.Rpt. 104-5, 104th Cong., 1st Sess. (Washington: U.S. Govt. Print. Off., 1995); for the 105th Congress:
Congressional Record (daily edition). All hearings listed conducted by the Subcommittee on the Constitution or its
predecessor Subcommittee on Constitutional Amendments unless otherwise noted.
a. Field hearings conducted by the full committee in Mobile, AL.
b. Field hearings conducted by the full committee in Salt Lake City, UT.
c. Field hearings conducted in Phoenix, AZ.
d. Field hearings conducted in Los Angeles, CA.
e. Hearings conducted by the full committee.
Hearings on a Balanced Budget Amendment
In addition to the hearings held by the Senate Judiciary Committee listed in Table 2, there have
been hearings conducted by several other committees, including
House Judiciary Committee—October 15, November 17, and 18, 1987 (serial
no. 85), July 10 and 11, 1990 (serial no. 143), January 9 and 10, 1995 (serial no.
5), and February 3, 1997 (serial no. 1); March 6, 2003 (serial no.1); May 13,
2011 (not yet printed);
House Budget Committee—April 28, May 6, 11, 12, 13, and 19, and June 3,
1992 (serial nos. 102-42 and 102-43), and February 5, 1997 (not printed);
Senate Budget Committee—June 4 and 10, 1992 (S.Hrg. 102-693);
Senate Appropriations Committee—February 15, 16, 17, and 18, 1994 (S.Hrg.
103-423);
Joint Economic Committee—September 11, 1984 (S.Hrg. 98-1260), January 20
and 23, and February 16, 1995 (S.Hrg. 104-74, parts 1, 2, and 3 respectively).
Besides the hearings conducted by these committees on balanced budget proposals, a number of
other hearings on budget process reform generally have touched upon balanced budget initiatives.
Floor Consideration of Amendment Proposals
Between 1981 and 1997, the Senate Judiciary Committee has approved nine balanced budget
proposals and reported them to the full Senate (see Table 3). Five of these measures were
considered on the Senate floor, one in each of the 97th, 99th, 103rd, 104th, and 105th Congresses.
Additionally, in the House proposed constitutional amendments to require a balanced federal
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budget have advanced to floor consideration without committee support on four occasions, in the
97th, 101st, 102nd, and 103rd Congresses. The House Judiciary Committee also reported a proposed
amendment that was considered on the floor in the 104th Congress. The first floor consideration
was in 1982 when both the Senate and House debated such measures. The House Judiciary
recently reported a proposed amendment on January 23, 2011 which has not yet been considered
on the House floor.
Table 3. Joint Resolutions Proposing Balanced Budget Amendments Reported by the
Senate Judiciary Committee
Congress Measure(s) Date
Report
No.
97th
S.J.Res. 58
July 10, 1981
S.Rpt. 97-151
98th
S.J.Res. 5
September 20, 1984
S.Rpt. 98-628
99th
S.J.Res. 13
October 23, 1985
S.Rpt. 99-162
S.J.Res. 225
October 23, 1985
S.Rpt. 99-163
101st
S.J.Res. 183
July 25, 1990
S.Rpt. 101-391
102nd
S.J.Res. 18
July 9, 1991
S.Rpt. 102-103
103rd
S.J.Res. 41
October 21. 1993
S.Rpt. 103-163
104th
S.J.Res. 1
January 24, 1995
S.Rpt. 104-5
105th
S.J.Res. 1
February 3, 1997
S.Rpt. 105-3
Source: For 97th-103rd Congresses: U.S. Senate. Committee on the Judiciary. Legislative and Executive Calendar,
Final Edition, 97th-103rd Congress. For 104th Congress: U.S. Senate. Balanced Budget Constitutional Amendment.
Report to Accompany S.J.Res. 1. S.Rpt. 104-5, 104th Cong., 1st Sess. (Washington: U.S. Govt. Print. Off., 1995). For
105th Congress: U.S. Senate. Balanced Budget Constitutional Amendment. Report to Accompany S.J.Res. 1. S.Rept. 105-
3, 105th Cong., 1st Sess. (Washington: U.S. Govt. Print. Off., 1997).
97th Congress
In the Senate, consideration of S.J.Res. 58 during the 97th Congress produced the first approval of
such a measure when the Senate adopted the resolution 69-31 on August 4, 1982, following 11
days of floor deliberation.45 Later that year, following a successful discharge petition effort led by
Representatives Barber Conable and Ed Jenkins, the House considered a similar proposal.
H.J.Res. 350 was considered under the terms of a king-of-the-hill rule46 (H.Res. 604) on Oct. 1,
1982. A substitute offered by Representative Bill Alexander that would have required the
President to submit a balanced budget, and for Congress to adopt a statement of receipts and
outlays in which “total outlays are no greater than total receipts”, but not require the year to end
with the budget actually balanced was defeated 77-34647 prior to the vote on final passage.

45 Senate consideration occurred on July 12, 13, 19, 26, 27, 28, 29, and 30 and August 2, 3, and 4, 1982. For the final
vote see vote no. 288 in the Congressional Record, vol. 128, August 4, 1982, p. 19229.
46 A king-of-the-hill rule is a variety of special rule which provides for the consideration of a series of alternatives
regardless of the vote on any preceding alternative. Each alternative is considered in a specified order and the last
alternative agreed to is the one that is deemed finally agreed to.
47 See vote no. 386 in the Congressional Record, daily edition, vol. 128 (October 1, 1982), p. H8336.
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Although the measure was approved by a majority, the vote provided less than the necessary two-
thirds, and the effort for a balanced budget amendment failed, 236-187.48
99th Congress
During the 99th Congress, the Senate Judiciary Committee reported two proposed balanced
budget amendments for consideration on the floor. One of these measures, S.J.Res. 13, also
included tax limitation provisions. It was placed on the Senate Legislative Calendar under
General Orders, but it did not receive further consideration. The second proposal, S.J.Res. 225,
was debated extensively over eight days. On March 25, 1986, the Senate rejected S.J.Res. 225,
failing to achieve the necessary two-thirds majority by a single vote, 66-34.49
101st Congress
In 1990, again following a successful discharge effort, this time led by Representative Charles
Stenholm, the House considered a balanced budget amendment. Like its predecessor, H.J.Res.
268 was considered under the terms of a king-of-the-hill rule (H.Res. 434) on July 17, 1990. A
substitute with a tax growth limitation provision offered by Representative Joe Barton was
rejected 184-244,50 but a modified version of the measure offered by Representative Charles
Stenholm was adopted as a substitute, 276-152,51 before the vote on final passage. However, the
measure failed to achieve the necessary two-thirds majority, 279-150,52 and was defeated.
102nd Congress
Two House proposals in the 102nd Congress calling for a balanced budget constitutional
amendment gathered over 100 cosponsors (H.J.Res. 290 introduced by Representative Charles
Stenholm, and H.J.Res. 248 introduced by Representative Joe Barton). In response to the
increased possibility that the House would consider a balanced budget measure, the House
Budget Committee began a series of six days of hearings on the subject of a balanced budget on
April 29, 1992. The hearings continued on May 6, 11, 12, 13, and 19. On May 20, 1992 a petition
was filed to discharge the Rules Committee from further consideration of H.Res. 450, a special
rule to extract H.J.Res. 290 from further consideration by the House Judiciary Committee and
provide for its consideration by the House. The petition received the requisite 218 signatures the
same day and was entered on the Discharge Calendar. A unanimous consent agreement was
reached on June 4, 1992, to allow the resolution to be called up for consideration on June 10,
under the same terms as if discharged, but modifying its provisions to increase general debate
time on the proposed amendment to nine hours.
After agreeing to H.Res. 450, debate on the proposed amendment was begun on June 10. On June
11, the House considered a series of substitutes under a king-of-the-hill procedure. A substitute
version offered by Representative Jon Kyl included provisions to limit expenditures to 19% of

48 See vote no. 387, ibid., p. H8337.
49 Senate consideration occurred on March 6, 7, 10, 11, 12, 13, 18, and 25, 1986. For the final vote see vote no. 45 in
the Congressional Record, daily edition, vol. 132 (March 25, 1986), p. S3345.
50 See vote no. 236 in the Congressional Record, daily edition, vol. 136 (July 17, 1990), p. H4859.
51 See vote no. 237, ibid., p. H4869.
52 See vote no. 238, ibid., p. H4870.
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GNP and to grant item veto authority to the President, but was defeated, 170-258.53 A second
substitute, offered by Representative Joe Barton, consisted of the text of H.J.Res. 248 and
included a provision to limit the rate of growth of federal taxes to the rate of growth of national
income. It was defeated, 200-227.54 The third substitute, offered by Representative Richard
Gephardt, consisted of the text of H.J.Res. 496 and included a provision to exempt the Social
Security trust fund from the provisions of the amendment. It was defeated, 103-327.55 The final
substitute was offered by Representative Charles Stenholm as a minor modification of the original
text of H.J.Res. 290. It was agreed to 279-153;56 however, the measure then failed to achieve the
necessary two-thirds majority for final passage, 280-153,57 and was defeated.
Senate consideration in the 102nd Congress was complex, but likewise did not result in passage of
a balanced budget constitutional amendment. The Judiciary Committee reported a measure
(S.J.Res. 18) on July 9, 1991, with an amendment (S.Rept. 102-103). This proposal gained
heightened significance when the Senate adopted an amendment to the FY1993 Budget
Resolution (H.Con.Res. 287) proposed by Senator Don Nickles on April 9, 1992. The Nickles
amendment expressed the sense of the Senate that it should adopt a balanced budget amendment
on or before June 5. The Senate agreed to an amendment to the Nickles amendment, offered by
Senator Robert Byrd, which added that a balanced budget amendment should included a
requirement that the President submit a balanced budget. On May 21, 1992, the House and Senate
reached final agreement on H.Con.Res. 287. The resolution retained a modified version of the
Nickles amendment in Section 14, expressing the sense of the Senate that it should vote by July 2
on a balanced budget amendment that included a requirement that the President submit a balanced
budget, but that any amendment should be drafted or amended so as not to exacerbate any
economic recession. In addition, the Senate Budget Committee held hearings on the subject of a
balanced budget amendment on June 4 and 10, 1992.
After the House rejected H.J.Res. 290, Senator Paul Simon, the chief sponsor of S.J.Res. 18,
announced that he would defer attempting to bring the proposed amendment to the floor of the
Senate until the 103rd Congress. However, a group of Senators, led by Senators Phil Gramm, Don
Nickles, and John Seymour, endeavored to keep the issue on the agenda in the Senate. On June
24, 1992, Senator Seymour (for Senator Nickles) offered an amendment to an unrelated bill (S.
2733, concerning regulation of Government Sponsored Enterprises) that would strike that
measure’s language and substitute the text of a balanced budget constitutional amendment. An
amendment offered by Senator Robert Kasten that would have added a tax limitation provision
was rejected, 33-63, on June 30.58 Senator Robert Byrd offered an amendment to replace the
constitutional requirement in the Seymour amendment with a statutory requirement that the
President submit a balanced budget proposal by September 2. This amendment, as amended by a
second degree amendment also offered by Senator Byrd, was rejected on June 30, 39-57.59 After
declining to amend the language of the proposed constitutional amendment, however, supporters
failed by the same 56-39 margin on both June 30 and July 1 to gather the 60 votes necessary to
invoke cloture in the face of a threatened filibuster, and the amendment was withdrawn on July 1.

53 See vote no. 183 in the Congressional Record, daily edition, vol. 138 (June 11, 1992), p. H4605.
54 See vote no. 184, ibid., p. H4621.
55 See vote no. 185, ibid., p. H4637.
56 See vote no. 186, ibid., p. H4660.
57 See vote no. 187, ibid., p. H4670.
58 See vote no. 133 in the Congressional Record (daily edition), vol. 138, June 30, 1992, p. S9219.
59 See vote no. 134, ibid., p. S9243.
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103rd Congress
In the 103rd Congress, a balanced budget constitutional amendment was once again a significant
issue on the agenda of both the House and Senate. The Senate Judiciary Committee reported
S.J.Res. 41 on October 21, 1993, and the Senate began consideration of the measure on February
22, 1994, under the terms of a unanimous consent agreement. Consideration continued on
February 23, and on February 24 a further unanimous consent agreement provided for Senator
Simon to modify S.J.Res. 41 by incorporating language proposed by Senator John Danforth
limiting the authority of the judiciary to enforce a balanced budget amendment, as well as
allowing Senator Harry Reid to offer a substitute amendment. Senator Reid’s amendment would
have exempted Social Security and capital expenditures from the balanced budget requirement,
and provided for its suspension in times of economic recession. Consideration continued on
February 25, and 28, and March 1. The Senate voted first on the Reid substitute, which failed, 22-
78,60 and then on S.J.Res. 41, as modified, which failed to achieve the necessary two-thirds
majority, 63-37.61
Meanwhile, in the House proponents of a balanced budget amendment let it be known that they
would use the discharge procedure, if necessary, as they had in the past, to bring the issue to the
floor. On February 24, 1994, a petition was filed to discharge the Rules Committee from further
consideration of H.Res. 331, a resolution to extract H.J.Res. 103 from the Judiciary Committee
and provide for its consideration. It received the requisite 218 signatures that same day, and was
placed on the Discharge Calendar. Despite the failure of a balanced budget amendment in the
Senate, on March 11 the House agreed to a unanimous consent request to allow H.Res. 331 to be
called up on March 16 under the same terms and conditions as would govern its consideration
under the discharge rule, but modifying its provisions to decrease general debate time on the
proposed amendment to six hours.
On March 16, 1994, the House approved H.Res. 331 by a vote of 387-22, making it in order to
consider H.J.Res. 103 as well as a series of substitute proposals under a king-of-the-hill rule. A
substitute proposed by Representative Kyl, which would have limited federal outlays to 19% of
GNP and provided for Presidential item veto authority, was subsequently rejected in Committee
of the Whole, 179-242.62 On March 17, the House also rejected in Committee of the Whole a
proposed substitute offered by Representative Robert Wise that would have provided a separate
capital budget and exempted Social Security, by a vote of 111-318.63 Earlier that same day, the
Committee of the Whole rejected a substitute proposed by Representative Barton that would have
limited the growth of federal revenues as well as required a balanced budget, by a vote of 213-
215.64 Because the votes of the Delegates and the Resident Commissioner had been decisive in
the outcome, the vote was taken again in the House pursuant to Rule XXIII and the amendment
was this time adopted, 211-204.65 This substitute was later superseded, however, when the

60 See vote no. 47, in the Congressional Record, daily edition, vol. 140 (March 1, 1994), p. S2089.
61 See vote no. 48, ibid., p. S2158.
62 See vote no. 60 in the Congressional Record, daily edition, v.ol 140 (March 16, 1994), p. H1413.
63 See vote no. 64 in the Congressional Record (daily edition), vol. 140 (March 17, 1994), p. H1473.
64 See vote no. 62, ibid., p. H1461.
65 See vote no. 63, ibid, p. H1462. In the 103rd Congress the House adopted a rule (House Rule XII) which allowed the
four territorial Delegates and the Resident Commissioner from Puerto Rico to vote in Committee of the Whole.
However, a clause was also added to House Rule XXIII which provided that in a circumstance where their votes
affected the outcome the Committee of the Whole would then rise and a new vote be taken in the House where neither
the Delegates nor Resident Commissioner could vote.
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Committee of the Whole agreed by voice vote to a final substitute offered by Representative
Stenholm that would have moved back the effective date of H.Res. 103 to 2001 or two years after
ratification. As thus amended, H.J.Res. 103 was voted on in the House but failed to achieve the
necessary two-thirds majority, 271-153.66
104th Congress
In the 104th Congress, the new Republican majority leadership in the House placed a balanced
budget constitutional amendment on the agenda as part of its “Contract With America.” On
January 4, 1995, Representative Joe Barton (and others) introduced H.J.Res. 1, a proposed
balanced budget constitutional amendment with a tax limitation provision. Following two days of
hearings, the House Judiciary Committee reported the measure with amendments on January 11
(H.Rept. 104-3). On January 24, the House Rules Committee reported H.Res. 44 (H.Rept. 104-4)
providing consideration for H.J.Res. 1 as well as H.Con.Res. 17, outlining an understanding
concerning the treatment of Social Security under any balanced budget constitutional amendment.
After adopting H.Res. 44 on January 25, the House took up H.Con.Res. 17, a measure that its
chief sponsor, Representative Michael Flanagan, described as requiring Congress to “leave the
Federal Old Age and Survivors Insurance trust fund and the Federal Disability trust fund alone
when it is forced to comply with the balanced budget amendment.” H.Con.Res. 17 was adopted
by a vote of 412-18.67
In addition to H.J.Res. 1, H.Res. 44 made in order consideration of six substitutes for it. These
amendments were selected from 44 amendments inserted in the Congressional Record between
on January 13 and 20, pursuant to a notice issued by the House Rules Committee on January 11.
Unlike previous years, these substitutes were not considered under a king-of-the-hill rule. Instead,
H.Res. 44 provided that the House would consider and vote on each of the alternatives, and the
one that received the most votes would be considered as the one that was finally adopted.68
After completing general debate on January 25, the House considered each of the six substitutes
on the following day.
• A substitute offered by Representative Barton, identical to the version approved
by the Judiciary Committee, which required a three-fifths vote to increase tax
revenues. This version was adopted, 253-171.69
• A substitute offered by Representative Major Owens that provided for the waiver
of the Article when the national unemployment rate exceeds 4%, and deleted the
requirement for a three-fifths vote to increase revenues. This version was
rejected, 64-363.70
• A substitute offered by Representative Robert Wise that would have placed
capital investments in physical infrastructure and Social Security transactions off
budget, and required the operating budget to be balanced. In addition, this

66 See vote no. 65 in the Congressional Record, daily edition, vol. 140 (March 17, 1994), p. H1497.
67 See remarks of Representative Michael Flanagan in the Congressional Record (daily edition), v. 141, Jan. 25, 1995,
p. H619; H.Con.Res. 17 approved by vote no. 40, ibid., p. H628.
68 This type of special rule was subsequently dubbed “queen-of-the-hill” by the press.
69 See vote no. 41 in the Congressional Record, daily edition, vol. 141 (January 26, 1995), p. H713.
70 See vote no. 43, ibid., p. H722.
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version did not include special vote requirements for approval of a deficit or
increases in the debt limit or taxes. It was rejected 138-291.71
• An amendment offered by Representative John Conyers that would have placed
Social Security transactions off budget and required congressional action on a
budget plan detailing how a balanced budget would be achieved before the
Article could take effect. It was rejected 112-317.72
• A substitute sponsored by Representative Richard Gephardt and offered by
Representative David Bonior (D-MI) would have placed Social Security
transactions off budget and required an absolute majority of the membership in
each House of Congress for approval of a deficit. This version also deleted any
special vote requirements for increases in the debt limit or taxes. It was rejected
135-296.73
• The final substitute, offered by Representative Dan Schaefer, was similar to the
version reported by the House Judiciary Committee (and offered as an
amendment by Representative Barton) except that it required a majority of the
membership of each House to approve a measure to increase revenues rather than
a super-majority. It was approved 293-139.74
Approval of the Schaefer substitute superseded the prior approval of the Barton substitute
because it had more affirmative votes. As thus amended, H.J.Res. 1 was adopted by the House
300-132, becoming the first proposed balanced budget constitutional amendment to be approved
in the House.75
According to news reports, following the successful passage of H.J.Res. 1 in the House, several
Democratic Senators voiced concern about passage in the Senate without also producing a
detailed plan for deficit reduction. A letter sent to Majority Leader Robert Dole to that effect was
signed by 42 Democratic Senators.76
The Senate had already begun to address some of the issues raised during House consideration
prior to formal consideration of a balanced budget amendment. In particular, the subject of the
treatment of Social Security under a balanced budget constitutional amendment was debated
during consideration of S. 1, the Unfunded Mandates Reform Act.77
The Senate version of the balanced budget amendment, S.J.Res. 1, was introduced by Majority
Leader Dole and others on January 4 and referred to the Senate Judiciary Committee. The
committee held one day of hearings on January 5 and then reported S.J.Res. 1 without
amendment on January 23 (S.Rept. 104-5). On January 27, the Senate agreed by unanimous
consent to begin consideration of H.J.Res. 1 the following Monday, January 30. The Senate

71 See vote no. 44, ibid., p. H731.
72 See vote no. 46, ibid., p. H740.
73 See vote no. 48, ibid., p. H753.
74 See vote no. 49, ibid., p. H770.
75 See vote no. 51, ibid., p. H772.
76 “Amendment Vote Could Signal New Alliance.” Washington Post. Jan. 28, 1995. p. A4.
77 See the debate on the Harkin amendment (90) in the Congressional Record, daily edition, vol. 141 (January 26,
1995), p. S1557, 1583-1599.
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considered the proposal for four days (January 30, 31, February 1, 2) before the first amendments
were offered.
On Friday, February 3, the so-called “right-to-know” amendment was offered by Senator Daschle.
It would have required that a blueprint be established showing how the deficit would be reduced
and eliminated prior to the proposed constitutional amendment becoming effective. After
debating the amendment on February 3, 6, and 7, the Senate voted on February 8 to table a
motion by Senator Daschle to commit H.J.Res. 1 to the Judiciary Committee with instructions
that the Daschle amendment (231) be incorporated into the resolution and reported back. The
Daschle motion and amendment were effectively killed when the motion to table was agreed to
by the Senate, 56-44.78
The second major issue to be addressed by the Senate was the budgetary status and treatment of
Social Security under a balanced budget amendment. The issue was formally raised when Senator
Reid offered an amendment on February 8 to exclude the receipts and outlays of Social Security
from a balanced budget requirement. The Reid amendment (236) was debated on February 8, 9,
10, 13, and 14, before being tabled by the Senate, 57-41.79 Previously, the Senate had agreed by
voice vote to a motion by Majority Leader Dole to commit the measure to the Budget Committee
with instructions that the Committee report back the resolution forthwith, and to report to the
Senate as soon as possible a plan for achieving a balanced budget without affecting Social
Security receipts or payments. A Dole amendment to that motion (238) that established its final
language was agreed to, 87-10.80
After the Reid amendment was disposed of, the Senate considered and rejected several other
amendments on February 14 and 15. On February 16, the Senate voted on a motion entered by
Majority Leader Dole to invoke cloture and limit further consideration of the resolution. That
motion failed to achieve the necessary three-fifths majority, 57-42.81 Later that same day,
however, the Senate did agree by unanimous consent to limit further consideration and provide
for a final vote on the measure on February 28.82 In addition, two cloture votes scheduled for
February 22 were vitiated. Consideration of amendments and motions to refer with instructions
continued on February 22, 23, 24, 27 and 28. On February 28 the Senate agreed to an amendment
offered by Senator Nunn. The Nunn amendment (300, as modified) added language limiting
judicial authority to interpret or enforce the proposed constitutional amendment to situations
specifically authorized by law. The provision was agreed to, 92-8.83 After finishing consideration
of all amendments and motions, the Senate recessed on February 28 and March 1 without taking a
final vote on adopting the proposed constitutional amendment. On March 2 the Senate fell short
of achieving the necessary two-thirds majority, 65-35.84 Majority Leader Dole changed his vote to
the prevailing side (against the amendment) for the final tally in order to take advantage of Senate
Rule XIII and enter a motion to reconsider the vote at a later time.

78 See vote no. 62 in the Congressional Record, daily edition, vol. 141 (February 8, 1995), p. S2307.
79 See vote no. 65 in the Congressional Record, daily edition, vol. 141 (February 14, 1995), p. S2592.
80 See vote no. 63 in the Congressional Record, daily edition, vol. 141 (February 10, 1995), p. S2453.
81 See vote no. 74 in the Congressional Record, daily edition, vol. 141 (February 16, 1995), p. S2778.
82 The remaining amendments and motions to be in order were enumerated, ibid., p. S2820.
83 See vote no. 87 in the Congressional Record, daily edition, vol. 141 (February 28, 1995), p. S3276.
84 See vote no. 98 in the Congressional Record, daily edition, vol. 141 (March 2, 1995), p. S3314.
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On June 4, 1996, the Senate agreed by unanimous consent to the motion to reconsider its earlier
vote. After debating the proposal on June 5 and 6, H.J.Res. 1 again failed to achieve the necessary
two-thirds majority 64-35.85
105th Congress
On January 17, 1997, the Senate Judiciary Committee held a hearing addressing the balanced
budget constitutional amendment issue. Four days later, on January 21, Senator Orrin G. Hatch
introduced S.J.Res. 1, a proposed amendment to the Constitution to require a balanced budget
beginning with FY2002. A second hearing was held on January 22 and the measure was reported
without amendment on January 30 (S.Rept. 105-3). Six amendments, including two substitutes,
were offered during the Committee’s deliberations, but all were rejected.
On February 4, a unanimous consent agreement was propounded to begin consideration of
S.J.Res. 1 on the Senate floor beginning the following day. On February 5, the Senate began
debate on the measure and began consideration of amendments on February 6. As in the 104th
Congress, the issue of the budgetary treatment of Social Security proved to be pivotal, and no
fewer than three of the amendments considered would have excluded it from the amendment’s
provisions. Other issues raised included allowing waivers of the amendment’s provisions for
national emergencies other than actual armed conflict (such as economic emergencies or natural
disasters), and provision for excluding a capital budget from the amendment’s requirements. In
all, 15 amendments (plus one motion to refer with instructions) were considered during
deliberation on the floor, but all were rejected, tabled, or withdrawn.
On February 27, a unanimous consent agreement was reached to provide for a final vote on
March 4. On that day, the measure was defeated by a vote of 66-34, having failed to achieve the
necessary two-thirds.86
A House companion measure, H.J.Res. 1, was considered by the House Judiciary Committee at a
hearing on February 3. The committee began a markup of the measure on February 5 but recessed
without reaching any conclusion. Also on February 5, the House Budget Committee held a
hearing on the issue of a balanced budget amendment.
108th Congress
In February of 2003, H.J.Res. 22 was introduced by Representative Earnest J. Istook with 133
cosponsors. It was referred to the House Committee on the Judiciary and then to the
Subcommittee on the Constitution. On March 6, 2003, the subcommittee held a hearing and on
May 1, 2003, a subcommittee mark-up was held and the measure was subsequently forwarded to
the full committee by a vote of 5-3. On September 22, 2004, the full committee considered the
measure, but it was not reported to the House.

85 See vote no. 158 in the Congressional Record, daily edition, vol. 142 (June 6, 1996), p. S5903.
86 Senate consideration occurred on February 5, 6, 7, 10, 11, 12, 13, 24, 25, 26, 27, and March 4. For the final vote see
vote no. 24 in the Congressional Record, daily edition, vol. 143 (March 4, 1997), p. S1920.
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112th Congress
In January of 2011, Representative Bob Goodlatte introduced H.J.Res. 1, which currently has
more than 130 cosponsors. It was referred to the House Committee on the Judiciary and then to
the Subcommittee on the Constitution. On May 13, the subcommittee held one day of hearings on
proposed amendments to the Constitution to control the federal budget deficit. On June 15, a full
committee mark-up was held and the committee voted to report the bill with an amendment by a
vote of 20-12. As reported by the committee, H.J.Res. 1 includes provisions that would require a
super majority to allow a budget with outlays in excess of receipts, to allow outlays to exceed
18% of the “economic output” of the United States regardless of whether the budget were
balanced, to increase the debt limit, or to increase revenues.
IV. A Constitutional Convention
Article V of the Constitution describes two methods by which the Constitution can be changed.87
To date, constitutional amendments have always been proposed to the states by congressional
action, but Article V of Constitution also provides that “on the application of two-thirds of the
several states Congress shall call a convention for proposing amendments.” Because this method
for proposing a constitutional amendment is untried, there are many unanswered questions about
such a convention.88 A convention would not have the power to amend the Constitution directly,
only to propose an amendment, and any proposed amendment would subsequently need to be
ratified by three-fourths of the states in the same manner as an amendment proposed by Congress.
Since the late 1970s, various interest groups have lobbied state legislatures to petition Congress to
call a constitutional convention to propose an amendment to limit the power of the federal
government to incur budget deficits. The National Taxpayers Union and the National Tax
Limitation Committee, for example, have been active in these efforts to lobby for the proposal in
the state legislatures. A number of other groups, including Citizens to Protect the Constitution
(formerly known as Citizens for the Constitution), the Committee to Preserve the Constitution,
and People for the Constitution, have been active in their opposition to a convention.
These petitions have typically requested that Congress convene a constitutional convention for
the purpose of considering a balanced budget amendment and proposing it to the states for
ratification. Frequently such requests have sought a convention for the “specific and exclusive”
purpose of considering a balanced budget amendment, although some constitutional scholars
suggest that the work of a constitutional convention could not be limited to specific subjects.89 As
a consequence, some opposition to a constitutional convention is based on concern regarding the

87 For a general discussion, see CRS Report 95-589, Amending the U.S. Constitution: by Congress or by Constitutional
Convention
, by Thomas M. Durbin.
88 Laurence H. Tribe, “Issues Raised by Requesting Congress to Call a Constitutional Convention to Propose a
Balanced Budget Amendment.” Pacific Law Journal, vol. 10, July 1979, p. 627.
89 See, for example, Charles L. Black. “Amending the Constitution: A Letter to a Congressman,” Yale Law Journal, v.
82, no. 2, December 1972. p. 189; William W. Van Alstyne, “Does Article V Restrict the States to Calling Unlimited
Conventions Only?—A Letter to a Colleague,” Duke Law Journal, vol. 1978, no. 6., December 1978. p. 1295; Walter
E. Dellinger, “The Recurring Question of the `Limited’ Constitutional Convention,” Yale Law Journal, vol. 88, no. 8,
December 1979. p. 1623; and Michael Stokes Paulsen, “A General Theory of Article V: The Constitutional Lessons of
the Twenty-seventh Amendment,” Yale Law Journal, vol. 103, no. 8, December 1993. p. 677.
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scope of other possible amendments that might also be proposed for ratification as well as
opposition to a balanced budget amendment in particular.
Other related questions have been raised regarding state applications or petitions for a
constitutional convention. Some of these include (1) whether there is a specific procedure that
states must follow for enacting and submitting petitions, (2) whether all the petitions must be in
the same form, and (3) whether they must all be contemporaneous.90 The Senate Judiciary
Committee reported a bill in 1985 that addressed these and other similar questions (S. 40, 99th
Congress, S.Rept. 99-135), but it was not considered further.
Table 4. States That Have Petitioned Congress for a Constitutional Convention to
Propose a Balanced Budget Amendment
State Year State Year
Alabamaa 1976,
1975
Nebraska 1976
Alaska 1982
Nevada
1979,
1977
Arizona
1979, 1977
New Hampshire
1979
Arkansas 1979
New
Mexico
1976
Colorado 1978
North
Carolina
1979
Delaware 1975
North
Dakota
1975
Floridaa 1976
Oklahoma
1976
Georgia 1976
Oregon 1977
Idaho 1979
Pennsylvania
1976
Indiana
1979, 1957
South Carolina
1978, 1976
Iowa 1979
South
Dakota
1979
Kansas 1978
Tennessee
1977
Louisianaa
1979, 1978, 1975 Texas
1978, 1977
Maryland 1975
Utah
1979
Mississippi 1975
Virginia 1976,
1975,
1973
Missouri 1983
Wyoming
1977,
1961
Source: U.S. Library of Congress. Congressional Research Service. State Applications for a Constitutional
Convention to Propose a Balanced Budget Amendment: Analysis and Legislative History. CRS Report by David
Huckabee. (Washington, 1984). p. 26, 27. Updated as applicable.
a. Alabama, Florida, and Louisiana have rescinded their applications for a constitutional convention.
At the beginning of the 100th Congress, 32 of the required 34 states had passed resolutions
requesting a constitutional convention for proposing a balanced budget amendment. In addition to
those states listed in Table 4, at least four states (California, Illinois, Kentucky, and Montana) had
adopted resolutions requesting that Congress propose a deficit spending amendment, but had not
asked for a constitutional convention to do so. By the end of the 100th Congress, however, two
states had rescinded their applications for a constitutional convention. This, coupled with the
possibility that other states would follow suit made the prospect of such a convention less

90 For a broader discussion, see Durbin, Amending the U.S. Constitution: by Congress or by Constitutional Convention.
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imminent. Left unresolved, however, was the legal standing of rescissions, and the question of
whether or not a state has the power to rescind such an application once it has been made.91
On March 22, 1988, the Alabama House of Representatives approved Alabama H.J.Res. 26 to
rescind the state’s 1976 application for a constitutional convention to consider a balanced budget
amendment by voice vote. The measure was then passed by the Senate 15-5 on April 19. After the
joint resolution was vetoed by Governor Hunt on April 26, Alabama’s House of Representatives
voted to reject an amendment proposed by the governor, 81-13, and subsequently to override his
veto, 82-12, on April 28. The Senate also voted to override the veto 27-2 that same day to sustain
the legislature’s position, and to become the first state to make such a withdrawal. Alabama’s
earlier, 1975 application was rescinded in a separate action by voice votes in the House of
Representatives on September 20, and in the Senate on September 22, before being signed by the
governor on September 30, 1988.
In Florida, both of that state’s 1976 applications were rescinded when a Senate memorial was
approved by voice votes on May 12, 1988, in the Senate, and on May 25 in the House of
Representatives.
Although Alabama and Florida were the only states to actually rescind their applications for a
constitutional convention in the 100th Congress, similar measures were passed by one house of
the state legislature in at least five of states, New Hampshire, Oklahoma, Pennsylvania, South
Carolina and Virginia. Louisiana became the third state to vote to rescind its petition for a
constitutional convention when it enacted a resolution to that effect on July 5, 1990.92
V. The Statutory Approach
An alternative for regulating the government’s spending and taxing policies is the enactment of a
statute requiring a balanced budget. Proponents of a statutory approach argue that it would be
more flexible than a constitutional amendment, since the law itself could be modified more easily
by enacting amendments to deal with changing circumstances. Advocates also argue that it could
become effective quickly, in contrast to a constitutional amendment that would require a lengthy
and ultimately uncertain ratification process.
Significant opposition to the statutory approach has come from those who consider it a poor
substitute for a constitutional amendment. These critics contend that the adoption of a law offers
no binding constraint on the actions of future Congresses; in their view the very flexibility of the
approach destroys its utility. They argue that Congress can always waive or reject the rules of a
previous Congress, or can overturn or supersede a statute. Critics offer the past decade’s
experience with attempts to mandate balanced budgets by statutory means as evidence that the
political context makes circumvention virtually certain.

91 Ibid., p. 9.
92 Information on state actions provided by National Taxpayers Union.
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Previous Legislation
There have been many attempts to employ a statutory approach. The first such example is the
amendment proposed by Senator Harry F. Byrd, Jr., in 1978, which became Section 7 of P.L. 95-
435, a measure otherwise dealing with U.S. participation in the International Monetary Fund. The
amendment stated simply that, “Beginning with fiscal year 1981, the total budget outlays of the
federal government shall not exceed its receipts.”93 With almost no debate the amendment was
adopted by the Senate by a vote of 58-28.94 Without any mechanism for enforcement this
commitment proved to be ineffectual, and FY1981 ended with a deficit of $79 billion. Subsequent
modifications of this law have changed it from a specific commitment for FY1981 to a general
affirmation of balanced budgets as a goal.95
A similar provision was included in P.L. 96-5, a measure to provide an increase in the debt limit.
Like the Byrd amendment, the law was superseded by subsequent legislation.
Late in the 98th Congress, the House considered H.R. 6300, a bill to require the President to
submit a balanced budget proposal or, alternately, to explain the reasons why one would be
inappropriate. Although the measure passed under suspension of the rules, 411-11,96 support was
qualified for the measure’s statutory approach because, as Representative Barber Conable said,
“Until we elevate this issue to a constitutional level and create a procedure whereby this Congress
will have to face up to its fiscal responsibilities, things are not going to change.”97 Because the
Congress adjourned shortly thereafter, the Senate did not consider this proposal on the floor.
After it failed to achieve the two-thirds vote necessary for a constitutional amendment in 1990,
the House considered H.R. 5258, a bill to require the President to submit a balanced budget to
Congress each year, for the Budget Committees to report, and for Congress to consider, a budget
resolution that was balanced. However, it did not require Congress to adopt a budget resolution in
balance, nor did it require the fiscal year to end in balance. This measure was criticized by some
as less than a serious attempt to attain balance and one that would merely provide “one more set
of rules to waive.”98 Nevertheless, a majority of the House agreed with Representative Leon
Panetta who said that the measure would require the President and Congress to “lay out in
specific terms how ... to [achieve] a balanced budget” rather than simply establish a balanced
budget as a general goal.99 After a vote to recommit the bill to the Government Operations
Committee with instructions that it hold hearings on its implications failed 181-244, the bill was
passed by a vote of 282-144.100 The Senate took no subsequent action on the measure.

93 P.L. 95-435, 92 Stat. 1053.
94 See vote no. 270 in the Congressional Record, vol. 124, July 31, 1978, p. 23411.
95 The “Byrd amendment” originally appeared at 92 Stat. 1053 and was restated in 1980 in P.L. 96-389, 94 Stat. 1553.
The most recent revision occurred in 1982 in P.L. 97-258, 96 Stat. 908. The text of these provisions appear in
Appendix B.
96 See vote no. 433 in the Congressional Record, daily edition, vol. 130 (October 2, 1984), p. H10858.
97 See remarks of Representative Conable, ibid., p. H10662.
98 See remarks of Representative Robert Walker (R-PA) in the Congressional Record, daily edition, vol. 136 (July 18,
1990), p. H4953.
99 See remarks of Representative Panetta in the Congressional Record, daily edition, vol. 136 (July 18, 1990), p.
H4950.
100 See vote no. 246 in the Congressional Record (daily edition), v. 136, July 18, 1990, p. H4961.
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Gramm-Rudman-Hollings
The most prominent attempt by Congress in to use the statutory approach as a means of achieving
a balanced budget was the Balanced Budget and Emergency Deficit Control Act of 1985 (also
known as the Gramm-Rudman-Hollings Act) and its 1987 Reaffirmation.101 At the heart of this
law was a timetable with mandated annual reductions in budget deficits intended to produce a
balanced budget.
Table 5. Deficit Targets as Provided by the Balanced Budget and Emergency Deficit
Control Act of 1985 and 1987 Reaffirmation
(amounts in billions of dollars)
Fiscal Year
Original Target
1987 Revision
Actual Deficit
1986 171.9

221.2
1987 144

149.8
1988 108 144
155.2
1989 72 136
152.5
1990 36 100
221.2
1991 0 64
269.4
1992 28 290.4
1993
0
255.0
Source: For original target amounts: P.L. 99-177, 99 Stat. 1038-1101; for revised target amounts: P.L. 100-119,
101 Stat. 754-784; for actual amounts: Budget of the United States Government FY2012. Historical Tables. Table
1.1—Summary of Receipts, Outlays, and Surpluses or Deficits: 1789-2016.
In addition to the specific deficit targets included in the text of the law, the act differed from the
earlier Byrd amendment because it included a specific enforcement mechanism. Based on the
assumption that institutional forces made it difficult, if not impossible, to achieve a balanced
budget, the new law established the sequestration process. This process required the President to
issue an order canceling budget authority to reduce the projected deficit to the level mandated by
law. Although the original automatic sequestration mechanism was struck down by the Supreme
Court in Bowsher v. Synar,102 the 1985 law contained a fallback procedure that, lacking the
automatic provision, was felt to be inadequate by Congress. The subsequent enactment of an
amendment to the law in 1987 reinstated a modified procedure for an automatic trigger for the
sequestration process and reaffirmed the desire of Congress to come to grips with the budget
deficit.
The act was amended, and effectively supplanted, in 1990 by the Budget Enforcement Act of
1990 (P.L. 101-508, 104 Stat. 1388-573 through 1388-630). These changes shifted the focus of

101 P.L. 99-177, 99 Stat. 1038-1101, also known as the Gramm-Rudman-Hollings Law. The Balanced Budget and
Emergency Deficit Reduction Reaffirmation Act was contained in P.L. 100-119, 101 Stat. 754-784. For a description of
these measures, see CRS Report R41901, Statutory Budget Controls in Effect Between 1985 and 2002, by Megan
Suzanne Lynch.
102 106 S.Ct. 3181 (1986). A detailed analysis in CRS Report 86-788, Summary and Analysis of the Ramifications of
Bowsher v. Synar, the Gramm-Rudman-Hollings Deficit Reduction Act Case
, by Morton Rosenberg and Richard Ehlke.
(Out of print, but may be obtained from the author.)
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congressional budgetary control from achieving a specific deficit target to limiting congressional
actions that would increase the deficit.103 The new Act retained a series of deficit targets, but these
targets would be adjusted for changing economic and other conditions rather than fixed as they
had been under the 1985 and 1987 Acts. The 1990 Act established deficit targets through FY1995,
but these did not require or project a balanced budget at that time. In 1993, the enforcement
provisions of the Budget Enforcement Act were extended through FY1998 (P.L. 103-66, 107 Stat.
683-685), and in 1997, the enforcement provisions were extended through 2002 (P.L. 105-33) but
again a balanced budget was not required.
VI. Analysis of Typical Provisions of Proposed
Balanced Budget Amendments

What follows is a general discussion of language commonly used in proposals for a balanced
budget amendment. In particular, the discussion addresses provisions that have been included in
balanced budget proposals, and how some of these provisions could be subject to varying
interpretations. Many of the points addressed in this analysis have been raised during previous
consideration of balanced budget amendments, particularly on the floor of the House in 1982,
1990, 1992, 1994, and 1995, and in the Senate in 1982, 1986, 1994, 1995, and 1997.
A number of these interpretations might have achieved some measure of consensus among
Members of Congress concerning their general meaning. However, no determinative judgments
have yet been made on the vast majority of the issues discussed here, and parts of a proposed
amendments’ language may well be subject to interpretation. Especially in the absence of any
extensive legislative history, these unresolved issues would presumably need to be treated by
statute, or interpreted by the courts, or both. Because it would be by its nature new to the federal
government with far reaching consequences, even in its most basic form, a balanced budget
amendment would raise some questions concerning its meaning and enforcement.
All of the proposed amendments have as their central purpose a limitation on the budgetary
freedom of Congress, although they pursue this objective in a number of different ways. Each of
the measures proposes to require a balanced budget, but they display great variety regarding how
to achieve this end and about the nature of the budgetary process and the roles that should be
played in it by the President and Congress.
Use of Estimates
In their most direct form, balanced budget proposals require that “total outlays shall not exceed
total receipts for a fiscal year.” This is most often coupled with a proviso to allow an excess of
outlays if they are approved by a vote of three-fifths in each chamber. Most proposals, either
explicitly or implicitly, would allow any enforcing or implementing legislation to be based on
estimates, but these would generally not supersede the requirement that actual balance at the end
of a fiscal year be measured in absolute terms.

103 For a discussion of the Budget Enforcement Act, see Lynch, Statutory Budget Controls in Effect Between 1985 and
2002
.
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A common alternative approach would permit estimates to be used to measure compliance with
the amendment’s requirements. One common formulation of this is to require that Congress adopt
a statement of receipts and outlays prior to a fiscal year, in which total outlays are not greater than
total receipts. This is sometimes coupled with a provision that “Congress and the President shall
ensure that actual outlays do not exceed the outlays set forth in such statement.” This type of
amendment would thus not require that at the end of the fiscal year the budget be in balance.
Actual outlays could not exceed projected outlays, but the relation between projected and actual
receipts is not explicitly addressed. Receipts less than the projected level would produce a deficit,
but not be a violation of this type of amendment language.
Using estimates to measure compliance could also be applied to both outlays and receipts. This
approach would prohibit estimated outlays from exceeding estimated receipts, but not prohibit
end of the year actual outlays from exceeding end of the year actual receipts. In one form that has
previously been introduced this would simply require a two-thirds vote to approve a budget
resolution that recommends an excess of outlays. Because the amounts in budget resolutions are
projections, such a proposal would not impose any requirement for actual end-of-year balances.
Such an approach is not inconsistent with the practices of some states. According to the General
Accounting Office (now called the Government Accountability Office), at least nine states with
balanced budget requirements do not require a year-end balance, and several others allow a deficit
to be carried over to the next fiscal year if necessary.104
The reliability of estimates is crucial, especially in cases where the proposed amendment would
require adherence to a standard of balance based on actual outlays rather than projected outlays.
Under a variety of circumstances either the President, or Congress, or both would have an
incentive to skew estimates of receipts in the same or opposite directions. If one branch favored
spending cuts, it would have an incentive to estimate receipts at a relatively lower level (and thus
restrain spending). Alternately, if one branch favored relatively higher spending, it would have an
incentive to estimate receipts at a correspondingly higher level. These incentives could have
profound implications for enforcement.
The prohibition on excess outlays in the absence of a three-fifths vote would in most cases be
absolute and require adjustments to compensate for inaccurate estimates of outlays. The inability
to estimate accurately the outlays that will result from entitlements is demonstrated with
regularity. In recent years, supplemental appropriations have been necessary to cover the
mandatory outlays associated with such programs as veterans’ benefits and agricultural subsidies.
There are a number of open questions about the impact of this type of provision on mandatory
spending, especially that which is provided in annual appropriations and supplemental
appropriations acts. Would it have the effect of requiring supplemental appropriations to achieve
three-fifths support in each chamber to provide necessary funds for entitlement programs? Would
it require three-fifths support to allow the release of funds already appropriated but not yet
converted to outlays? If spending must be cut or deferred to keep actual outlays in balance with
receipts during a fiscal year, how would such restrictions be applied to entitlements? Would this
amendment implicitly establish a constitutional power to delay outlays for entitlements, or even
to cancel such payments?

104 California, Connecticut, Delaware, Illinois, Iowa, Nebraska, New Hampshire, Pennsylvania, and Texas all have
balanced budget requirements, but do not require end-of-year balance. In addition, Arizona, Georgia, Louisiana,
Maryland, Massachusetts, New York, Utah, Virginia, Washington, and Wisconsin allow carryover and/or borrowing to
finance a deficit if necessary. Balanced Budget Requirements: State Experiences and Implications for the Federal
Government
, GAO Report AFMD-93-58BR, p. 17.
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Some proposals, while considered as proposed balanced budget amendments, would not actually
prohibit deficit spending. For example, they could simply require that either the President’s
budget or Congress’ concurrent budget resolution be balanced, but not necessarily bar
appropriations or outlays in excess of revenues. Another possibility would mandate that the
budget be balanced only with respect to expected revenues or outlays so that an economic
downturn that decreased revenues and increased outlays would not put the government in
violation of the Constitution. These proposals could pose problems because they contain an
obvious incentive favoring “rosy” forecasting of the economy and of revenues. Many proposals
also provide that the requirement for balance could be waived in certain circumstances. Various
proposals allow for these waivers in the case of a national emergency, low economic growth, a
declaration of war or by congressional passage of a resolution by a super-majority, such as three-
fifths or two-thirds.
Conversely, some proposals seek to prohibit Congress from making appropriations in excess of
anticipated revenues for a fiscal year. These could be narrowly construed so that, to the extent that
deficits result from actions other than those taken by Congress in the appropriations process itself,
the amendment would not be an obstacle to deficits. If this interpretation were to prevail, the
executive departments might be permitted to spend in excess of revenues, provided they had the
budget authority to do so.105
Super-Majority Requirements
The requirement for a super-majority to approve a “specific excess” of outlays over receipts,
while seemingly straightforward, could present issues in implementation. It could simply apply to
a concurrent or joint resolution encompassing the entire budget, but there are other possibilities.
Because no mechanism is provided for identifying the “specific excess” it is not clear what this
means. Conceivably it could be applied to either the amount of money, to the recipient program or
agency, or to both. It is unsettled how the provision would be applied in four different scenarios
that could arise.
• Could the requirement be applied so that each specific program or agency would
need to have a separate three-fifths majority to receive a specific amount of funds
in excess of the overall ceiling?
• Could the three-fifths requirement be applied to a specific total to fund program
shortfalls, which could subsequently be distributed through some mechanism that
did not require a further three-fifths vote?
• Could the three-fifths requirement be applied to the release of funds for
mandatory spending programs or interest on the debt in circumstances where
outlays threaten to exceed receipts after all budgetary legislation has been
enacted?
• Could the requirement be applied to a specific program or agency rather than a
specific dollar amount, so that the agency or program could later receive some
unspecified amount of funding above the outlay ceiling?

105 For example, such budget authority could be in the form of contract or entitlement authority for indefinite amounts
of funds ("such sums as are necessary ...”).
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This ambiguity might give the majority party in either chamber of Congress, through their power
to control the legislative agenda, power to subject the programs least popular with its leadership
to the super-majority threshold. Considering such programs as separate matters could increase the
likelihood of their being unfunded or discontinued. Conversely, the application of this
requirement could also allow the majority leadership to circumvent the amendment and ensure
deficit spending, excluding the most popular programs from any balanced budget regimen. Some
programs might be popular enough to secure funding regardless of the deficit. If such programs
were left unfunded until the ceiling was reached, they could then be funded subject to the
requirement that they have three-fifths support in each chamber. Such a provision also leaves it
unclear of the claims of mandatory outlays, including interest on the debt, in relation to other
outlays in the absence of a balanced budget or a super-majority waiver.
Presidential Responsibility
More basic questions regarding the ultimate responsibility for maintaining a balanced budget are
raised by proposals that establish the seemingly simple mandate that “total outlays of
Government funds during any fiscal year shall not exceed the total revenue of the Government.”
Since outlays (that is, the actual expenditure of funds) are primarily an executive function, such
language could be interpreted as a qualification on presidential spending powers, but not on
Congress’s ability to appropriate funds in excess of revenues. If the President’s spending powers
were thus the primary focus for enforcement, how would this be accomplished? Would it be
necessary to statutorily increase presidential rescission or deferral powers? More significantly,
would an amendment assigning responsibility to the President, either solely or jointly with
Congress, to “ensure that outlays not exceed receipts” imply enhanced impoundment authority?
This possibility suggests that any workable constitutional prohibition on deficit spending take
into account the workings of the federal budget process and expenditure practices, as well as the
division of responsibility between the executive and legislative branches.
Most measures requiring a balanced budget also include a requirement that the President submit a
proposed budget with total outlays not in excess of total receipts. In addition to the requirement
that his budget proposal balance estimated outlays and receipts, such a provision would also
effectively make the President’s role in the budget process a part of the Constitution. The
President’s formal involvement in the budget process currently has a statutory, rather than
constitutional, basis. It stems from the Budget and Accounting Act of 1921 (codified at 31 U.S.C.
1105(a)). Historically, the budget-making process has been the constitutional preserve of
Congress, requiring only the President’s concurrence or passage over his veto.
Although such presidential requirements are generally included in proposals as a way to preserve
symmetry between the executive and legislative branches, this is not precisely the same
requirement that Congress would have to adhere to. Because of the timing of the President’s
budget submission106, the estimates of receipts and outlays used in this proposal would not
necessarily be the same as those used by Congress. This could mean that the President would be
able to use a unilateral estimate to fashion his proposal, while Congress might have to base its
spending actions on an estimate more agreeable to both branches. Also, the President’s proposal
would have to balance estimated outlays against estimated receipts, while under most proposed

106 Under current law (established in Section 13112(a)(4) of the Budget Enforcement Act) the President is required to
submit the budget “On or after the first Monday in January but not later than the first Monday in February of each
year.”
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amendments Congress would ultimately have to balance actual outlays against actual receipts.
This distinction is likely to revive a problem highlighted during the Reagan Administration and
especially under the Balanced Budget and Emergency Deficit Reduction Act. Differing estimates
and projections of the economy and the budget by Congress and the President could make it
difficult to achieve budgetary goals.
Coverage and Exemptions
A concern addressed in many proposals is the issue of coverage. Lengthy debates on which
activities or agencies (if any) should be exempted from the effects of sequestration under the
Balanced Budget and Emergency Deficit Control Act have amply demonstrated the difficulty in
reaching agreement on the issue, as well as the problems associated with exempting certain
activities.
Off-Budget Activities
It is not clear whether the term “off-budget” would continue to have any meaning if a balanced
budget proposal were added to the Constitution. Would the federal government be able to exclude
specific entities from its presentation of the budget? Would an amendment have the effect of
nullifying the current off-budget status of the Postal Service and Social Security? If the terms “all
receipts” and “all outlays” used in many such proposals removed the option to create off-budget
entities, it would also remove the option to consider such entities without regard to their impact
on the remainder of the budget. The debate on the budgetary status of Social Security, for
example, would become moot, and surplus Social Security receipts would constitutionally be
treated in the same way as other government receipts as they are today. Conversely, if federal
agencies or programs could be excluded from the amendment’s coverage by statute, it might open
a channel for manipulating the scope of the “budget” to insure that it was balanced.
Various proposals have sought to anticipate problems that could be brought about by attempts at
circumvention, and have either included or excluded a variety of specific expenses or activities.
These have sought to exempt such things as net interest on the public debt, Social Security, or
federal credit programs. Other measures would be coupled with a capital budget, which would
separate federal expenditures into one budget for current operating expenses and a second one for
net investment in assets that have a useful life of several years. Even so, the question of what
would be included or excluded would have to be addressed. Generally, the more inclusive the
coverage, the more restrictive will be any constitutional limitation (although the reverse is true for
the case of Social Security during the period from now until about 2010).
In contrast to the experiences of states, most proposals at the federal level are planned as
inclusive. They are almost always defined as applying to “all receipts of the United States
Government except those derived from borrowing” and “all outlays of the United States
Government except those for repayment of debt principal.” State governments are typically
required to balance their operating, or general fund, budget, but other major fund groups (such as
capital, enterprise, trust, and other special funds) may not necessarily be required to balance on an
annual basis.107

107 Balanced Budget Requirements: State Experiences and Implications for the Federal Government, GAO Report
AFMD-93-58BR, p. 19.
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The Senate Judiciary Committee’s 1993 report accompanying S.J.Res. 41 expressed the intent of
the Committee that “total receipts” and “total outlays” include “all moneys received by the
Treasury of the United States, either directly or indirectly through Federal or quasi-Federal
agencies created under the authority of acts of Congress.”108 The report further stated that some
programs, such as the electric power program of the Tennessee Valley Authority (TVA), are not
intended to be covered by this definition. The only explanation given is that the program is self-
financing. It is unclear to what extent this interpretation by the Judiciary Committee would be
binding. If it were, it could potentially allow the federal government to follow the state example
and create other special authorities that would not be covered by the amendment’s definitions of
outlays and receipts.
In 1995, one of the chief sources of public opposition to a balanced budget amendment was the
status of Social Security funds. Proposals to exclude the receipts and outlays of the Social
Security Trust Funds (specifically the Federal Old-Age and Survivors Insurance Trust Fund and
the Federal Disability Insurance Trust Fund) from the requirement for a balanced budget were
among the chief topics for debate. Supporters of such an exemption argued that because Social
Security operates with funds that are counted separate from the general fund of the federal
government, and currently operates at a surplus, it should not be subjected to potential benefit
reductions resulting from a deficit in the general fund. Further, they argue, because the
accumulated surplus of the Social Security Trust Funds is held in the form of government
securities, under a balanced budget amendment redemption of these securities, and thus any
expenditure of these funds, would effectively require a budgetary surplus. Opponents counter that
removing such a massive portion of federal transactions, whatever the source, from the discipline
of a balanced budget amendment would undercut the amendment’s effectiveness. In addition,
they believe that an exemption for a specific trust fund could establish a channel for broad
circumvention of an amendment, because it would not necessarily limit the activities that could
be encompassed within the trust fund’s budget.
Non-Budgetary Activities
Government-Sponsored Enterprises (GSEs) are not now considered to be a part of the federal
government, and their transactions are considered to be non-budgetary rather than off-budget.
These are entities established and chartered by the federal government and typically act as
financial intermediaries to influence the allocation of credit in large sectors of the economy.
Examples include the Student Loan Marketing Association, the Federal National Mortgage
Association, and the Federal Home Loan Mortgage Corporation. They are not included in the
federal budget totals because they are classified as private, although most derive special benefits
from their sponsorship by the federal government. Their budgetary treatment and the range of
their activities are not specifically addressed in the language or legislative history of balanced
budget amendments, and it may well be assumed that they would not be included.
Waivers
The most common exception to the requirement for a balanced budget is a waiver in cases of
declared war. Some proposals would also allow a waiver for military emergencies declared by
law. Other provisions in proposed amendments would trigger exemptions or allow waivers. A

108 Senate Judiciary Committee, Report to Accompany S.J.Res. 41, 103rd Cong., 1st Sess., p. 12.
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proposal considered by the Senate in 1994 would have suspended the requirement for a balanced
budget for any fiscal year, and the following fiscal year as well, if the Congressional Budget
Office (CBO) estimates that real economic growth has been or will be less than one percent for
two consecutive quarters during the period of those two fiscal years. Other proposals would allow
a waiver of the balanced budget requirement for any fiscal year in which a declaration of national
emergency were in effect. With the term “national emergency” left undefined, such a provision
might well be applicable to economic as well as military emergencies. It should be noted that the
duration of such a national emergency, or how its end should be determined, is left unstated.
Debt
An issue closely related to balanced budgets is federal debt and the debt limit.109 Indeed, a
number of proposed balanced budget amendments have included provisions that would make it
more difficult to increase the public debt of the United States by requiring a super majority in
each House to enact legislation to do so. The apparent intent is to reinforce the balanced budget
requirement by making it difficult for the amount of federal debt to be increased. Without the
authority to borrow funds, the government could not operate with a deficit. Indeed, some
proposals deal only with debt and require a balanced budget solely by implication. At least one
proposal made in the House would go further and require surpluses in order to pay down the debt.
Of particular importance is the debt to be included in such a limitation. Some proposals would
apply a limitation to increases in the debt “held by the public.” Others would apply the limitation
to the gross public debt (e.g., all federal government debt including that held by the government’s
own trust funds). Another approach has been to apply a limitation to public debt with certain
specified exceptions, such as for trust funds or debt for capital expenditures. These are more than
minor semantic differences, and such provisions could affect aspects of federal finances beyond
the balance of the annual budget. H.J.Res. 1 in the 112th Congress would require a super majority
of three-fifths to increase the limit on the debt held by the public.
As defined in current law and practice, the debt subject to statutory limit includes more than just
the debt held by the public. Debt held by the public involves only money borrowed by the
Treasury from the public, including domestic and foreign individuals and institutions. The debt
subject to statutory limit, however, includes both the debt held by the public and debt held by the
federal government (or intragovernmental debt). Intragovernmental debt includes primarily debt
held by trust funds.
Debt held by the public represents a financial claim by the public on the federal government in
the form of bonds and other debt instruments, and is the measure of debt used in most economic
analyses. The intragovernmental debt held by trust funds does not result in borrowing from world
credit markets or represent a direct financial claim of the public on the government. A trust fund
program itself may entitle recipients to claim present or future program benefits, and securities
are held by the funds as a reserve against future benefits in excess of receipts expected in the
future, but beneficiaries do not have any direct claim on the accumulated debt held by trust funds.
An increase in trust fund holdings also increases the reported gross public debt of the federal
government. Generally such an increase is generated when receipts into trust funds exceed

109 For more on federal debt see CRS Report R41815, Overview of the Federal Debt, by D. Andrew Austin and CRS
Report RL34712, The Federal Debt: An Analysis of Movements from World War II to the Present, by Mindy R. Levit.
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payments. Excess trust fund receipts are invested in federal government debt instruments. The
portion of the gross public debt held by trust funds or other intragovernmental accounts in 2010
was approximately 33%.110
The distinction between gross public debt and debt held by the public could have significant
implications, particularly with regard to the budgetary status of Social Security. Because it is
currently accumulating a surplus for future use, the Social Security trust funds increase the
amount of gross debt. Accordingly, a balanced budget amendment that requires a three-fifths vote
in order to increase the gross public debt could mean that a super-majority was necessary to allow
the surplus held by a trust fund to increase. Even in cases where the trust fund was in balance, the
accumulation of interest on outstanding debt held by the trust fund could itself have the effect of
requiring an increase in the gross public debt. On the other hand, a balanced budget amendment
requiring action to increase the amount of “publically held federal debt” could make it difficult
for Social Security to liquidate its accumulated reserves to pay benefits after about 2020.
Distinctions between classes of federal debt could cause the federal government to operate with
separate statutory debt limits for intragovernmental debt (requiring only a majority vote for
increases) and for debt held by the public.
The division of federal debt instruments into a number of different classes to secure technical
compliance with an amendment could have wider implications as well. Such a phenomenon
would be roughly analogous to state experience, where different debt instruments, including some
not backed by the “full faith and credit” of the government,111 are routinely issued and separately
rated by financial markets.
By many accounts, state experience suggests that constitutional limitations on debt have been less
than wholly effective. State legislatures have devised a wide variety of financing techniques to
comply technically with constitutional limitations on the issuance of debt, including special fund
financing, creation of public authorities and lease arrangements.112 It is not implausible that the
federal government would have occasion to resort to one or more of these devices if limits were
placed on its issuance of new debt.
Tax or Expenditure Limitations
Another broad category of proposals includes those that place a limit on the ability of the federal
government to tax or spend. Some would hold total outlays to a set percentage of some economic
indicator, such as Gross Domestic Product (GDP) or Gross National Product (GNP), while others
would limit increases in spending to a percentage of the growth of a particular economic
indicator. Support for such provisions is derived from two chief premises: (1) the part played by
the federal government in the economy has grown too large in recent decades, and (2) efforts to
balance the budget should be biased in favor of spending cuts rather than tax increases. H.J.Res. 1
in the 112th Congress, for example, would limit the level of outlays to 18% of the “economic

110 U.S. Congressional Budget Office. The Economic and Budget Outlook: Fiscal Years 2011-2021 (Washington: GPO,
2011), Table C-2, p. 125.
111 The term full faith and credit is used to denote an explicit pledge to use the government’s taxing authority to
liquidate the debt.
112 Sterk and Goldman, “Controlling Legislative Shortsightedness: The Effectiveness of Constitutional Debt
Limitations.”
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output” of the United States, regardless of whether the budget is balanced, unless there were a
two-thirds super majority to support the increase.
One significant question is how a provision to limit increases in revenues might be interpreted.
The term “revenue” appears in the Constitution, in this context, in Article I, section 7, the so-
called origination clause. As interpreted by the Supreme Court, the phrase “all bills raising
revenue” has typically meant measures raising revenue to support government generally, but not
those that raise funds to support a specific governmental program.113 This constitutional
understanding of the term “revenue” therefore may differ from that used, for example, in relation
to the jurisdiction of congressional committees or under budgetary statutes (such as the
Congressional Budget Act of 1974). Also it could restrict the application of a tax limitation to
measures that affect money raised for the general fund of the federal government, but exclude
funds raised for specific programs. Another potential difficulty with the definition of revenue is
that not all receipts to the federal government are currently treated equally in the budget process.
Collections from the public based on the government’s exercise of its sovereign powers are
treated as revenues (e.g., personal income taxes). Collections by the government as a result of
business-type or market oriented activities are generally treated as offsets to outlays (e.g., various
royalties and licensing fees). Offsetting collections can be applied either to the outlays of a
specific agency or program or to the government generally. Without further direction, through
more explicit language in a proposed amendment, it is unclear how it might be interpreted.
Conversely, the phrase “increasing revenue” as used in these proposals could be interpreted to
apply these requirements broadly to a wide variety of measures. Such a provision might apply not
only to measures that would increase revenues by increasing the rate of taxation, but also to those
that would increase revenues by lowering the rate of taxation while increasing either the taxable
base or the volume of taxable activity, or both. This interpretation could have an impact on a large
portion of the legislation considered by Congress. Indeed, any legislation that has the direct or
indirect, effect of stimulating economic (hence taxable) activity and thereby increasing revenues
might be covered by a tax limitation provision. One example of increasing revenues by increasing
taxable activity would be a reduction in the tax rate on capital gains income. Although estimates
differ sharply as to the longer-term effect of reducing the capital gains tax rate, the short-term
effect is generally projected to increase revenues as a result of increased realization of capital
gains.
It is not clear whether a limitation on increasing revenues could also be applied to measures, such
as an excise tax on tobacco products, which increase tax rates to a level intended to inhibit a
taxable activity. The intended effect in such a case would be a reduction in revenues, due to the
inhibitory effect, rather than an increase in revenues due to the higher rate. The question remains
as to whether the provision would be interpreted such that the intended effect would exempt such
a measure from the restrictions of a tax limitation provision or such that the increased rate would
be sufficient to place the measure in contravention of the provision.

113 The Supreme Court, in United States v. Munoz-Flores, 495 U.S. 385 (1990), held that a requirement on federal
Courts to impose a monetary “special assessment” on any person convicted of a federal misdemeanor was not a “bill
for raising revenue.”
Justice Story, in Commentaries on the Constitution (Boston, 1833. § 880) wrote that only bills to raise taxes in the
strict sense of the word are “bills for raising revenue;” bills for other purposes, which may incidently create revenue,
are not included. The Supreme Court later held, in Twin City Bank v. Nebeker, 167 U.S. 196 (1897) and Millard v.
Roberts, 202 U.S. 429 (1906), that a bill that creates, and raises revenues to support, a particular governmental
program, as opposed to a bill that raises revenue to support government generally, is not a “bill for raising revenue.”
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Typically, these provisions would limit the rate of increase in revenues to “the rate of increase in
national income in the second prior fiscal year, unless a three-fifths majority of the whole number
of each House of Congress shall have passed a bill directed solely to approving specific
additional receipts and such bill has become law.” This form of limitation is the most common in
recent proposals. Variations have previously been considered in both the Senate and the House.
National income (or any other measure or index) is dependent on a meaning defined either in a
statute or in practice. Proponents argue that such a provision would preserve the current ratio of
federal revenues to the economy as a whole. Detractors of this approach suggest that the
definition of any index would be subject to manipulation, and tax policies would thus hinge on
who controlled the definition. For example, in 1980 the Commerce Department revised the
definition of national income to include most forms of overseas earnings, resulting in a significant
increase in national income. In this case, the action taken did not directly affect the size of the
economy, but did have a significant impact on the calculation of national income. Under a
formula limitation, such actions could make it permissible to increase revenues regardless of the
state of the economy.
In theory, this type of provision could require the government to reduce taxes if revenues were to
increase at a rate faster than the economy because of changing economic conditions. For example,
inflation in the late 1970s caused personal incomes to increase at a greater rate than the economy
as a whole. This resulted in increased federal revenues due to higher income taxes (“bracket
creep”). Although the income tax rate structure is now indexed for inflation, its progressive
structure means that increases in personal income due to economic growth can still result in
revenues increasing at a more rapid rate than the economy. Such a provision could also require a
tax cut following a recession because of an associated downturn in national income.
More importantly, there is a two year lag between when change in national income is measured
and when fiscal policy is enacted. This delay could force the federal government to adopt a
counter-productive fiscal policy.
Another approach would require that measures to increase revenues be passed by a super-majority
of three-fifths or two-thirds of the total membership of each House. This would allow increases in
taxes beyond the rate of growth of national income, but only under one of two circumstances.
First, tax revenues could increase under existing tax laws as a result of economic upturns.
Alternately, they could increase as a result of any new law, if it were passed by super-majority.
This type of tax limitation was endorsed in the “Contract with America” signed by many
Republican candidates for the House of Representatives during the 1994 congressional election.
H.J.Res. 1 in the 112th Congress includes such a provision to require a two-thirds super majority.
Alternately, some proposals might limit taxes indirectly by limiting the level of expenditures.
While this method would not actually prohibit the federal government from taking action to
increase revenues, it would inhibit such increases by removing the primary incentive for doing so.
Even in the 19th century, the federal government did not historically operate with a sustained
budgetary surplus, and it seems unlikely that a mandatory balanced budget would create an
incentive to do so.114 If expenditures were limited, any increases in revenues beyond the level

114 Most periods of sustained surpluses were a result of a deliberate policy to buy down the debt. Examples of this
occurred after federal assumption of state debts associated with the Revolution, and repayment of debts associated with
the Civil War. Sustained surpluses in the absence of such specific aims were politically difficult. For example,
surpluses generated by tariff policy of the late 19th century provoked debates about whether tariff rates should be
lowered or expenditures increased in order to eliminate the surplus. For more on this period see John F. Cogan. “The
(continued...)
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necessary for balance could be applied only towards repayment of debt principal. Because the
repayment of debt principal, and particularly its scheduling, is dependent on the terms under
which such funds were originally borrowed, it seems unlikely that this would provide a
significant incentive for the federal government to operate at a sustained surplus. Without such an
incentive, the indirect effect of an expenditure limit would be to limit taxation.
The levels of the expenditure limits commonly associated with such proposals generally has been
in the range of 18% to 20% of Gross Domestic Product. However, as shown in Table 6, the
current level of expenditures is higher than that. Therefore, such a limitation would require
significant cuts in spending as well as an overall balance of expenditures and revenues.
In any form, a limitation on revenues or outlays could create a bias in favor of tax expenditures.115
Because in most cases these are receipts foregone by the government, rather than actual outlays,
they would likely be largely exempt from any limitations on spending. Proposals to limit the
growth or level of federal taxation would also favor tax expenditures over outlays. Although
increasing receipts and reducing outlays are budgetarily equivalent, a limitation on increases in
receipts would limit Congress’s ability to eliminate tax expenditures to achieve a balanced
budget. This is because eliminating tax expenditures would increase receipts rather than reduce
outlays, and thus increase the risk of running afoul of such a limitation.
Table 6. Federal Outlays and Receipts as a Percent of GDP
Outlays as a
Receipts as a
Fiscal Year
Percent of GDP
Percent of GDP
1950 15.6 14.4
1960 17.8 17.8
1970 19.3 19.0
1980 21.7 19.0
1990 21.9 18.0
2000 18.2 20.6
2010 23.8 14.9
Source: Budget of the United States Government, FY2012. Historical Tables, Table 1.2—Summary of Receipts,
Outlays, and Surpluses or Deficits as Percentages of GDP: 1930-2016
Judicial Review
When the Senate considered a balanced budget amendment during the 103rd Congress, the issue
of judicial review was prominently debated. In particular, the Senate considered a provision to
establish that the power of “any court to order relief pursuant to any case or controversy arising

(...continued)
Evolution of Congressional Budget Decisionmaking and the Emergence of Federal Deficits.” Working Papers in
Political Science
no. P-88-6 (Palo Alto: The Hoover Institution, 1988); and Charles Haines Stewart. Budget Reform
Politics: The Design of the Appropriations Process in the House of Representatives, 1865-1921
(Cambridge [U.K.]:
Cambridge University Press, 1989).
115 For more on tax expenditures generally, see CRS Report RL34622, Tax Expenditures and the Federal Budget, by
Thomas L. Hungerford.
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under this article shall not extend to ordering any remedies other than declaratory judgment or
such remedies as are specifically authorized in implementing legislation.” Such a provision would
leave the judiciary with the authority to issue decisions concerning the meaning of the
amendment or any implementing legislation, but judicial remedies of violations could only be
ordered in circumstances specifically provided by law. Although such declaratory judgments116
would be binding, courts would lack the enforcement remedies of injunctive relief or writs of
mandamus. Enforcement would be left to the elected branches unless the Courts were specifically
provided with authority to use these or other remedies. Limiting the judiciary to declaratory
judgments might not be an entirely empty authority, but its effectiveness would depend on the
parties involved respecting and following the terms of the judgment. Such a limitation on judicial
remedies would represent a significant shift in the balance of power among the three branches of
the federal government, and a departure from the accepted practice that allows courts to interpret
constitutional disputes and determine the appropriate remedy.117

116 By custom dating back to the 1790s, federal courts do not issue opinions which are merely advisory. Declaratory
judgments, according to Aetna Life Ins. Co. v. Haworth, 300 U.S. 227, 241 (1937), are issued in cases of “real and
substantial controversy admitting of specific relief through a decree of a conclusive character, as distinguished from an
opinion advising what the law would be upon a hypothetical state of facts.”
117 In Marbury v. Madison, 1 Cr. (5 U.S.) 137 (1803) Chief Justice John Marshall asserted the Supreme Court’s power
of judicial review, stating that it was “too extravagant to be maintained that the Framers had intended that a case arising
under the constitution should be decided without examining the instrument under which it arises.” For more on the
power of judicial review see Louis Fisher. American Constitutional Law (New York: McGraw-Hill Publishing Co.,
1995).
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Appendix A. Comparison of Deficit Projected in
Presidential Budget Submissions and Actual
Amounts, FY1965-FY2010

Table A-1. Comparison of Deficit Projected in Presidential Budget Submissions and
Actual Amounts, FY1965-FY2010
(billions of current dollars)
Projected Surplus
Actual Surplus(+)/
President Fiscal
Year (+)/Deficit(-)a
Deficit(-)a
Lyndon B. Johnson
1965
-2.9
-0.2
1966
-3.9
-0.5
1967
+0.5
1.1
1968
-4.3
-3.0
1969
+8.0
+3.2
Richard M. Nixon
1970
+3.4
2.8
1971
+1.3
23.0
1972
-11.6
-23.4
1973
-25.5
-14.9
1974
-12.7
-6.1
1975
-9.4
-53.2
Gerald R. Fordb 1976 61.7 -88.4
1977
-43.0
-53.7
Jimmy Carter
1978
-56.1
-59.2
1979
-60.6
-40.7
1980
-29.0
-73.8
1981
-15.8
-79.0
Ronald Reagan
1982 -27.5 -128.0
1983
-91.5
-207.8
1984
-188.8
-185.4
1985
-180.4
-212.3
1986
-180.0
-221.2
1987
-143.6
-149.8
1988
-107.8
-155.2
1989
-129.5
-152.6
George H. W. Bush
1990
-92.5
-221.0
1991
-63.1
-269.2
1992
-280.9
-290.3
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Projected Surplus
Actual Surplus(+)/
President Fiscal
Year (+)/Deficit(-)a
Deficit(-)a
1993
-351.9
-255.0
William J. Clinton 1994
-254.7 -203.2
1995
-176.1
-164.0
1996
-196.7
-107.4
1997
-168.8
-21.9
1998
-120.6
69.3
1999
9.5
125.6
2000
117.3
236.2
2001
184.0
128.2
George W. Bush
2002
231.2
-157.8
2003
-80.2
-377.6
2004
-307.4
-412.7
2005
-363.6
-318.2
2006
-390.1
-248.2
2007
-354.2
-160.7
2008
-239.4
-458.6
2009
-407.4
-1,412.7
Barack Obama
2010
-1,258.4
-1,555.6
Source: Figures for projected deficit are obtained from the budget message of the President in the Budget of
the United States Government for each fiscal year as submitted in January of the previous calendar year. Figures
for actual deficit are obtained from Budget of the United States Government FY2012. Historical Tables. Table
1.1—Summary of Receipts, Outlays, and Surpluses or Deficits: 1789-2016. Figures for FY1965-1968 are for the
consolidated administrative and trust fund budgets. The figures for FY1969-1991 are for the unified budget.
Figures for FY1992-2010 are for the total budget including Social Security, which was placed “off-budget” by the
Budget Enforcement Act of 1990.
a. Surpluses are represented by a plus (+) sign.
b. Figures combine the amounts for FY1976 and the Transition Quarter that occurred when the start of the
fiscal year was shifted from July 1 to October 1.
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Appendix B. Legislative History of the Balanced
Budget Provision in 31 U.S.C. 1103

(formerly 31 U.S.C. 27)
“Byrd Amendment” (named after its sponsor Senator Harry F. Byrd, Jr. (D-VA))
Passed Senate 58-28 (vote no. 270, July 31, 1978), as an amendment to a bill to amend the
Bretton Woods Agreement pertaining to the International Monetary Fund. The House adopted
nonbinding instructions to its conferees on the bill that included agreeing to this provision, by a
vote of 286-91 (roll no. 778, September 14, 1978). It was subsequently incorporated in the final
version of the measure during conference.
The provision has been amended twice although there has been no separate vote in either
chamber on these changes.
P.L. 95-435, 92 Stat. 1051, October 10, 1978
To amend the Bretton Woods Agreement (IMF).
(92 Stat. 1053) “Section 7. Beginning with fiscal year 1981, the total budget outlays of the
Federal Government shall not exceed its receipts.”

P.L. 96-389, 94 Stat. 1551, October 7, 1980
To amend the Bretton Woods Agreement (IMF).
(94 Stat. 1553) “Section 3. Strike section 7 of P.L. 95-435, the Bretton Woods Agreements Act
Amendments of 1978, which reads: `Beginning with Fiscal Year 1981, the total budget outlays of
the Federal Government shall not exceed its receipts.’, and insert in lieu thereof: `The Congress
reaffirms its commitment that beginning with Fiscal Year 1981, the total budget outlays of the
Federal Government shall not exceed its receipts.’.”

P.L. 97-258, 96 Stat. 877, September 13, 1982
To revise, codify and enact without substantive change certain general and permanent laws,
related to money and finance, as title 31, United States Code, “Money and Finance.”
(96 Stat. 908) “Section 1103. Budget ceiling.
Congress reaffirms its commitment that budget outlays of the United States Government for a
fiscal year may not be more than the receipts of the Government for that year.”



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Author Contact Information

James V. Saturno
Megan Suzanne Lynch
Section Research Manager
Analyst on Congress and the Legislative Process
jsaturno@crs.loc.gov, 7-2381
mlynch@crs.loc.gov, 7-7853


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