Quote:
Originally Posted by florida.bob
The Repubs will likely bring this back up and there is a significant amount of public support for such an amendment. So it will provide them some political talking points for Nov., but the reality is, it would require 2 thirds vote in House and Senate, plus 38 States to ratify. Not going to happen, anytime soon, it would take many years to get it done. Who knows, the President's Deficit Commission may suggest some form of that. Right now, its just going to be meaningless talking point politics, much like the meaningless talking points on the 14th Amendment.
Republicans see balanced budget amendment as potent campaign weapon - TheHill.com |
While it is a noble and an idea I agree with in theory, in actuality passing this would cause the largest tax increase in history.
Annual spending from all sources is $3.5 Billion (2.2 B mandatory and 1.3 B discretionary).
Annual receipts from all sources is ~$2.35 Billion.
Receipts currently equal "mandatory spending." This includes Interest Payments, Social Security, Medicare/aid, and other mandatory programs put in law by congress.
Discretionary spending is about equal to our annual deficit.
2/3rds of our discretionary spending is defense. I would argue no one wants to get rid of that (save some loons).
So we are left with $400 billion for the rest of the federal government. So we completely get rid of the ENTIRE federal government minus defense and we still have an $800 billion deficit.
Tax time!
Now if you go and argue about getting rid of the mandatory (different law then a balanced budget amendment), thats good and all but good luck with that. We need to cut benefits by about 50%...
Now lets "pretend" we cut government spending by 20% (that is huge and a bare bones government) and all mandatory benefits by 20% (again huge), we still have a deficit and therefore must raise taxes.
How much of an increase with a 20% cross the board reduction to EVERY government program?
Taxes revenue needed would be near $500 billion, or 20% of total tax receipts.
Are you all prepared for a 20% increase in taxes WITH no government support for anything?
Truth of the matter is:
We're screwed...
If the above "scenario" happened, it would be immediate
depression according to GDP and employment figures.
We literally are in a mess that can only be fixed by massive growth (education and babies folks) and honestly...
inflation.
It sucks, but there is no other answer.
I do agree we need to do some MAJOR CUTS to the government spending though; just be prepared for the pain for a decade (which must happen to fix this!)
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