# Understanding the Balanced Budget Amendment Proposal

This proposal would add a new rule to the U.S. Constitution requiring the federal government to balance its budget every year, meaning the government couldn't spend more money than it takes in—similar to how most families or businesses have to operate. Right now, the government regularly spends more money than it collects in taxes and other revenue, borrowing the difference. This amendment would essentially make that illegal, with only one exception: Congress could vote to approve deficit spending if two-thirds of both the House and Senate agree to it.

The practical effect would be dramatic. Every year, the President would have to propose a budget where spending equals income, and Congress would have to pass a balanced budget or face a constitutional violation. This means the government would need to either raise taxes, cut spending, or do both whenever revenues fall short. During economic downturns when tax revenue naturally drops, this could force immediate cuts to programs like Social Security, Medicare, defense, education, or infrastructure—or require tax increases—unless two-thirds of Congress votes otherwise. The amendment wouldn't take effect for five years after states ratify it, giving some time to prepare.

To become part of the Constitution, this amendment would need to pass Congress (which this proposal does) and then be approved by three-fourths of state legislatures within seven years. Supporters argue this would force fiscal responsibility and prevent endless government debt. Critics worry it would eliminate flexibility during recessions, force painful spending cuts or tax hikes at the worst times, and potentially harm the economy when the government needs to spend money to stimulate recovery.

Proposing a balanced budget amendment to the Constitution of the United States.

Obernolte, Jay

<p>This joint resolution proposes a constitutional amendment prohibiting total outlays for a fiscal year from exceeding total receipts for that fiscal year unless Congress authorizes the excess by a two-thirds roll call vote of each chamber. The prohibition excludes outlays for repayment of debt principal and receipts derived from borrowing.</p> <p>The amendment also requires the President to submit an annual budget in which total outlays do not exceed total receipts. </p>