# Understanding the Balanced Budget Amendment

This is a proposal to change the U.S. Constitution to require the federal government to balance its budget every year—meaning the government would have to spend only as much money as it takes in through taxes and other revenue, just like most families and businesses have to do.

Right now, the federal government can spend more money than it collects and borrow the difference, adding to the national debt. This amendment would make that illegal. Every year, Congress would have to ensure that total spending doesn't exceed total income, with very limited exceptions. The main exception would likely be during wartime, when the government might need special permission from Congress to run a deficit.

This would fundamentally change how the government operates and could affect nearly every American. If passed by Congress and ratified by the states, it would force major decisions about which programs to cut or which taxes to raise. Social Security, Medicare, defense spending, education, infrastructure—everything would be on the table because the government couldn't simply borrow money to cover shortfalls. During economic recessions, when tax revenue drops and demand for government assistance increases, the government would face impossible choices: slash spending during the worst time for the economy, raise taxes when people are struggling, or some combination of both. Supporters argue this would force fiscal responsibility and prevent endless debt accumulation. Critics worry it would cripple the government's ability to respond to emergencies and economic crises, and could lead to severe cuts to vital services that millions of Americans depend on.

A joint resolution proposing an amendment to the Constitution of the United States relative to balancing the budget.

Hyde-Smith, Cindy

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 vote of each chamber. The prohibition excludes outlays for repayment of debt principal and receipts derived from borrowing. The amendment prohibits total outlays for any fiscal year from exceeding 18% of the gross domestic product of the United States, unless two-thirds of each chamber of Congress provides for a specific increase above this amount. The amendment requires a two-thirds vote of each chamber of Congress to impose a new tax, increase the statutory rate of any tax, or increase the aggregate amount of revenue. It requires a three-fifths vote of each chamber to increase the limit on the debt of the United States. The President must submit an annual budget in which total outlays do not exceed total receipts or 18% of the gross domestic product of the United States. The amendment prohibits a court from ordering a revenue increase to enforce the requirements. Congress may waive specified requirements when a declaration of war is in effect or the United States is engaged in a military conflict that causes an imminent and serious military threat to national security.