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Old 07-15-2011, 07:31 PM  
healthpellets healthpellets is offline
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A Balanced Budget Amendment: Great Idea or Horrible Plan

for the life of me, i can't come up with any reasons why it would be a bad idea.

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The Republican-controlled House of Representatives will act next week on the Cut, Cap, Balance Act, GOP lawmakers announced in a press conference Friday morning.

Not only did Republicans announce the introduction of the Act, but Representatives from Kevin McCarthy of California, Speaker John Boehner of Ohio, Majority Leader Eric Cantor of Virginia and Tom Price of Georgia called on President Obama to “put a real plan on the table” to address fundamental reform and enact serious spending cuts. (August 2 not a hard deadline on debt limit)

In doing so, House Republicans put the spotlight on Democrats and the president for never putting any real plan to paper. The Republican message is, “We’ve done that.”

“Time and time again Republicans have offered serious proposals,” said Speaker Boehner, pointing to the budget proposal offered by Wisconsin Rep. Paul Ryan. “I think it’s time to for Democrats to get serious as well.”

Boehner also reiterated that tax hikes of non-starters and any deal needs to come with real reforms that restrains the growth of spending in the coming years.

Cantor responded to accusations that Republicans have been too stubborn throughout negotiations, refusing to meet the President’s compromise on spending cuts in exchange for some tax hikes. “Reports have indicated that somehow Republicans haven’t given,” said Cantor. “I tell you, that’s just not true.”

“We want to change the system here,” the Majority Leader added. “We want to be able to go home to the people who elected us and show them we’re not going to allow this kind of spending to continue.”

The Cut, Cap, Balance, said Cantor, will “provide a balanced approach so we can demonstrate that we are getting things under control.”

“We will take this bill out of the House,” said McCarthy, the Majority Whip.

House Minority Leader Nancy Pelosi reacted to the Republicans by accusing the GOP of walking away from Obama’s large package and trying to cut the deficit on the backs of “Social Security and Medicare recipients.”

“We support our President on a grand bargain and hope that can still happen,” said Pelosi. “Whatever happens, we will not be reducing benefits for Medicare and Social Security recipients.”

The Cut, Cap, Balance Act ties a vote on raising the $14.3 trillion debt ceiling to spending cuts and caps and the ratification of a balanced budget amendment. The Senate version of the bill gained traction Thursday when Minority Leader Mitch McConnell added his name to the list of co-sponsors.

Copyright © 2009 Daily Caller. All rights reserved.

Read more: http://dailycaller.com/2011/07/15/ho...#ixzz1SE9Wl0pZ
But i guess this guy sees it a bit different...

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Why a balanced budget amendment is economic madness

By Stephen Foley
Sunday, 3 April 2011 at 12:03 am

A very bad idea is back. The idea is to amend the United States Constitution to mandate a balanced federal budget. Tax income and government spending will have to match from now on, so there will be no more credit card spending for which the nation’s children will have to pick up the tab.

That’s the populist refrain from the Republican Party’s 47 Senators, all of whom are co-sponsoring the plan. But a balanced budget amendment is terrible economics. It effectively means an end to counter-cyclical fiscal policy: when a recession strikes, the federal government would not be able to stimulate the economy by spending more. Instead, it must cut back at the same time householders and businesses are doing the same, making the recession worse. It could condemn the US to a perpetual recession, a depression even.

The ability to fight a recession with federal spending is crucial because there are so few alternative tools. Balanced budget rules are in place in most US states. In the most recent recession, enforced austerity at the state level cancelled out most of the economic stimulus introduced by Congress, and spending cuts continue to contribute to high unemployment.

As if the idea is not bad enough, the Republicans have laced their current proposal with more poisonous pills, such as a ban on spending more than 18 per cent of GDP – below the historical norm – and a provision that will make it harder to raise the national debt ceiling. They do allow automatic exemptions to a balanced budget for war spending, but not for economic firefighting. In other times, Congress would need an unlikely two-thirds majority to override the balanced budget rule.

As it is such terrible economics, the tendency has been to assume it cannot pass. It is hard, after all, to amend the Constitution. Even Republican leaders admit the idea is as much about political posturing as it is about seriously tackling the US’s long-term debt crisis. When they vote, as they must, to raise the federal government debt ceiling to avert a catastrophic default by the US, they want to be able to point to other measures to rein in spending.

I would very strongly warn against complacency. Grassroots organisations have been lined up to agitate in support of the plan; Republican governors, including at least two potential presidential candidates, have written in support in the past few days. It could easily become a touchstone issue for next year’s elections, with moderate Democrats not wanting to be seen as weak on cutting the deficit.

Also, a similar proposal came within a single vote of passing Congress in 1995, when public fears over the deficit were high but not nearly as high as they are today.

None of this is to argue that Congress does not need to bring the budget back into balance this economic cycle, or to tackle problems such as spiralling healthcare costs. But these huge, vital tasks require a subtlety and courage that hasn’t been on show this week.

Say no to blunt instruments.

http://blogs.independent.co.uk/2011/...nomic-madness/
Though, I haven't seen how government spending in a recession has helped a damn thing, so not having that options sounds just fine.
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Old 07-15-2011, 07:36 PM   #2
HonestChieffan HonestChieffan is offline
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Its a bad idea if it assumes that there is never a reason or need to go into debt. Would you like to go on a 100% cash flow based lifestyle? Its a good idea only if contingencies are built in an accounted for.
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Old 07-15-2011, 07:50 PM   #3
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Quote:
Originally Posted by HonestChieffan View Post
Would you like to go on a 100% cash flow based lifestyle? Its a good idea only if contingencies are built in an accounted for.
save for my mortgage, that is how i live.

iirc, war time is an exception to the required balancing.
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Romney will win in a landslide 6-10pt victory. Count on it !!!

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Old 07-15-2011, 07:57 PM   #4
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Who knows -- but I do love Obama's response that it isn't needed because the Constitution already requires them to do their jobs. Which is an odd retort since they're not doing their jobs when it comes to keeping America safe against all threats. Not a surprise coming from the guy who baked in spending at unheard of levels and now wants credit for trimming a little of the fat that he put on.
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Old 07-15-2011, 08:01 PM   #5
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Quote:
Originally Posted by HonestChieffan View Post
Its a bad idea if it assumes that there is never a reason or need to go into debt. Would you like to go on a 100% cash flow based lifestyle? Its a good idea only if contingencies are built in an accounted for.
This.

I agree with this completely, it is a stupid idea.
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Old 07-15-2011, 08:16 PM   #6
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Quote:
Originally Posted by alnorth View Post
This.

I agree with this completely, it is a stupid idea.
care to provide some examples as to why?
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Originally Posted by sportsshrink View Post
If you think the 2010 elections where you Marxist Dems got shellacked was bad, get ready for the American civilians version of our D-day at the polls to save this country come this Nov of 2012 !!

Romney will win in a landslide 6-10pt victory. Count on it !!!

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Old 07-15-2011, 08:16 PM   #7
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Originally Posted by RINGLEADER View Post
Who knows -- but I do love Obama's response that it isn't needed because the Constitution already requires them to do their jobs. .
right. still waiting on a budget. any budget.
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If you think the 2010 elections where you Marxist Dems got shellacked was bad, get ready for the American civilians version of our D-day at the polls to save this country come this Nov of 2012 !!

Romney will win in a landslide 6-10pt victory. Count on it !!!

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Mind your own business.
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Old 07-15-2011, 08:27 PM   #8
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Originally Posted by healthpellets View Post
care to provide some examples as to why?
Sure. We have a balanced budget. Revenues = cost, budgeted for the next year.

A cat 5 hurricane plows through Tampa, goes into the Atlantic, regains strength over unusually warm waters, and comes back in to slam North Carolina as a strong cat 3/weak cat 4. It is, by far, the worst natural disaster in American history. The local communities cant cope, and not everything was insured. An immense amount of money is needed by the feds.

We can either borrow the money and figure out how to pay later, or bicker for 6 months on what should be cut, while no assistance or rebuilding money is spent.

A hard balanced budget amendment is stupid. We should instead hold our politicians accountable for letting our finances get out of whack because they spent too much and, yes, by not taxing enough.
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Old 07-15-2011, 08:28 PM   #9
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Originally Posted by alnorth View Post
This.

I agree with this completely, it is a stupid idea.
Limiting powers of any branch would normally have me agreeing with you but these people (in both parties) have no ability to do what's right anymore with respect to this country and the debt burden they've heaped on us and generations to come. This isn't about having "some debt" -- the country is structurally unsound and in one corner we have a party that thinks they're being responsible because they're willing to give up their tenth credit card they planned to open when their first nine are maxed out in a few years while the other party thinks they're being responsible because they're willing to give up the ninth and tenth credit cards they've planned to take on once the first eight are maxed out in a few years.

There is simply no way that we can continue to pay out social security, medicare, and Obamacare the way they are designed and have any money left over for anything else. The politicians are incapable of making the tough calls we need them to make because they're politicians. Taking away their credit cards is fast becoming NOT a stupid idea.
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Old 07-15-2011, 08:30 PM   #10
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Originally Posted by RINGLEADER View Post
Limiting powers of any branch would normally have me agreeing with you but these people (in both parties) have no ability to do what's right anymore with respect to this country and the debt burden they've heaped on us and generations to come. This isn't about having "some debt" -- the country is structurally unsound and in one corner we have a party that thinks they're being responsible because they're willing to give up their tenth credit card they planned to open when their first nine are maxed out in a few years while the other party thinks they're being responsible because they're willing to give up the ninth and tenth credit cards they've planned to take on once the first eight are maxed out in a few years.

There is simply no way that we can continue to pay out social security, medicare, and Obamacare the way they are designed and have any money left over for anything else. The politicians are incapable of making the tough calls we need them to make because they're politicians. Taking away their credit cards is fast becoming NOT a stupid idea.
Saying "we have way too much debt now" has nothing to do with the philosophy of encoding into the law the restriction of never borrowing for any reason.

Our government has to have the ability to run into the red in an emergency. Failing to realize that is just silly.
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Old 07-15-2011, 08:33 PM   #11
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Debt is not a bad thing. TOO MUCH DEBT is a very bad thing.
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Old 07-15-2011, 08:34 PM   #12
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Originally Posted by alnorth View Post
Sure. We have a balanced budget. Revenues = cost, budgeted for the next year.

A cat 5 hurricane plows through Tampa, goes into the Atlantic, regains strength over unusually warm waters, and comes back in to slam North Carolina as a strong cat 3/weak cat 4. It is, by far, the worst natural disaster in American history. The local communities cant cope, and not everything was insured. An immense amount of money is needed by the feds.

We can either borrow the money and figure out how to pay later, or bicker for 6 months on what should be cut, while no assistance or rebuilding money is spent.

A hard balanced budget amendment is stupid. We should instead hold our politicians accountable for letting our finances get out of whack because they spent too much and, yes, by not taxing enough.
OK, have a contingency fund. Most states already do. And just because there are very real examples of how forcing a balanced budget can be tough doesn't make it wrong -- especially when WE HAVE NO MORE MONEY and our ability to borrow from ourselves (or others) to pay our obligations is coming to an end. You can't function as a government very long when you have non-discretionary obligations that are more than 100% of your revenues.

Sort of goes to the heart of why taxes aren't the solution. Eventually the math stops working even if you take every penny of EVERYONE'S money.
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Old 07-15-2011, 08:37 PM   #13
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Saying "we have way too much debt now" has nothing to do with the philosophy of encoding into the law the restriction of never borrowing for any reason.

Our government has to have the ability to run into the red in an emergency. Failing to realize that is just silly.
Our government isn't running into the red because of an emergency. I don't disagree with this point and concur that it would be silly and foolish to not provide flexibility in the case of special situations like the one you laid out, war, etc. But that isn't where we are anymore.

We have $1,000,000,000,000.00+ deficits every year for as long as the eye can see -- and that's IF we meet the growth projections that we're not meeting.
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Old 07-15-2011, 09:48 PM   #14
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Career politicians that print money to buy votes have proven they can do way more damage than a hurricane or any other natural disaster. Maybe if we elected adults it wouldn't be such an issue.

I'm sure there are ways to build fail safes into an ammendment to allow for emergencies. That really is a non-issue.
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Old 07-16-2011, 01:21 AM   #15
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Career politicians that print money to buy votes have proven they can do way more damage than a hurricane or any other natural disaster.
Well put.
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