Letter to Congressional Leaders on Federal Budget Reform

Dear Mr. Speaker: [Dear Mr. President:]

Today I am proposing to the Congress a budget reform package. In order to help restore fiscal integrity, we need a balanced budget amendment to the Constitution, a line-item veto constitutional amendment, and enhanced rescission authority for the President. These tools -- together with political courage and discipline -- are vital to solving the problem of budget deficits.

The most fundamental change needed in the Federal budget process is a constitutional amendment to require a balanced budget. A balanced budget amendment is both necessary and appropriate to protect the interests of a group of citizens not now able to represent themselves: the citizens of future generations. More than 30 State legislatures have already called for a constitutional convention for this purpose.

A balanced budget amendment must also include safeguards against a resort to higher taxes as a means of complying with the constitutional mandate. Senate Joint Resolution 12, a balanced budget amendment introduced by Senator Thurmond, includes such a safeguard and has my full support. There is, however, one change I would make in S.J. Res. 12: the mandate for a balanced budget should be effective beginning with fiscal year 1993. The current Gramm-Rudman-Hollings law requires elimination of the deficit by that time, and the balanced budget amendment will help ensure that the Federal budget stays in balance thereafter.

Second, as President, I repeat the call of many of my predecessors for the line-item veto. The President needs the power to remove individual and unnecessary expenditures that have been made a part of major appropriations bills without sacrificing entire legislative enactments. This power would give the President the same tool that 43 Governors have -- the line-item veto. With that power, we can put the national interest above the special interests. Therefore, I am submitting to the Congress today a proposed amendment to the Constitution granting such authority.

Finally, we need to correct the budget procedure known as rescission. Present law allows for cancellation of an appropriation only through the rescission process, in which the Congress can reject a Presidential proposal for rescission simply by inaction. That is precisely what happened to the vast majority of rescission proposals submitted by three Presidents since the present law was enacted in 1974.

Thus, I urge passage of The Legislative Line-Item Veto Act of 1989 (H.R. 3271 and H.R. 3583, companion bills to S. 1553) [(S. 1553)], which would provide enhanced rescission authority to the President. I commend, in particular, Representatives Tom Tauke, Larry Craig, Lynn Martin, and Bob McEwen for their leadership in introducing this important legislation. [I commend, in particular, Senators Dole, Domenici, Armstrong, Humphrey, McCain, and Coats for their work in drawing together this important legislation]. This legislation will provide the President with strong and effective authority to rescind appropriations that are wasteful or unnecessary.

I am prepared to work with the Congress to enact meaningful, credible, and effective budget reforms. Getting our fiscal house in order is crucial to our Nation's long-term economic health and prosperity.

Sincerely,

George Bush