Statement of Administration Policy: H.J. Res. 268 - Proposing an Amendment to the Constitution to Provide for a Balanced Budget for the United States Government and for Greater Accountability in the Enactment of Tax Legislation

FINAL

(House Rules)
(Stenholm (D) Texas and 250 others)

The Administration urges prompt adoption of H.J. Res. 268 so that it may be sent to the States for ratification as an amendment to the Constitution. In a recent letter to Congress endorsing S. J. Res. 12, a balanced budget amendment sponsored by Senator Thurmond, the President stated that:

"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."

It is our understanding that an amendment is being offered by Representative Cox that would include a line-item veto mechanism as part of the balanced budget amendment. The Administration supports Mr. Cox's proposal.

The Administration notes two technical concerns with the proposed constitutional amendment, as proposed in H.J. Res. 268.

Section 2 would require that "[t]he public debt of the United States shall not be increased unless three-fifths of the total membership of each House shall provide by law for such an increase by a rollcall vote. " The public debt includes Treasury securities held by Government trust funds. If the trust fund surpluses increase and the increases are invested in Treasury securities, the public debt will increase, even if a balance is achieved in the overall budget. This problem would be overcome by inserting the words "held by the public" after "United States."

Section 4 would require that "[n]o bill to increase revenue shall become law unless approved by a majority of the total membership of each House by a rollcall vote." This section uses the term "revenue," rather than "taxes." "Revenue" could be construed broadly to include any increase in receipts, not just taxes.

Such an interpretation might impede increases in non-tax revenues, such as user fees. The language included in S. J. Res. 12, which uses the term "taxes, " would overcome this problem.