Balancing the budget via veto: "... a new set of checks and balances effectively would be created: Congressional spending would be checked by the president's reduction veto power, and abuse ... would be balanced by Congress' ability to cancel the power with a budget surplus".

• Author: Hawks, Anthony W.
• Position: National Affairs

FALLING DEFENSE SPENDING and the economic boom of the 1990s helped create the first balanced Federal budget in 29 years in fiscal year 1998. However, it did not last long and surpluses have since flipped to annual deficits of more than $400,000,000,000. New national security concerns seem to have caused Congress and the Administration to open the spending floodgates to a wide range of defense and nondefense increases. To curb spending and ensure that large deficits do not once again become the norm, some sort of institutional check is needed. Historically, fiscal conservatives have sought restraint from a line item veto or balanced budget amendment (BBA) to the Constitution. Those proposals thus far have failed because they have been ill-defined or technically flawed. Besides, they offered no assurance that spending would be constrained. Moreover, supporters have not overcome the political and constitutional objections that such proposals would weaken the congressional "power of the purse" and shift budgetary control to the president or the Federal courts.

A BBA coupled with a supermajority voting requirement to protect against tax increases would be a valuable constraint. Yet, such a reform has not garnered enough political support for passage. The traditional line item veto may be a useful means for cutting spending, but the president also could employ it as a threat to veto spending to gain support for his own increases. These two concepts, however, can be integrated into a "balanced budget veto" (BBV), whereby the line item veto would become a self-executing means for enforcing budget balance in a manner that promotes spending restraint.

The BBV is a novel form of line item veto that would eliminate what always has been the fatal flaw in any balanced budget mandate--the lack of an effective enforcement mechanism favoring spending cuts over tax increases. The BBV is not the simple adoption of a line item veto and BBA simultaneously, Rather, it would be directed at the specific goal of balancing the budget by making its use conditional on the budget being unbalanced. In other words, the president would be able to exercise a line item veto only when Congress failed to control costs. A bright-line test would be used to determine if a fiscal year ended with a deficit, and, if it did, the president would be empowered with line item veto authority throughout the next annual session of Congress.

For practical and technical reasons relating to the nature of the Federal budget process, the veto enforcement itself would be a power to reduce specific monetary amounts rather than a true "item" veto. It would not enshrine balanced budgets as constitutional doctrine. Instead, it would create an incentive for Congress to curb Federal deficits as soon as possible to regain the spending controls that a veto otherwise would bestow upon the president. in effect, Congress would be penalized institutionally and politically for not balancing the budget. The resulting transfer of power to the president would act as a counterweight and fiscal control mechanism lacking in current balanced budget proposals. The president would be expected to use this enhanced prerogative to cut spending or face criticism from Congress and the public that would view costly presidential initiatives as cynical attempts to retain the veto function. Most important, in the best tradition of our...