Balancing the Federal Budget: Examining Proposals for a Balanced Budget Amendment
2025-12-03
Loading video...
Source: Congress.gov
Participants
Transcript
U
Unknown (SPEAKER_16)
The subcommittee will come to order. Without objection, the chair is authorized to declare a recess at any time. We welcome everyone to today's hearing on balancing the federal budget. I will now recognize myself for an opening statement. Today, our national debt is at $38 trillion and counting. In the time it took me to read that first sentence, the debt increased by over $200,000. By this time tomorrow, we'll add $6 billion more. By any calculation, our nation's debt is staggering. For generations, politicians here in Washington have shunned hard conversations about spending, choosing to max out our national credit card and leaving the next generation to foot the bill. Families across our nation have to balance their budgets, and there's no reason their elected leaders shouldn't as well. Americans know that debt comes with strings attached. It's no different for government. Every dollar we spend beyond our means today is a dollar and change we must repay tomorrow. The more America borrows, the more expensive every next borrowed dollar becomes. Indeed, annual federal spending on interest, the price we pay for the last generation's fiscal indiscretion, is now one of the largest line items we have in the budget. We spend more on interest than we do on national defense. We spend more on interest than we do on Medicare. Republicans and Democrats will have different policy ideas and priorities, but surely we can agree that a budget hamstrung by huge interest payments benefits nobody. Our fiscal trajectory is alarming and unsustainable. Make no mistake, a reckoning will come. Indeed, America is already long down the road to a debt crisis. Financial markets have already shown grave concerns about America's long-term debt load. Higher than expected interest rates or other challenges could trigger a debt spiral. It's happened to other countries throughout history. It could happen to us, and without changes, it will happen to us. When that day of reckoning comes, it will be ugly. Spending cuts will be drastic and immediate instead of targeted and phased in over a longer period. Massive tax hikes will take money out of your pocket, not to fund new services, but to pay for services already rendered.
U
Unknown (SPEAKER_16)
It is a matter of when, not if, unless we make changes now while we still can. That's why we're having a hearing today on a balanced budget amendment. A balanced budget amendment would be a possible tool to beat back a future fiscal crisis. It could reduce the cost of living here and now. The enormous federal debt load is already driving up borrowing costs for all Americans, your mortgage, your car payment, and your student loans. We saw the disastrous effects of budget-busting deficit spending during the catastrophic four years of the previous administration. With the eager support of my Democratic colleagues in Congress, the Biden-Harris administration approved $4.7 trillion in new deficit spending, racking up $8.5 trillion in new debt. Now we have the worst inflation in 40 years. When Biden and Harris took office in January 2021, inflation was at just 1.4%, and by the middle of their term, it was over 9%. Inflation is a tax on everyone, but we all know who it hurts the most, the poor, the working class, seniors on fixed incomes, and American families who saw their expenses explode, but no similar increase in their salaries. A balanced budget amendment is a long debated tool that if properly structured, could limit Washington's inflationary overspending and ensure that future federal outlays are funded with actual revenue, not debt and money printing. Indeed, a balanced budget amendment could build on the work we started with the one big beautiful bill. We fought hard to ensure that we kept our promises of fiscal discipline. A balanced budget amendment could force Congress to kick the habit of spending money we don't have once and for all. I hope my colleagues on the other side of the aisle will join us in calling for a full debate and a full consideration of a balanced budget amendment to get our fiscal house in order. Believe it or not, there's a long history of Democrats supporting balanced budget amendments, including former California Governor Jerry Brown.
U
Unknown (SPEAKER_16)
I hope that's still the case today. Let's have a good and honest debate on various proposals. Some proposals allow Congress to approve deficit spending only by a supermajority vote, and some delay the amendment's effective date to allow for a softer landing. I hope that we'll explore these finer points today with our expert panel. The concept of a balanced budget amendment is simple and powerful. it's important that we get the details right.
Sign up for free to see the full transcript
Accounts help us prevent bots from abusing our site. Accounts are free and will allow you to access the full transcript.