Hard Going for the Easy Part

By GEORGE J. CHURCH

IN THE ABSTRACT, IT'S AN IDEA THAT wins every popularity contest. A public- opinion poll recorded an 80% majority in favor of amending the Constitution to force a balanced federal budget. Bill Clinton had to twist every Democratic arm in sight to block passage of the 1994 version of such an amendment, and even then it failed to get through the Senate by only four votes. Now the Republican majorities in House and Senate have designated the amendment Resolution No. 1, putting it at the top of the agenda. The White House and its congressional allies have been reduced to guerrilla action aimed more at embarrassing the G.O.P. than at actually defeating the legislation.

Yet the closer it comes to reality, the more controopt pageitversy swirls around the long-gestating amendment (the idea has been debated for at least 15 years). Pro-amendment forces "are fragmenting by the day," crows House Democratic leader Richard Gephardt. Even Speaker Newt Gingrich predicts that the House vote "will be tough" -- although it was supposed to be the easiest part of his vaunted Contract with America to pass. Even if the measure is enacted, the temptation to undermine it over the next few years will be huge, since the cuts required to balance the budget would be deep and painful, an average $170 billion a year.

Actually, most legislators think some sort of amendment will win the required two-thirds vote in both houses of Congress. But Republicans have had to put off debate for a week or more while they get the troops in line. Eventually, the G.O.P. may have to drop a clause specifying that tax increases could be put into effect only by a three-fifths vote of both houses.

Congressional passage, moreover, will not immediately cement an amendment into the Constitution. Three-fourths of the states also would have to ratify it; a mere 13 states could kill the amendment by voting no or declining to take it up. Many state officials are deeply suspicious that Congress would try to balance the federal budget by pushing off onto them the burden of financing needed but expensive spending programs. Congress has pledged to pass quickly a law prohibiting "unfunded mandates" -- that is, orders to the states to do this or that unaccompanied by any federal money to pay the cost. But state skeptics are not mollified; such a prohibition could all too easily be repealed. |

If a balanced-budget amendment does go into effect, what are the chances it will actually bring federal spending down enough to equal revenues by 2002, the current target date? Zero, say many cynics. The pain will be so intense that future Congresses will open loopholes big enough to squeeze huge expenditures through. The most likely strategy: simply remove major categories of spending like Social Security pensions from the official budget, so that they do not count among the expenditures that have to be reduced.

The pain of cutting spending is quickly becoming the focus of attack on the amendment. Economists may debate whether a balanced budget is really desirable, but few legislators dare pose so heretical a question. Purists like Alice Rivlin, the Clinton Administration's budget director, insist the Constitution should not be turned into a vehicle for prescribing detailed fiscal policy, but their voices are being drowned out. However, another of Rivlin's arguments is echoing loudly: balancing the budget by 2002 would require that an average $170 billion a year, or a cumulative $1.2 trillion, be whacked out of anticipated federal spending over the next seven fiscal years, beginning in 1996. How, ask Democrats, would the Republicans do it? A TIME/CNN poll by Yankelovich Partners Inc. shows that respondents turn against the amendment, 59% to 35%, "if it may result in higher taxes or cuts in spending programs such as Medicare and Social Security." But according to Rivlin, exempting those two programs, plus interest on the debt and defense, would force almost a one-third cut in everything else: food stamps, Head Start, federal aid for prison building and highway and bridge repair, meat and poultry inspection, AIDS research -- everything. If the amendment were in effect now, it is questionable whether Washington could give much help, in the form of subsidized loans, to the victims of California's devastating floods.

The Democrats are demanding that the Republicans spell out what they intend to slash before an amendment is voted on. "Our job is to make the Republicans look like they're hiding the truth from the public by not saying what would have to be cut," says a senior Administration official. House majority leader Dick Armey of Texas provided some inadvertent help by blurting out, on NBC- TV's Meet the Press, "Once members of Congress know exactly, chapter and verse, the pain that the government must live with in order to get to a balanced ((budget)), their knees will buckle."

In a way, though, Armey was making -- clumsily -- one of the main arguments of the amendment's boosters. Legislators' knees will always buckle at the thought of resisting the spending demands of the pensioners' lobby, the farm lobby, the welfare lobby, or so this argument goes, and that is why the budget has run a deficit in every year since 1969. The lawmakers can be forced to say no only by a constitutional amendment that gives them no choice. In theory, the budget could be balanced by raising taxes as well as by cutting spending. Conservative Republicans are determined to make it extremely difficult to do so by requiring a 60% vote of both houses to increase taxes. But that provision may not be enactable. In the Senate current nose counts show exactly the 67 votes required for passage -- but for a "naked" amendment without the 60% requirement.

Opponents of the 60% rule insist they have no intention of raising taxes. (Good heavens, no.) But they do not want to rule the idea out of consideration forever. And they fear giving an obstinate congressional minority the power to block any legislation dealing even tangentially with something that could be called a tax. Moderate Republicans and conservative Democrats are coming together on a substitute requirement that tax increases must be approved by a majority of the full membership of both houses, rather than only of those voting, as now.

Another argument involves interpretation: skeptics fear the federal courts will be forced to rule repeatedly on what constitutes an expenditure or a tax, and thus whether an act of Congress violates the amendment. At an extreme, judges might have to decide how high welfare benefits could be. And then there is enforcement: If the amendment is violated, who will be punished, and by whom, and how?

More fundamental still is the question of whether the budget really should be balanced every year. A sudden, deep recession, for example, could throw any budget out of whack by reducing tax collections and increasing spending for unemployment benefits. Restoring balance would require a big tax increase, a sharp cut in spending or both -- and that would make the recession much worse.

The counterargument is that such contentions are an excuse for the failure of Presidents and legislators to exercise any fiscal discipline, resulting in deficits that have mushroomed recently through slump and boom alike and are a severe drag on the economy. It is true that the annual budget deficit has been reduced for three years in a row, but new projections show it rising again in the fiscal year that begins Oct. 1. And though most economists think the trouble is not red ink as such but too much of it, an amendment attempting, say, to hold deficits to no more than 2.5% of gross domestic product would be too complicated even to think about. A balanced-budget amendment probably could be stopped now only if politicians convinced the public that they can enforce fiscal discipline without it -- and it is getting awfully late for that.

CHART: NOT AVAILABLE

CREDIT: From a telephone poll of 1,000 adult Americans taken for TIME/CNN on Jan. 11-12 by Yankelovich Partners Inc. Sampling error is plus/minus 3%. "Not sures" omitted.

CAPTION: Do you favor an amendment requiring the federal government to balance the budget if it results in higher taxes or cuts in programs such as medicare and social security?

Do you approve of the job that the U.S. Congress is doing?

With reporting by James Carney, Suneel Ratan and Karen Tumulty/Washington