HJRES 17119th CongressIn Committee

Proposing a balanced budget amendment to the Constitution of the United States.

Introduced: Jan 13, 2025

Standard Summary

Comprehensive overview in 1-2 paragraphs

H.J. Res. 17 proposes a constitutional amendment that would establish a balanced-budget requirement for the United States. Under the amendment, annual federal outlays could not exceed total receipts for the year unless both chambers of Congress (in a rollcall vote) approve by a two-thirds vote a specific excess of outlays over receipts. The President would be required to transmit a yearly budget proposal showing outlays not exceeding receipts. The amendment would be enforced by Congress through legislation and would use a defined accounting framework that excludes debt principal repayments from outlays and excludes borrowing from receipts. The amendment would take effect starting in the fifth fiscal year after ratification, after a four-year transition period. In short, the measure aims to eliminate deficits by law, requiring a balanced annual budget or a high-level, supermajority authorization to run a deficit, with a defined method for calculating receipts and outlays and a staged start date.

Key Points

1Balanced-budget baseline and deficit exception
2- Total outlays in a fiscal year may not exceed total receipts unless both Houses of Congress, by a two-thirds vote, authorize a specific excess of outlays over receipts through law (roll-call vote).
3President’s annual balanced-budget proposal
4- Before each fiscal year, the President must submit a budget proposal in which total outlays do not exceed total receipts.
5Enforcement and implementation
6- Congress is given responsibility to enforce and implement the amendment through appropriate legislation, which may rely on estimates of outlays and receipts.
7Defined accounting terms
8- Receipts: all federal receipts except those from borrowing.
9- Outlays: all federal outlays except for repayments of debt principal (i.e., interest and other spending count, but principal repayments do not).
10Transition and effective date
11- The article takes effect beginning with the fifth fiscal year after ratification, providing a four-year transition period.

Impact Areas

Primary group/area affected- Federal taxpayers and beneficiaries: The structure could affect federal spending programs (discretionary and mandatory) and tax/receipts, influencing how we fund programs like defense, social programs, and infrastructure.Secondary group/area affected- Federal fiscal policymakers (President, Congress) and debt markets: May constrain budget policy, affect debt issuance, interest costs, and the political process around approving deficits.Additional impacts- Economic policy and recession response: The deficit constraint could limit countercyclical policy (e.g., stimulus during downturns) unless a supermajority vote is obtained, potentially reducing the government's ability to respond to recessions.- State and local funding and private sector effects: States and recipients of federal funds may experience changes in annual funding levels and timing, with downstream effects on programs and services.- Long-term debt sustainability and credit considerations: The amendment could influence the trajectory of debt and the credibility of the U.S. fiscal framework, with potential implications for credit ratings and borrowing costs.

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