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This Constitution Day Compact for a Balanced Budget! By Nick Dranias, J.D.

The Founders meant to establish a federal government of limited and enumerated powers. It was supposed to be an island of power in a sea of liberty. The states, being more responsive to the People and local conditions, were supposed to hold the greater bulk of governing powers.

Sadly, on this Constitution Day, we must admit that the Founders’ Constitution is hanging by a thread. Although a deterioration in our culture is a significant cause of its frayed condition, the truth is that our Constitution was designed to handle a heavy load of bad actors. It was not designed for angels because, after all, if men were angels, they would not need government.

The Constitution’s secret to holding in check bad people was its structure. It divided power between and among departments of the federal government (and between the federal government and the states), ensuring that bad influences could not easily or naturally consolidate all power in one convenient location. This division of power also ensured that ambition held ambition in check—the striving of bad actors in one department would be resisted not only by good actors, but also by the striving of bad actors in another department.

More than any other feature of the Constitution, it is this structural component that has managed to protect what liberty we currently enjoy—far more so than the undeniably inspiring and insightful words of the Bill of Rights.

Likewise, the structural defects in the Constitution’s original and current design are the more proximate cause of its decline. These defects can only be corrected by amending the Constitution to fix what was broken from the beginning and restore what was lost. Simply put, only structural reform can mend structural defects.

First, we need to recognize that the Founders made a mistake in delegating the federal government unlimited borrowing capacity. Unlimited borrowing capacity presented the Founders and their successors with an irresistible temptation to empower the federal government build, buy and do whatever they wanted at little or no immediate political cost and plenty of immediate political gain—with all costs shifted to future, non-voting generations. This temptation, combined with the decline of cultural adherence to limited government principles, has naturally motivated the political class to interpret the Constitution to allow for ever greater federal power. Except for Thomas Jefferson (who recognized the defect no later than 1798), the Founders sadly failed to fully appreciate how no parchment barrier could hold back the demands for unlimited government when unlimited borrowing capacity could create the appearance of unlimited resources. The Founders were great men, but not perfect men. Some had great moral failings. It should not be surprising they rendered a handful of bad policy judgments.

Only a constitutional amendment that limits the borrowing capacity of the federal government can fix this original structural defect of the Constitution—just as only the 13th Amendment could fix the Constitution’s “original sin” of tolerating slavery. By limiting the federal government’s available credit, we can force the political class to treat the federal government’s resources as limited, require the political class to set priorities, and thereby incentivize the political class to return to first principles in deciding what the federal government should be doing.

For this reason, an amendment to limit the federal debt is a necessary element of restoring the Constitution’s original intent of a federal government of limited and enumerated powers. Concededly, such an amendment is not sufficient—education must rebuild respect for limited government principles—but if the federal government never experiences the humility that limited resources encourages, it will always suffer from the hubris that it can do everything under the sun.

Second, we need to recognize that the 16th Amendment (Income Tax) and the 17th Amendment (Popular Election of U.S. Senators) dramatically altered the federal government’s power structure to favor unlimited growth. As we saw with the Supreme Court’s decision to uphold the federal health care law, the income tax can be used to disincentivize any personal decision that the federal government disfavors—including the decision not to buy health insurance. The 16th Amendment has thus enabled the federal government to claim essentially unlimited governing power—provided that its mandates are backed by a threat of taxation rather than jail time.

The 17th Amendment yanked the states out of the U.S. Senate, rendering the Senate a small version of the House. By eliminating the institutional interests of the states from direct representation in Congress, the 17th Amendment dissolved a division of power which allowed for a distinct set of diverse state and local ambitions to check and balance the centralized, national and international ambitions of the denizens of Washington. It made Congress a more homogenous entity, with a more uniform set of interests, and therefore an entity whose powers can be more easily leveraged by the President, interest groups, and the permanent political class in Washington—and more easily abused by the heavy load of bad actors who seem to be increasingly drawn to politics.

Aside from depriving the states of 50% of the legislative power of the federal government, the 17th Amendment also deprived the states of any power to reject Supreme Court nominees and to reject the ratification of treaties. It should not be any wonder that, despite a few recent blips in the right direction, the Supreme Court has trended away from enforcing principles of state sovereignty in its decisions. Nor should it be any surprise that international treaties increasingly encroach on state and local governmental policy making. Nor should it be any surprise that states west of the Mississippi, many of which were just getting their political legs around the time of the ratification of the 17th Amendment, find themselves trapped by federal laws that have perpetually placed 20% to over 80% of their lands under federal ownership or jurisdiction—literally unable to exercise one of the most fundamental attributes of sovereignty, control over the lands and waters within their borders. This post-17th Amendment power structure has naturally caused the federal government to grow beyond its limited and enumerated powers, displacing state and local government, as well as individual liberty.

Nothing short of a constitutional amendment can fix the structural defects introduced into the Constitution by the 16th and 17th Amendments. If we do nothing to fix these defects, the expansive course of the federal government into every nook and cranny of our society will prove politically irresistible over time—especially when combined with the temptations of unlimited borrowing capacity. All governing powers will inevitably be drawn to a centralized federal authority; such powers will be easily leveraged and abused; and the risk of tyranny—either of the hard (go to jail for NSA-disapproved thoughts) or soft (pay $1,000 income tax penalty for not eating your broccoli) variety—will increase exponentially.

That’s why every true patriot should pledge to support the Compact for a Balanced Budget. The Compact makes it possible to amend the constitution to mend these devastating structural defects in the near future—before the system is completely corrupted.

The Compact advances a powerful Balanced Budget Amendment that will constitutionally limit the borrowing capacity of the federal government. The Amendment also restores a portion of the national policy-making authority of the states deprived by the 17th Amendment by requiring any increase in that debt limit to be approved by a majority of state legislatures. Finally, the Amendment restrains the abusive reach of the 16th Amendment by imposing a tax limit that requires a two-thirds vote of each house of Congress to sustain any new or increased income or sales tax, reserving the current simple majority rule only for revenue increases resulting from switching to a fair tax, flat tax, or a greater reliance on tariffs or fees.

In short, the constitutional reforms promised by the Compact for a Balanced Budget will move the Constitution closer to its original design and intent: a federal government of truly limited and enumerated powers.

While the Compact will not immediately restore the Constitution to the Founders’ original vision, its success will prove a concept that can be deployed again and again to finish the job. For this reason, those who truly believe in the Founders’ vision should join the Compact for America initiative—especially on this Constitution Day.


Read this Heartland Institute report for more of Nick's thoughts about the unique merits of the Compact for a Balanced Budget.

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