Proposing a balanced budget amendment to the Constitution of the United States.
- Bill Number
- H.J.Res. 2
- Origin Chamber
- House
- Congress
- 119th Congress, Session 1
- Policy Area
- Economics and Public Finance
- Status
- Introduced
- Latest Action
- 2025-01-03: Referred to the House Committee on the Judiciary.
- Last Updated
- 2026-06-11T23:26:39Z
AI-Generated Summary
Purpose
This joint resolution (H.J. Res. 2) proposes an amendment to the U.S. Constitution to enforce fiscal discipline by requiring the federal government to balance its budget annually, limit debt increases, and impose stricter rules for raising revenue. The goal is to prevent ongoing federal deficits and excessive borrowing.
Key Provisions
- Section 1: Total government spending (outlays) for any fiscal year cannot exceed total revenue (receipts) collected in that year, ensuring a balanced budget without deficits.
- Section 2: The existing limit on U.S. public debt (money owed to external holders like investors) cannot be raised, prohibiting Congress from authorizing more borrowing beyond current levels.
- Section 3: Any legislation to increase taxes or other revenue must be approved by a two-thirds supermajority vote in both the House and Senate, conducted by a recorded rollcall vote for transparency.
The amendment would take effect once ratified by the legislatures of three-fourths (38) of the states, following approval by two-thirds of both houses of Congress.
Significant Changes to Existing Law
- This would introduce new constitutional mandates on federal budgeting, which currently allow deficits and debt increases through regular legislation (simple majority votes).
- It eliminates flexibility for annual deficits, overrides the statutory debt ceiling process (which Congress routinely adjusts), and raises the threshold for tax hikes from a simple majority to a supermajority, fundamentally altering how fiscal policy is made.
Potential Impacts
- On Government Agencies: Federal agencies and programs (e.g., defense, social services, infrastructure) may face automatic spending cuts or prioritization during revenue shortfalls, potentially reducing funding for discretionary and mandatory programs.
- On Citizens: Could lead to lower taxes in the long term by curbing spending but might result in reduced government services, benefits, or investments in areas like education and healthcare; economic downturns could exacerbate these effects without deficit spending options.
- On International Relations: Limits on U.S. debt could affect global financial markets, as the U.S. dollar and Treasury securities are key to international trade and stability; reduced borrowing capacity might signal fiscal restraint, influencing alliances or aid commitments.
Main Stakeholders Affected
- Congress and Federal Government: Directly constrained in budgeting, taxing, and borrowing powers.
- State Governments: Involved in the ratification process; may benefit from reduced federal deficits but could see shifts in federal funding.
- Taxpayers and Citizens: Impacted by potential changes in taxes, public services, and economic stability.
- Financial Markets and Investors: Affected by restrictions on U.S. debt issuance, which could influence interest rates and global confidence in U.S. fiscal policy.
Notable Legal, Constitutional, or Political Implications
- Constitutional: Adds a rigid fiscal clause to the Constitution (similar to state-level balanced budget requirements), potentially conflicting with existing clauses on Congress's spending and taxing powers (Article I, Section 8); exceptions for emergencies (e.g., wars) are not specified, which could lead to future court challenges.
- Legal: Once ratified, it would be enforceable by courts, possibly requiring new mechanisms to verify compliance; violates current practices where deficits are funded by borrowing.
- Political: Shifts power dynamics by making deficit spending and tax increases harder, favoring fiscal conservatives but sparking debates on economic flexibility during crises; ratification process could polarize states and influence national elections.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Recent Actions
- 2025-01-03: Referred to the House Committee on the Judiciary.
- 2025-01-03: Introduced in House
- 2025-01-03: Introduced in House
Bill Versions
- Proposing a balanced budget amendment to the Constitution of the United States. — issued 2025-01-03 — PDF (2 pages)