Commentary

Constitutional Fix to Overspending

Tea Party members are going to be very unhappy. Many of the new members of the House and Senate that the Tea Party helped elect are already becoming part of the political class, as evidenced by their votes for continued farm subsidies, refusals to put reasonable limits on the growth of the food-stamp program, support for unaccountable international organizations, and on and on. Members of Congress vote for unjustified spending because they think the recipients will reward them with campaign contributions and praise while the majority of the electorate will never notice.

Well-known and highly respected public opinion pollster Scott Rasmussen explains in his new book, “The People’s Money,” why the political class always ends up supporting far more spending and taxing than the majority of voters want. Mr. Rasmussen notes: “The gap exists today because just about every budget-cutting proposal favored by the American people involves shifting power away from official Washington… At the other extreme is the Political Class dream of even more power, authority and money flowing into Washington.”

The benefits of any specific government spending program tend to be concentrated, while the costs are dispersed among almost everyone. As a result, those who benefit are willing to spend time and money to line their own pocketbooks, while the cost of each program is normally so small as not to be noticed by the taxpayers or worth the necessary effort to stop it. But the sum total of all the spending is what kills liberty and the economy. This is why almost all democracies eventually fail.

The American Founding Fathers well understood the problem, which is why they created a constitutional federal republic. The Constitution, by design, is an undemocratic document, in that it makes it difficult to take away fundamental liberties and spend other people’s money. Without the Constitution, and the Bill of Rights in particular, as restraints on the passions of the majority at the moment, Americans would have long since lost many of their freedoms, including free speech, a free press, freedom of religion, freedom of assembly, the right to bear arms and others.

Though it is widely recognized that Congress has become unwilling to restrain the growth in spending and that this lack of restraint will only result in increasing economic misery and the loss of opportunity, too little is likely to be done, and too late. In order to deal with what most thinking people understand is a fundamental problem, many different forms of constitutional amendments to limit spending, taxes and deficits have been proposed. Most of these well-intentioned proposals limit increases in government spending on some basis, or deficits or taxes. Many include economic terms such as a percentage of gross domestic product (GDP). (Note: terms like GDP can be redefined easily. The French are even considering including “happiness” as part of GDP, which would make the measurement meaningless.) As one who has spent years looking at such proposals and being involved in the effort to find a constitutional restraint, I have concluded that the simplest approach might be best — more on that below.

Trying to define the appropriate level of government spending, taxing and deficits for the future is nearly impossible and even really a bit arrogant. I am a small-government type, but if the vast majority really wants more government spending and taxing than I prefer, it is my job to persuade them to my view but not deny them the opportunity to do as they wish.

The overwhelming evidence is that in the aggregate, Americans are subject to more government than they wish. So what is the most straightforward way to achieve their stated desires? The answer is to make it more difficult for the political class to spend and tax as much as it does but not make it so restrictive that government cannot spend sufficient funds on what is generally believed to be a constitutional and appropriate function of government. This can be accomplished best by having a constitutional amendment that requires both houses of Congress to pass all tax and spending bills with a supermajority — two-thirds of each chamber might be appropriate.

There already are many supermajority requirements, such as overrides of vetoes, so no new ground is being broken. In practice, what this would mean is that the special interests who want more spending or taxing will have a more difficult time rounding up the required numbers of votes, which means they will fail more often — all to the good. The supermajority requirement is not a panacea but will make it easier to reduce excessive spending and destructive deficits.

Richard W. Rahn is a senior fellow at the Cato Institute and chairman of the Institute for Global Economic Growth.