Note From the Publisher

Balancing Acts

By From the October 2011 issue

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"TAX and tax, spend and spend, elect and elect," Harry Hopkins, FDR's most trusted adviser, allegedly told Arthur Krock, veteran columnist for the New York Times. Lest we forget, Hopkins lived in the family quarters at the White House and, according to files found inside the Kremlin after the fall of the Workers' Paradise, was a Communist spy. But that aside, he also understood politics, he understood what the people wanted from the government, and he understood what the Roosevelt administration needed to do to stay in power.

Hopkins later denied the quip was his, but it has become part of the conversation and whether he said it or not, it is right on point. Politicians live -- and get reelected -- by taxing and spending other people's money. Sadly, it is not just the Democrats who are the culprits -- the national debt nearly doubled during the George W. Bush administration and his go-along GOP Congress, and has doubled again in the last two and three quarters years under you-know-who.

Steve Moore, a regular TAS contributor and member of the Wall Street Journal editorial board, gives us a quick tutorial this month on just what a mess the tax-spend-elect mentality has made of the federal treasury, all under the guise of Keynesianism. Lord Keynes may not have thought about the "elect" part of Hopkins' equation, and it would stretch credibility to think that liberal academics and economists could imagine taxing and spending serving anything but the greater good. But the only "greater good" most politicians are interested in is their own careers. Moore hits the nail on the head when he quotes George Mason University economist Don Boudreaux, "When you get right down to it, Keynesianism is just a convenient excuse for what the left wants to do anyway: spend more government money."

Truer words were never spoken. Spending is the politicians' disease, and they willingly accommodate constituents' and lobbyists' demands for bigger programs, special favors, earmarks and the rest. And every politician -- at least those who have been around for more than a term or two -- has his favorite expenditures and will go to the mat to assure they survive. I’ve always thought the best example of this was deficit hawk and conservative stalwart Jesse Helms, who spent his 30-year career in the Senate fighting off every conceivable sort of special interest -- except the tobacco lobby. As they used to sing about Jesse, "As long as tobacco subsidies hold firm, he'll get reelected every term." Multiply that times 535 members of Congress and you'll get an idea what we are up against.

So what to do? Devise a mechanism to stop unlimited spending and call it an amendment to the Constitution requiring the government to balance its books by matching spending to revenue -- a Balanced Budget Amendment. Constitutions in 49 of the 50 states require governors to balance their books in one form or other (Vermont being the odd man out). Opinion polls indicate that 75 percent of Americans favor the idea, and although the leadership resisted it, the recent debt ceiling debate resulted in a compromise, thanks largely to the Republican freshmen, requiring both houses of Congress to have a vote on such an amendment before the end of this year.

Steve Calabresi, law professor at Northwestern and chairman of the Federalist Society -- and a new contributor to TAS -- explains why a balanced budget amendment would be wise, why one would fit within the Constitution, what the shortcomings are, and how to get around them.

Although the Republican House of Representatives is likely to pass a balanced budget amendment, it is virtually certain the Democrat-controlled Senate will vote it down. If so, all who voted against it will have to answer on Election Day, 2012.

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About the Author

Alfred S. Regnery is a former publisher of The American Spectator. He is the former president and publisher of Regnery Publishing, Inc., which produced twenty-two New York Times bestsellers during his tenure. Regnery also served in the Justice Department during the Reagan Administration, worked on the U.S. Senate staff, and has been in private law practice.  He currently serves on several corporate and non-profit boards, and is the Chairman of the Intercollegiate Studies Institute .