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Is the federal government an enterprise that must balance its budget?

Is the federal government an enterprise that must balance its budget? Topic: We must do our homework
June 16, 2019 / By Gabi
Question: Is the federal government an enterprise that must balance its budget? Or is it rather a sovereign state that: 1. has the Constitutional obligation to finance infrastructure “…to promote the general Welfare and secure the Blessings of Liberty to ourselves and to our Posterity”; 2. will have the world’s soundest currency when it has the world’s best infrastructure; 3. issues fiat currency; 4. can never become insolvent; 5. can (by change of law) create money instead of borrowing and paying interest; 6. is able to spend enough to bring full employment; 7. is able to stop spending when full employment appears; and 8. is able to raise interest rates to prevent harmful inflation? dasher: You forgot to relate supply of money to supply of goods (GDP), which increases with supply of money. A little more homework? The only way for government to promote the general welfare is through infrastructure, which includes defense, justice system, etc. Do you have another way? L.G: No. 3 is what makes us better than Europe. Both US and Europe need a combined Fed and Treasury. Can't live without a central bank. Public debt is outstanding bonds. We should retire the ones with high interest. Treasury bonds are needed to cover trade deficits but they should have a slightly negative real (inflation-adjusted) interest rate.
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Daryl Daryl | 6 days ago
The Republicans prefer to put the tax burden on the people. Romney has suggested a regressive tax structure I agree. with 1 and 2. Three scares me because of the freedom the Federal Reserve has from the government. The Wall Street Banks have way too much latitude with what they can do with bad debt. We could actually become insolvent as a nation if they are not reigned in and regulated properly. I agree with 5 and would take it one step further by saying the Wall Street Banks should write off our Public Debt owed to them and then we could have a fighting chance of paying off the remaining 4 trillion. I agree with 6 and 7 and would take it a step further to raise tariffs on imports and tax the hell out of American Companies operating offshore and give them credits for keeping their businesses here. I agree with 8 because this no interest is what is killing the banks. Thanks for the great question framework so I could express myself adequately
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Daryl Originally Answered: Is a law requiring a balanced federal budget unconstitutional?
How would it be unconstitutional if it is a CONSTITUTIONAL amendment? Now, if your question is does it conflict with section 4 of the 14th, the answer is no. Why would it be in conflict? It forces the federal government to spend less. That does not breach contractural obligations or default on our debt. It MAY rein in some UNCONSTITUTIONAL programs. It certainly would rein in some waste....like spending a half million dollars to watch a shrimp on a treadmill...but it would not cause any conflict with the 14th. However, NOT balancing the budget guarantees that at some point we would be forced to default as there is NOT enough money to continue to pay rising interest forever. Luka...raising taxes does NOT equate to more tax dollars...it costs jobs and lowers tax revenues in the long run. But let's PRETEND that they could raise taxes enough to balance the budget and it would not crush the economy. Do you realize what tax rates we would have to see across the board to balance the budget...all the way down to poverty level would have to be taxed at almost 90%...So NO we could NOT raise taxes to balance the budget. We do not have a revenue problem. We have ONE HELL OF A SPENDING PROBLEM. ADDED: Defense spending in the time of war would OF COURSE be exempted from the balanced budget. But the reality is that our government is INCREDIBLY bloated. There are more unconstitutional federal agencies than there are constitutional ones. If we merely did away with all federal agencies that are not within the Constitutional restraints of the federal government, we would balance the budget and then some overnight. Your CA scenario did make me laugh. Borrowing is the right of the AMERICAN PEOPLE. Fine, bring it to a vote OF THE PEOPLE when the government wants to borrow. See, I can see the usefulness of borrowing in certain instances, I have built and sold 19 businesses and still own 6. I did not do that without borrowing. But whenever possible, I do not use credit. For over 15 years, if there is a net 10 or net 15 or net 30 term where I pay no interest, the bill is paid with no interest. The ONLY time that borrowing makes sense is when the return outweighs the interest. THIS IS NOT THE CASE WITH OUR GOVERNMENT. Our government is arguably the most inefficient body on the planet. WE MUST REIN IT IN. brown950...yes, we in the TEA Party love the Constitution. We love the fact that the founders gave the ONE AND ONLY WAY TO AMEND IT, too. They understood the need to change over time, they also understood the need to make those changes VERY difficult in order to preserve the Constitution. If only liberals and activist judges understood that if you do not like the Constitution, you do not ignore it, you amend it. SteveG...put down the koolaid and slowly back away. Perhaps get a copy of the Paul Ryan plan and READ IT. It did NOT do away with Medicare. That is false propaganda by the left.
Daryl Originally Answered: Is a law requiring a balanced federal budget unconstitutional?
Of course it is which is exactly why to add a balanced budget provision requires an amendment to the Constitution. A simple law being passed would not work. And to add an amendment to the Constitution requires it to pass a 2/3s vote in the House, a 2/3s vote in the Senate, and then would require 3/4s of all the states to ratify it.

Breeda Breeda
I think you need to do a little more homework. Particularly with #5. Simply printing money doesn't do anything except decrease the value of the money. Money is no different than any other commodity in that supply and demand determine its value. Increasing the supply, drives the value downward. The government has an obligation to "promote the general welfare", but it is not constitutionally obligated to do so through infrastructure.
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Alexandra Alexandra
If you want to see Democrats completely implode on themselves all one has to do is introduce a balanced budget amendment. Scatters them like roaches.
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Alexandra Originally Answered: I'm supposed to write a paper about the Federal budget for Political Science?
This is a simple question yet people make it somehow related to republican vs democrat haha, its not. Heres what I understand is the general idea of what happens so you can start and have some idea to develop on. Congress basically is responsible for making the budget. first.. Its a committee which is composed of people in congress. when they are done with their budget, they bring it to the president. The president then basically goes over this budget and just crosses out whatever he wants. The government basically raises the money it needs0if the income from taxes is not enough (which is rarely is) by selling government bonds its sort of like selling stock in a corporation except its the US government instead of a corporation. China loves to buy these bonds.

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