Honest Finances Amendment
A proposed amendment to the US Constitution that promotes transparency and prudence in the management of our national finances.
We propose that all claims on the federal purse must be presented for public view in the annual budget exercise and funded by budget appropriations, without exception:
All planned cash expenditures and subsidy grants shall be listed in the budget, which Congress shall present to the president thirty (30) days before the start of the federal fiscal year; it shall provide projections of ten (10) years, with the first two (2) years in traditional detail.
All employee retirement plans of the government of the United States, all insurance-type programs of this government, and all commitments of future expenditures shall be operated on an actuarially sound basis and shall be fully funded in the budget in accordance with best accounting practices, similar to those required of private corporations.
Targeted individual and corporate income tax credits and deductions shall be reauthorized annually in the federal budget. Targeted credits and deductions are those that benefit only special interests and are not freely available to members of the general public. This will force Congress to review and prioritize these subsidies annually with all federal expenditures, which is the proper forum for evaluating them.
Because a functioning budget is critical to most of the work of the federal government, if Congress fails to fulfill its constitutional responsibility to deliver a timely budget to the president, or the president vetoes the budget submitted, during the coming fiscal year an automatic continuing resolution shall fund federal activities at the aggregate total of five percent (5%) less than the total of the previous year, and shall be continued (until resolved) with annual reductions of the same amount.
Arguments in Support of this Amendment
For decades, we have been promising generous future retirement benefits to public employees and operating the Social Security, Medicare, and Medicaid programs without regard for the solvency of the country. However, our moment of reckoning is fast approaching: the federal government has accumulated off-budget unfunded liabilities estimated at more than $100 trillion, and we have no hope of having the resources to satisfy these obligations as they come due. Federal officials of both major parties have repeatedly refused to acknowledge and resolve this huge financial burden, leaving it to our children and future generations to cope with.
This has been called the greatest intergenerational wealth transfer in the history of the world, and it is perhaps the greatest failing of our democratic republic.
Congress uses another sleight-of-hand to grant financial favors to groups without funding them in the budget: it grants subsidies as credits and deductions under the tax code. This allows Congress to dispense favors without prioritizing them with the many other issues competing for federal funding.
Profligate spending is the Achilles heel of a democracy, and we must compel a much-needed focus on our national financial capabilities and priorities. The process of setting priorities is one of the most difficult tasks of government, but it is a key to effective governance.
To do it successfully, all requests for benefits from the government must be submitted to the discipline (and transparency) of the annual budget.
Author: Frank Keeney
Revised November 1, 2022
Socialism or Freedom
The last 200 years have given us a ring-side seat at the workings of a number of different government forms. When we evaluate them, we do not need to rely on theory; we can observe the actual positive and negative results.