If spending were kept to 20 percent of GDP, the deficit would fall below its historical average after 2018 and the national debt would stabilize. Capping spending by the President and Congress to a specific percentage of economic output would cap the growth of government.
Federal tax revenues have averaged about 18 percent of GDP. Mike Lee’s (R-UT) version introduced in February as S. Once amended, the Constitution would contain a provision that would force a supermajority in both chambers to raise taxes on the American people in order to balance the budget, with certain exemptions in one version.
Although below that mark currently because of the recession, according to the Congressional Budget Office (CBO), federal tax receipts will be above that historical threshold by 2018 if all current tax policies are left in place—including making all 20 tax cuts permanent. Also, House and Senate versions contain a spending cap on the growth of government at 18% of the output of the economy.
Passing a weakened version of the BBA without capping the size of government nor prohibiting tax increases would be an example of House Republicans negotiating against themselves.
Conservatives may have a good reason to oppose the weakened version of a BBA.
As I indicated in my earlier testimony and statements, the primary concern of the Department of Justice is that the proposed amendments fail to address the critical question of how they will be enforced.