Washington D.C.--Ability as a legislator and expertise on the subject of budgeting prompted U.S. Senate leadership to give Senator Mike Enzi (R-Wyo), the lead in today's floor debate concerning the Feinstein Amendment, a proposal to change the Balanced Budget Constitutional Amendment (BBCA) bill.
The Feinstein Amendment, offered by Senator Dianne Feinstein (D-Calif.) would have permitted the creation of capital budgets and would have excluded Social Security outlays and receipts from the BBCA after fiscal year 2002, among other items. The Feinstein Amendment was tabled (defeated) this morning on a vote of 67-33.
Enzi argued against the Feinstein amendment because of the "loopholes" the amendment would create in the BBCA.
"You can build an interstate through it," said Enzi. "The Feinstein Amendment actually harms the Balanced Budget Constitutional Amendment because it ultimately will increase debt. It's a license to increase debt. This amendment to the Balanced Budget Constitutional Amendment doesn't tell us how we will pay back the bonds for capital spending. Capital budgeting could be a great idea, but not if the purpose is to build loopholes so we can spend whatever we want merely by putting it in the capital budget . It's more and more debt."
Enzi likened the Feinstein Amendment concept of capital budgeting to a homeowner only paying the interest on their home loan.
"Are you paying off the mortgage or are you just paying the interest? And can you buy two or three or five houses and only pay the interest," Enzi asked. "That is what we are trying to do with capital budgeting with the federal government. We are saying we don't have to pay back the principal; interest is the only thing that is important. We are talking about the possibility of telling our kids or our grand kids, 'You have to pay 84 percent of your wages in taxes and you will get nothing for it because you are going to be paying the interest on the houses that we bought and used up.' At that point we would have a revolution in this country."
Enzi also argued that the only way to protect Social Security is to keep it in the budget.
"If we are going to save Social Security, we are going to have to do adequate budgeting to build it up to some point in time where it is actuarially sound. There isn't a single person in this body who does not want to protect Social Security, but how long are we going to wait? If we don't begin balancing budgets there won't be social security," he said.
Enzi said the federal government should use cash flow budgeting to arrive at a true balanced budget. He used the example of the time when he was a small town mayor in Wyoming to illustrate his point.
"We did cash flow budgeting then and because of the leaders who followed and follow that process now, Gillette, Wyoming is one the few places in the United States that is debt free. That is how you run a city. That is how you should run a state, and most states do because they are required to by their own constitutions. This forces them to live within their means and that is how the United States ought to work," said Enzi. "We were elected to make budgeting decisions within certain constraints. The people back home tell me that they expect that constraint to be paying things off. They expect us not only to balance the budget, but to get to a situation, to plan for a situation where we pay down the national debt. That is good budgeting; that is good accounting."