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    Letter to the House Opposing the Balanced Budget Amendment to the Constitution

    July 29, 2011

    United States House of Representatives
    Washington , DC 20515

    Dear Representative:

    On behalf of the millions of members and supporters of the National Committee to Preserve Social Security and Medicare, I am writing to express our strong opposition to H.J.Res. 2, which would establish a balanced budget amendment to the Constitution. Although H.J.Res. 2 is being touted as the "plain" balanced budget amendment in comparison to H.J.Res. 1, it would have the same devastating consequences for Social Security, in particular, as well as for the economy and vital programs generally.  H.J.Res. 2, like its counterpart, would negatively impact Social Security by essentially nullifying the trust funds as a source of funding for the payment of benefits.

    The balanced budget amendment's requirement that spending in any year be offset by revenues collected in the same year would create serious problems for Social Security by preventing it from using the reserves in its trust funds to pay benefits. Under a balanced budget amendment, the budget would be considered to be balanced in a year only when total spending for that year, including Social Security benefit payments, and total revenues for that year, from all sources, were equal. Under such an arrangement, trust fund surpluses, which almost exclusively represent tax payments from prior years, could not be used to pay benefits unless the surplus used from the trust funds were validated by receipt of offsetting revenues from other sources. Since this seems to be a highly unlikely scenario, the only remaining option under a balanced budget amendment would be immediate and potential massive cuts in benefits for millions of Americans.

    Keep in mind that while current budget rules treat the self-financing Social Security program as "off-budget," and Social Security has been exempted from past budget enforcement rules, these statutory rules would be superseded by the language of a constitutional amendment. Again, the National Committee urges you to reject H.J.Res. 2.

    Sincerely,

    Max Richtman
    President & CEO