Before the Senate took up its vote on a radical Balanced Budget Amendment proposal today, Utah Sen. Mike Lee (R) — a co-sponsor of the bill — called it “one of the most important pieces of legislation to come before the Senate in decades.” Lee is right: the Balanced Budget Amendment he and his Republican colleagues continue to push is important, since it would have tremendous ramifications for an already-struggling American economy, throwing the country back into the depths of recession.
Fortunately, the amendment failed to garner enough votes to advance, falling 47-53 along party lines. But as Republicans continue to talk about the importance of job creation and economic recovery, their repeated efforts to institute cockamamie economic policies like the Balanced Budget Amendment prove that such talk is only lip-service.
As ThinkProgress has reported since the push for such an amendment began earlier this year, the GOP’s Balanced Budget Amendment would have huge consequences for the economy. If it had been in effect this year, it would have pushed 15 million people out of work and doubled the unemployment rate, as Macroeconomic Advisers and the Center on Budget and Policy Priorities made clear last month:
If the 2012 budget were balanced through spending cuts, those cuts would total about $1.5 trillion in 2012 alone, the analysis estimates. Those cuts would throw about 15 million more people out of work, double the unemployment rate from 9 percent to approximately 18 percent, and cause the economy to shrink by about 17 percent instead of growing by an expected 2 percent.
The Republican version of the amendment would have capped spending at 18 percent of GDP and required a three-fifths majority in the Senate to raise taxes, thus requiring the budget to be balanced through drastic spending cuts that touched every federal program.
The Macroeconomic Advisers study found that the spending reductions caused by such an amendment would force deep cuts in Medicare, Medicaid, Social Security, and the Children’s Health Insurance Program, findings that have been backed up by other studies as well. The Center for American Progress’ Michael Ettlinger and Michael Linden, for instance, found that such an amendment would require 25 percent cuts in every government program, from the Pentagon to Social Security to education. CBPP, likewise, found that the Senate version would require 25 percent cuts across the board.
Republicans can continue to claim they are the party that cares about protecting Social Security and Medicare. But by pushing so hard, so often for a radical amendment that analysts on both sides of the aisle have called the “worst idea in Washington,” the GOP’s policies will only exacerbate the effects of the last recession while ensuring that future recessions will be even worse.