Compact for America would quell tax increase concerns

Most Americans don’t relish the thought of our children and grandchildren paying down the out-of-control federal debt over the next several decades. But with a national debt level now approaching $17 trillion, Americans must face up to the fact that Washington won’t fix itself: The best hope for fixing the spiraling federal bill is using the constitutional powers of the states.

In a policy report released this week, Goldwater Institute Director of Policy Development Nick Dranias proposes the Compact for America, an interstate compact concept to advance a balanced budget amendment through state legislatures. If approved by 38 states, the Compact would require the federal government to obtain the approval of the majority of legislatures to green light any increase above an initial debt limit. In other words, 26 states would have to cosign for the federal government’s credit card.

“While there are many balanced budget amendment proposals out there, the Compact for America has the best chances for passage,” said Dranias. “It will cut the time and resources needed for successfully advancing this much-needed reform by more than half, making a powerful balanced budget amendment possible for the first time.”

The Compact doesn’t wait around on Washington to initiate balanced budget amendment. Instead it establishes an agreement among the states to use the powers granted to them by Article V of the U.S. Constitution. The Founders established Article V to provide a failsafe to the states in the event that Washington overstepped its bounds. The provision allows states to originate constitutional amendments by applying for a convention to propose amendments. Unlike merely seeking to hold a constitutional convention, the Compact consolidates both the convention application and the content of the proposed balanced budget amendment itself, which would speed up the process significantly.

This feature of the Compact should reassure traditional opponents of Article V conventions, who have previously feared the prospect of a runaway constitutional convention. Under the Compact the convention cannot proceed unless the agenda is limited to a balanced budget amendment. As written, the compact bars any member state from ratifying any convention proposal other than the balanced budget amendment it specifies.

Once passed, the Compact would also quell fears of across-the-board tax increases to meet new revenue demands by requiring any new income or sales tax to secure two-thirds approval of both houses of Congress.

“The Founders enabled the states to rein in a runaway federal government through mechanisms like the Compact for America,” said Dranias. “This is our country’s best chance at achieving the critical protection of a balanced budget amendment.”


  1. A balanced budget amendment is like putting handcuffs on ourselves. If we cannot trust ourselves to use deficit spending wisely, we should just stop being a democracy – not hobble our democratic process utterly.

    There are plenty of good and rational reasons why the Federal government might wisely use deficit spending – another world war (try financing the defeat of two world powers with current receipts), another Cold War (try financing a global military build up with current receipts only), and, of course, counter-cyclical stimulus spending to get us out of another depression or recession. Those who advocate for such an absolutely short-sighted policy want only one thing – the destruction of democratic control over America’s finances. Don’t be fooled: only the ultra-wealthy would benefit from a financially hobbled American Federal government.

    • Michael Bryan how do you propose controlling a runaway irresponsible government that is spending and borrowing this country into oblivion?

      Perhaps you believe in a citizenry of ostriches.

      The government has not demonstrated that they can be trusted “to use deficit spending wisely”.

  2. Go for it Arizona. It’s the only way we have of reining in the tyranny of the Fed’s. Since Flake has become best buddies with McCain he has turned into milquetoast. Politicians who have been in DC long enough to get all the benefits of retirement think taxpayers are here to support them. We can only drool at what the elitist in governments have upon leaving office. The laws need to be changed so they are citizen representatives of the people. No longer parasites sucking the people dry.

  3. And why does Spendator McCain not support something like this? How about our newest Spendator Flake.

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