Back Regla del dèficit zero Catalan Schuldenbremse German Regla de oro presupuestaria Spanish Defizitaren muga konstituzional Basque Velkajarru Finnish Règle d'or budgétaire French Pareggio di bilancio Italian Paregg de bilancc LMO Balanced budget amendment SIMPLE
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A balanced budget amendment or debt brake is a constitutional rule requiring that a state cannot spend more than its income. It requires a balance between the projected receipts and expenditures of the government, and the balance requirement may be for each fiscal year or over a multi-year period.
Balanced-budget provisions have been added to the constitutions of Germany, Hong Kong, Italy, Poland, Slovenia, Spain and Switzerland, among others,[1] as well as to the constitutions of most U.S. states.[2] In the United States, proposals for balanced budget amendments to the United States Constitution have often had bipartisan support but have become more associated with the Republican Party in the 21st Century.[3]
Balanced budget amendments are defended with arguments that they reduce deficit spending and constrain politicians from making irresponsible short-term spending decisions when they are in office.[4] Research shows that balanced budget amendments lead to greater fiscal discipline.[5] However, there is substantial agreement among economists that strict annual balanced budget amendments have harmful[vague] near-term economic effects. In times of recession, deficit spending has significant benefits, whereas spending cuts by governments aggravate and lengthen recessions.[6][7][8][9][10][11] To prevent that, most balanced-budget provisions make an exception for times of war, national emergency, or recession, or allow the legislature to suspend the rule by a supermajority vote. In 1995, such an amendment passed the US House and came within one vote of passing the Senate.[12]
Alternatively, some balanced budget requirements and proposals target multi-year balance instead of annual balance.[13][14][15] Structural balance—balance over the medium term—avoids the pro-cyclical features of an annual balance requirement and may allow adjustments for automatic changes in benefits programs known as automatic stabilizers.[16]
- ^ International Monetary Fund Fiscal Affairs Department, "Fiscal Rules Dataset, 1985 - 2021," https://www.imf.org/external/datamapper/fiscalrules/matrix/matrix.htm, January 2021
- ^ National Association of State Budget Officers, Budget Processes in the States, https://www.nasbo.org/reports-data/budget-processes-in-the-states, 2021, Table 9: Balanced Operating Budget Requirements, p. 61
- ^ Balanced Budget Amendment proposals in the U.S. House of Representatives, 1973-2025, Congress.gov, https://www.congress.gov/search?pageSort=dateOfIntroduction%3Adesc&q=%7B%22source%22%3A%22legislation%22%2C%22type%22%3A%22joint-resolutions%22%2C%22subject%22%3A%22Economics+and+Public+Finance%22%2C%22house-committee%22%3A%22Judiciary%22%7D, retrieved July 26, 2025
- ^ Alesina, Alberto; Passalacqua, Andrea (2015). "The Political Economy of Government Debt". Cambridge, MA. doi:10.3386/w21821.
{{cite journal}}: Cite journal requires|journal=(help) - ^ Amick, Joe; Chapman, Terrence; Elkins, Zachary (2019). "On Constitutionalizing a Balanced Budget". The Journal of Politics. 82 (3): 1078–1096. doi:10.1086/707618. ISSN 0022-3816. S2CID 213008796.
- ^ "www.igmchicago.org/surveys/balanced-budget-amendment". www.igmchicago.org. Retrieved November 22, 2017.
- ^ Hoover, Kenneth R. (2008). Economics as Ideology. Lanham, Maryland: Rowman & Littlefield. ISBN 978-0-7425-3113-0.
- ^ Skidelsky, Robert (2003). John Maynard Keynes, 1883–1946: Economist, Philosopher, Statesman. Pan MacMillan Ltd. ISBN 978-0-330-48867-9.
- ^ "Nobel Laureates and Leading Economists Oppose Constitutional Balanced Budget Amendment" (Press release). Center on Budget and Policy Priorities. July 28, 2011. Retrieved November 19, 2011.
- ^ Rossana, Robert J. (2011). Macroeconomics. Routledge. p. 173. ISBN 978-0-415-77949-4. OCLC 1058081832.
- ^ "Economists Oppose a Strict Balanced Budget Rule. Could the US Adopt a Sophisticated One?". Cato Institute. November 13, 2017. Retrieved May 17, 2020.
- ^ https://www.congress.gov/bill/104th-congress/house-joint-resolution/1#:~:text=Passed%20House%20amended%20(01/26,joint%20resolution%20which%20becomes%20law. [bare URL]
- ^ Federal Department of Finance, "Debt Brake," Swiss Confederation, https://www.efd.admin.ch/en/the-debt-brake, retrieved July 26, 2025
- ^ Rep. Justin Amash, H.J.Res.81 (112th Congress), Proposing a balanced budget amendment to the Constitution of the United States, https://www.congress.gov/bill/112th-congress/house-joint-resolution/81, introduced July 21, 2011.
- ^ Rep. Dave Brat, H.J.Res.55, (114th Congress), Proposing a balanced budget amendment to the Constitution of the United States, https://www.congress.gov/bill/114th-congress/house-joint-resolution/55, introduced May 20, 2015
- ^ U.S. Government Accountability Office, "Economic Downturns: Considerations for an Effective Automatic Fiscal Response," GAO-25-106455, https://www.gao.gov/products/gao-25-106455, June 9, 2025.