White House Blasts Budget Amendment But Adminstration Says It Faces Uphill Fight To Defeat Proposal

Conceding an uphill fight, the Clinton administration opened its 1997 campaign to derail a balanced budget amendment while supporters used a bagful of bills and a debt clock to make their points.

Treasury Secretary Robert Rubin warned the Senate Judiciary Committee on Friday that putting a balanced budget requirement into the Constitution would subject the country to unacceptable risks by making it impossible for the government to respond quickly when the economy begins to weaken.

Rubin said the current system cushions the shock of downturns by allowing government spending to increase automatically for such things as unemployment compensation and welfare benefits, even though that results in a higher deficit during periods of economic weakness.

If a constitutional amendment had been in effect during the last recession from 1990-91, Rubin said the unemployment rate would have hit 9 percent instead of 7.7 percent, a loss of more than 1 million more jobs.

But Sen. Orrin Hatch, R-Utah and chairman of the committee, said Congress had been unable since 1969 to produce a single balanced budget and would go on doing so without the constitutional requirement to do so.

Pointing to a red digital clock ticking off changes in the $5.3 trillion national debt, Hatch said, “Every three seconds the debt increases by more than $13,000. This translates into more than $268,000 every minute, more than $16 million every hour and more than $386 million every day.”

To demonstrate what $13,000 looked like, Hatch dumped that amount in front of the committee table.

Rubin told the committee that President Clinton and Congress had come very close to agreement on a plan to balance the budget by 2002 last year and should work toward that goal this year, rather than wasting time discussing the amendment.

“Politically, historically and economically, the forces are in place to balance the budget. We are not far apart,” Rubin said.

Rubin’s testimony marked the administration’s opening salvo in a campaign to defeat the constitutional amendment, but he acknowledged to reporters afterwards that the administration faced an uphill fight.

“Having said it is uphill, I believe the outcome is still uncertain and we are going to do everything we can to prevent the adoption,” he said.