The Balanced Budget Amendment is a bad policy response to the 2011 debt issue.

Pro 1: When the debate over raising the debt ceiling began, there was a certain range of policy options that were reviewed. As the August 2nd deadline approached, each side had to choose the policy tools they would implement in the plans they would present to congress.One way to go about this would be to create a plan which has absolutely no way of passing but will please constituents. For instance, a Democrat in the House might propose all cuts come from our military, much to the delight of his pacifist constituency. However, the Democrat is quite aware that even if he could garner the House, it would be impossible to pass legislation through the Senate. This time-wasting move accomplishes nothing other than running out the clock and grandstanding.The Balanced Budget Amendment would require a vote passing a balanced budget amendment that goes to the states. Since day 1, House conservatives and tea party members knew this was a non-starter. Yet this group brought the BBA up to the table and drew a line in the sand. That kind of brinksmanship is bad policy. It shows a willingness to destroy America for the sake of some local constituency points.Pro 2: State capital expenditures make up huge policy projects like building highways (by no means toll-operated), infrastructure facilities that are involved in long-term assets, and many other costly gaps in the budgeting process. This is far from laundering a little pork barrel spending into an operating budget. Con is wrong in suggesting that we can make such a simplistic comparison.Con's BBA would lead to a massive shift in policy-making power from our legislative to our judicial arena. This would be the perfect spawning point for “activist judges” looking to apply their economic beliefs to national budgets.We elect legislators to handle appropriation. Legislation concerning the budget should involve shaping legislative enforcement, not judicial enforcement. Shifting that to the judicial branch alters the balance of powers in both foreseeable and unforseeable ways. And when the judicial branch decides to cut program A or program B, there will be no constitutional remedy. Legislators will have to start from scratch.Pro 3: We now face a system where congressmen actively support America defaulting, and that's just the far extremists. Others are willing to let our system default in order to obtain a far-reaching policy gain like “no tax increases for anyone whatsoever.” As many have noted, we are in a system where holding the economy hostage has so far paid off. There are both Democrats and Republicans in this group.Obama fought tooth and bone to get the stimulus passed, and that was at the PEAK of his political capital. If the BBA were in place, every year the democrats would have to re-argue and re-vote when it inevitably turns out revenues and expenditures are different from expectations.With a BBA, any attempt at a protracted response to a recession will be inviting a barrage of political maneuvering by re-calculating and re-balancing the budget every year.Pro 4: Con's explanation of recessions entirely leaves out the over-leveraging, derivative trading, and shadow banking systems that lead to hundreds of trillions of dollars blowing up in our faces. TARP was to fix derivatives, not the housing market.Bubbles are caused by many, many factors. Bubbles pop for even more reasons. Countries that have LOW public debt have still experienced deep recessions. Con wishes to incur a federal “rainy day fund” to explain any sort of problem the BBA may face down the road. Not only does the BBA lack any enforcement for creating a rainy day fund, but even with the most hopeful prospects, America won't face a surplus so large as to not only overturn our debt but ALSO create an invulnerable fund to counter any fiscal difficulty. Many states have rainy day funds, but we have already discussed the problem with that comparison.Automatic stabilizers have been shown in cross country studies to cushion shocks to a nation's GDP [1]. The IMF study of 49 industrial countries compared policy responses by divvying them up as automatic stabilizers, fiscal stabilization unrelated to automatic stabilizers, and fiscal policy volatitlity unrelated to stabilization.Exclusive reliance on automatic stabilizers is bad, but their ability to produce consistent and timely results allows it to address economic fluctuations in ways that non-automatic monetary policy cannot accomplish. As GDP falls from potential GDP, automatic reductions in revenue and increases in spending lead to temporary budget deficit depending on the scale of the recession. This CBO report is an example of how auto-stabilizers will increase and decrease deficit over time in consistent manner. [2].If Con has an infinite rainy day fund, then it is hard to imagine any problem here. However, in reality, when we end up in a recession, we'll have balanced budgets that don't include estimates for automatic stabilizers. The effectiveness of these stabilizers end if their implementation must be already accounted for in the yearly budget. Even if Congress passed the stabilizer every time they voted, it still would lack the timely effect that makes it so important.That's why the major economists are all so terrified of the effects of a BBA on a recession. Even with an infinite rainy day fund to blunt the imagination, it's quite easy to see why the BBA is so destructive.Again, even with a rainy day fund Congress votes on, the BBA destroys all effectiveness of automatic temporary deficit increases by forcing them into time-delayed votes.Pro 5: Pro was clarifying that he never argued for a constitutional line-item veto. The line-item veto mechanism suggested by CATO does not need a constitutional amendment.Con is sure that we are “200 years past Hamilton's solution” even though the BBA as a solution has never been brought up on a national level. “Hamilton's solution” was not made in a friendly environment. Several founders and many more politicians were adamantly opposed plans to lower the war debt through credit extensions. As is it, Con's position seems to be that because we can trust neither congress nor the president, we ought to trust the appointed judges such as Sonia Sotomayor with our budget. Con 2: See point 1.Note: I would again like to thank Roy for sticking with me through my first debate. He has been quite generous throughout and has made this a very pleasant experience.[1] http://www.imf.org... [2] http://www.cbo.gov...