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IIIMIOpinion11111111
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The Michigan Daily
Vol. XCII, No. 60-S
Ninety-two Years 01 Editorial Freedom
Edited and managed by students
at the University of Michigan
A slapfor sense
GREAT BRITAIN became the fourt
European nation last week to reject th
Reagan administration's embargo of America
technology for the Soviet gas pipelinet
Western Europe. Finally, someone in Congre
is trying to undo the damage that embargo he
wrought in allied relations.
In what one loyal Republican termed a "sla
in the face of the President of the Unite
States," the House Foreign Affairs Committ
voted to repeal the embargo.
If the vote was a slap at the president, thens
be it. Perhaps the president needed such a sla
to make him realize that rigid, but useles
ideological principles are no substitute for
pragmatic foreign policy.
From the start, the embargo was doomedt
failure. It was meant to wrangle concession
from the Soviets on Polish martial law an
delay the project, thus starving the Soviets4
needed hard currency. So far, it has failed on a
counts.
The embargo has not failed, however,1
severely damage U.S. relations with our alli(
in Western Europe, who are ignoring the en
bargo anyway. And with his extension of U.
grain sales to the Soviet Union, the preside
showed his supposed lofty principles can easi
be swept away when U.S. economic interes
are threatened.
If both houses of Congress concur with tf
committee and repeal the embargo, th
president will surely protest the "crippling"
his foreign policy. But since this policy serv(
only to rankle U.S. allies, Congress shou
move to correct the president where. he hc
most obviously been wrong.
Thursday, August 12, 1982
The Michigan Daily
Only a
U.S. to
By Mark Gindin
Things are getting a little silly.
Although that statement could
apply to almost every aspect of
h life in Washington, D.C., the
e recent discussions on the balan-
n ced budget amendment deserve
inmore ridicule than others.
to Actually, such an amendment
SS is a long-overdue necessity.,
as From the inane arguments
against the proposal, however,
p onegets the idea that any sort of
fiscal responsibility by our
d nation's leaders is not only un-
ee necessary, but merely a political
ploy to obtain votes.
so MAYBE putting the trend of
p the federal budget into historical
~Pperspective will help focus on the
s, issue alone. John Kennedy's 1962
a budget was the first one to reach
$100 billion. In 1978, Jimmy Car-
to ter proposed a federal budget of
C $500 billion, and described it as
1s "lean and tight."
id To put the size of Carter's
of budget into perspective, to spend
ill $500 billion in one year would
require spending $951,000 every
to minute of the year, $57 million
per hour, or $1.37 billion each day
es of the year, with no time off.
n- In 1981, the federal budget was
S. more than $650 million. The
nt deficit was more than $50 billion,
1y or half of the entire federal
budget in 1962. And this year,
ts there is talk of a $140 billion
deficit. The trend does not look
he good.
e THE ENORMOUS burden of
of the federal budget and the huge
deficits have noticeably
eS detrimental effects on the
ld economy.
as As the budget increases, more
taxes must be collected,
economic productivity slows
down due to decreasing
disposable income, and high in-
terest rates plague the economy
because the government has en-
tered the borrowing market.
Those results we know quite well
and are the obvious reasons for
eliminating deficits.
Ultimately, the federalgover-
nment can be no different than
households. The family budget
should be balanced, expenses
should meet revenue, and any
deficit should be made up in later
years. Meanwhile, the family.
faces lean times. No economic
theories are valid reasons to
allow deficits.
PEOPLE argue that the an-
swer is not in a constitutional
amendment, but electing fiscally
responsible representatives. Sin-
ce such a miracle has not hap-
pened in the past few decades,
law can force
balance budget
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there is no reason to expect
responsible representatives to
magically appear in the near
future.
Only when balanced budgets
are required by law, as in the
state of Michigan, can the budget
be balanced, and the $1 trillion
deficit that has piled up
eliminated. There is no other
way.
So, now what have we got? We
have a proposed amendment that
has passed-the Senate and should
be voted on by the House before
the November election. If passed
by both Houses, the amendment
goes to the states for ratification.
The law would become effective
two years after that, however.
long ratification would take. So,
don't worry, there is a transition
period.
THERE still linger among
economists Keynesian ideas of a
beneficial budget deficit. A
deficit, they say, helps to "prime
the pump" and create economic
boom times. Of course, Keynes
said to pay back the debt
sometime; we haven't in the last
20 years. Now, 13 percent of
federal expenditures are
payment on the national debt,
and that figure rises with each
deficit.
Indeed, there may arise an oc-
casion, as happens often with
households, that the government
will need to go into debt, for
whatever reason. As with a
household, the decision to do so
should require a major debate.
In the proposal, there is an
allowance for a national debt. If
three-fifths of each house agree
Source: U.S. Office of Managementand Budget.
to such a move, a deficit can be
proposed. This mechanism
allows for unforseen circumstan-
ces, without much risk.
SINCE IT is usually impossible
for a majority of each house to
ever agree to anything, it is
unlikely such a move will happen.
Also, politicians are reluctant to
stand up and vote for a budget
deficit. There cannot be a real
emergency every year.
Logically then, there can be no
reason to disapprove of the
proposed balanced budget amen-
dment. In the end, we must look
at politics. This proposal
realistically has very little chan-
ce of passing the Democratic con-
trolled House.
But with large numbers of
Americans supporting the amen-
dment, Congress members would
be unwise to oppose such an im-
portant and effective law-
unless, of course, they want to be
voted out of office.
Gindin is the summer
Daily's editor in chief.
Letters and columns
represent the opinions of
the individual author(s)
and do not necessarily
reflect the attitudes or
beliefs of the Daily.
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