January 30, 1997
Constitutional Implications Are Grave
Senator Dorgan and six others in his party have introduced a proposed balanced budget constitutional amendment (S.J.Res. 12) that would exclude from the operation of the amendment the receipts and outlays of the main Social Security programs, the Federal Old-Age and Survivors Insurance Trust Fund (OASI) and the Federal Disability Insurance Trust Fund (DI). In all other respects, S.J.Res. 12 is identical to S.J.Res. 1, which is the bipartisan, bicameral proposal that was introduced on January 21 with more than 60 cosponsors.
Under both joint resolutions, a fiscal year's "total outlays" cannot exceed its "total receipts" unless three-fifths of both houses of Congress provide by law for a specific excess of outlays over receipts. The two proposals define "total outlays" and "total receipts" differently, however.
Here is the relevant section of the Dorgan proposal, with the added language italicized:
"Section 7. Total receipts shall include all receipts of the United States Government except those derived from borrowing. Total outlays shall include all outlays of the United States Government except for those for repayment of debt principal. The receipts (including attributable interest) and outlays of the Federal Old-Age and Survivors Insurance and the Federal Disability Insurance Trust Funds (as and if modified to preserve the solvency of the Funds) used to provide old age, survivors, and disabilities benefits shall not be counted as receipts or outlays for purposes of this article."
In short, the Dorgan amendment takes particular, named statutes and grafts parts of them onto the Constitution of the United States. This crafty device will have grave consequences.
S.J.Res. 12 is a constitutional anomaly. The Dorgan amendment cites the receipts and outlays of two statutory trust funds of the Social Security Act so as to "constitutionalize" them. This is unprecedented. The Constitution of the United States does not contain named statutes. If the Dorgan amendment were added to the Constitution, future amendments to the Social Security Act would have some sort of constitutional significance.
S.J.Res. 12 is open-ended. The Dorgan amendment would "constitutionalize" the OASI and DI trust funds on the date of enactment and forever thereafter, however amended. The amendment is very clear on this point ("as and if modified," it says) -- and it is no small point. The entire Social Security Act has been amended hundreds of times; the key section that establishes these trust funds, 42 U.S.C. 401, has been amended some two dozen times, or about once every three years. The pace of amendments has increased in recent years so that now it is being amended almost yearly. Under the Dorgan amendment, future amendments to Title II may have constitutional significance. It need hardly be said that they will have fiscal significance.
S.J.Res. 12 is unrestricted as to revenues. All revenues to the two trust funds, from whatever source derived, are put "off budget" by the Dorgan amendment. It can be predicted, therefore, that future Congresses will be astonishingly creative in raising or diverting taxes or borrowing money for these "off budget" accounts. A constitutional amendment is expressly designed to chain Congress's ingrained habits for taxing and taxing, spending and spending, borrowing and borrowing. Creating a huge loophole for manipulating revenues is contrary to the purposes of the amendment.
S.J.Res. 12 is virtually unrestricted as to outlays. Unlike some former versions of constitutional amendments with Social Security exceptions, the Dorgan amendment requires that "off budget" outlays be "used to provide old age, survivors, and disabilities benefits." These words might find their way into the Constitution, but their definitions will not. The definitions will be provided by future Congresses, and those definitions may have no particular connection to current definitions. Is there any reason not to think that the Dorgan amendment's fiscal black hole will draw into it every manner of economic, educational, and cultural "disabilities benefits"? In fact, the Dorgan amendment provides an incentive for creating all kinds of benefits and putting them in OASDI because that is where they will be safe from the commands of the balanced budget amendment. Frankly, the Dorgan exception is a threat to Social Security as we now know it.
S.J.Res. 12's definition is short but has extraordinarily complex implications. The Dorgan amendment's key sentence is only about 50 words long because it uses titles, but giving short names to complex laws does not simplify the laws. The OASI Trust Fund and the DI Trust Fund, together with their legislative histories, take up some 300 pages in the United States Code, 42 U.S.C. 401 - 433. Additionally, these sections of the Social Security Act are referred to in numerous other sections of Title 42 and in Titles 2, 5, 7, 10, 12, 14, 22, 26, 29, 30, 31, 38, 45, 49 Appendix, and 50 Appendix. The cited laws are neither short nor simple.
Any attempt to stick named statutes into the Constitution of the United States presents enormous problems of both law and logic -- never mind policy. The problem is not a technical one and cannot be fixed by redrafting.