Ronald Reagan picture

Remarks at a Rally Supporting the Proposed Constitutional Amendment for a Balanced Federal Budget

July 19, 1982

Well, my fellow citizens, today we come together on historic grounds to write a new chapter in the American Revolution. We represent men and women of different faiths, backgrounds, and political parties from every region of our country—the people live on Main Street, U.S.A., and they're saying, "We love this land, and we will not give up our American dream."

But for to long, their voices have been ignored. But no army on Earth can stop an idea whose time has come, and our time is now. We don't come as a special-interest group pleading for personal gain; we're messengers of a united people demanding constitutional change.

"Crisis" is a much abused word today. But can we deny that we face a crisis? Thomas Jefferson warned, "The public debt is the greatest of dangers to be feared." He believed that it was wrong and immoral for one generation to forever burden the generations yet to come. His philosophy prevailed for the first 150 years of our history.

President Coolidge said, "There is no dignity quite so impressive and no independence so important as living within your means." But then, without quite knowing how it happened, we began surrendering to a siren song that was called "the new economics." Budgets became chronically unbalanced. Inflation, we were told, was good for .us—necessary to prosperity. And the growing debt was no problem, we were told. We owed it to ourselves.

So, we've only balanced the budget once in the last 22 years; the national debt more than doubled in just the last 10. It was ready to break the trillion-dollar barrier when we took office. The debt prorates out to $18,000 for each and every family in the United States. Borrowing to finance the annual interest on that debt, which is greater than the entire national budget just 22 years ago, more than a hundred billion dollars, crowds out investment and keeps interest rates too high.

I've said before on occasion that balancing the budget is like protecting your virtue. You just have to learn to say no. [Laughter]

Since 1960 Federal spending has increased nearly 700 percent. That's much faster than our ability to pay for it. This spending was excused in the name of fairness and compassion. But it turned out that fairness and compassion also meant local governments losing control of their communities; working people, small business, and pensioners being hit by record interest rates, inflation, and' taxation. And that golden era of growth that we once knew in this land gradually slipped from our grasp.

Let's quit kidding ourselves. Pretending government could spend like there is no tomorrow and not hurt anyone has ended up punishing everyone—and the needy most of all.

While we were doing all this, did we forget the function of government is not to confer happiness upon us? The Declaration of Independence does not say, life, liberty and happiness. It says, "life, liberty, and the pursuit of happiness." There are some things that are left to us to do.

Now, these are not Republican or Democratic principles. They're American principles, as important today as they were 200 years ago, when our ancestors were fighting a revolution so that we could be free to work out happiness for ourselves.

Families stand at the center of society. They're the vanguards of America's future. Yet, how can families and family values flourish when big government, with its power to tax, inflate, and regulate, has absorbed their wealth, usurped their rights, and too often crushed their spirit? This nation's greatest transfer program is not welfare; it's the annual turnover of you and your neighbor's income to Uncle Sam.

Runaway government threatens our economic survival, our most cherished institutions, and the very preservation of freedom itself. The people have had it. The people are saying, "Enough."

Well, you know, our administration has the strange idea that you all weren't born just to help government grow fatter. As a matter of fact, we promised to make a new beginning, to build together a brighter future filled with opportunity and hope. Together with a bipartisan coalition, we've cut the growth of Federal spending nearly in half. Imagine how much worse this expected deficit would be if we had permitted spending to keep shooting up at its 1980 rate of 17 percent a year.

Another of our ideas was a reform that I'm mighty proud of, an historic program of incentives for savings and investment with a 25-percent personal tax rate reduction for every American who pays taxes. Now, some critics complain, your tax cut is too big, that it costs government too much. Well, this may be a shock to them, but that money isn't the government's to begin with. It belongs to you, the people who earn it, and it's about time you were allowed to keep a bigger share of your own earnings.

You know, the plain truth is, our tax cut actually does little more than offset the biggest tax increases in our history passed by many of these same complainers back in 1977. We didn't get that trillion-dollar debt because you're not taxed enough; we got that debt because government has spent too much.

Maybe some of you are older to remember a gentleman named Will Rogers. Will Rogers once said, "I see a great deal of talk from Washington about lowering the taxes. I hope they get 'em lowered down enough so people can afford to pay 'em." [Laughter] Well, that's what preserving the third year of the tax cut and indexing are all about. Eliminate them, and low- and middle-income earners lose nearly 40 percent of their entire tax reduction.

We can close loopholes; we can broaden the tax base. The tax bill approved by the Senate Finance Committee meets these objectives, and I urge its enactment. It is only by reducing tax rates and slowing price increases that Americans can finally have more money to spend, save, and help the economy grow.

Our program is doing that, but it's been on the books less than a year. We must and we will get America moving again, but not by taxing the American people into the poorhouse. We've only begun to wean ourselves from the long misery of overtaxing, overspending, and the great myth that our national nanny always knows best. We should go further in reducing tax rates and making the whole system more fair and simple for everyone. But before we can do that we must correct and control a budget system that has run amok.

Time and again the good sense of the people is trampled by powerful special interests lobbying to spend and spend and spend. The Congress passed legislation in '78 requiring the budget to be in balance by fiscal year 1981, but just like Rodney Dangerfield, that legislation didn't get no respect. This year the budget resolution was not passed in time to comply with the law. It seems to me that Americans are saying, "No more ifs, ands, buts or maybes—we want an amendment to the United States Constitution making balanced budgets the law of this land, and we want it now."

Now, of course, we have to recognize all balanced budgets aren't created equal. The crucial question is how do we balance the budget? I don't think you want us to balance the budget by weaseling out of the first decent tax program since John Kennedy's tax cut nearly 20 years ago. Nor would you have us do it by compromising defenses and placing our country's security in peril. There is a better way. Balance the budget by bringing to heel a Federal establishment which has taken too much power from the States, too much liberty with the Constitution, and too much money from the people.

There are now two resolutions pending-one in the House and one in the Senate-which enjoy strong support and which would lead to a constitutional amendment requiring a balanced budget. They would require the Congress to adopt a balanced statement of taxes and spending each year. The growth in tax revenues could not exceed the prior year's growth in national income. This would be a limitation against reaching a balanced budget by simply sending the taxpayers a bill for whatever the deficit might be.

The Congress would have to make tough choices to control so-called uncontrollables. And believe me, that's what this skeptical country is waiting to see. The public could see who's hiding behind the rhetoric of balanced budgets, at the same time they're unwilling to make the cuts in spending to bring them about.

Now, this doesn't mean, as some contend, that the Congress would be bound by a fiscal straitjacket, never able to plan a deficit. It could do so by going on record with a 60-percent vote of the full membership of both Houses. This would be an important discipline.

Once approved by the Congress, the amendment will have to be ratified by three-fourths of the States. It would then take effect for the second fiscal year beginning after its ratification. But ratification itself will produce an immediate impact. From that moment on the watchword to Washington will be "start shaping up or you may be shipping out."

Now, ratification should not be difficult. Thirty-one States have already undertaken a separate initiative in favor of an amendment. And surveys show four out of five Americans want a constitutional check on red-ink spending. My mail reflects this strong support. Republicans and Democrats alike are ready for a goal line stand against big spending, even if that means pruning some popular programs.

People understand that making this government live within its means will ultimately do more to bring down interest rates and put our unemployed back to work than anything else we could do. Balancing the Federal budget will also bring lasting benefits to State and local governments. Once the Federal Government can no longer preempt State and local revenues, then those governments closest to the people can better fulfill their mission envisioned by the Founding Fathers—they can become the true laboratories of democracy in the United States.

I'm honored that leaders of the drive for passage of the constitutional amendment in the Congress—Senate Majority Leader Howard Baker; Senators Thurmond, Hatch, Helms, and DeConcini; and Representatives Michel, Conable, and Jenkins, together with so many of their colleagues—are with us here today. These Members of the Congress are supportive of this amendment. They have worked hard to help us get spending under control. Now the Senate is ready to take another step forward and pass this historic amendment.

I'm encouraged by the spirit of solidarity of the 65 responsible Democrats in the House and 17 in the Senate who are cosponsoring this amendment. They know this is no partisan issue. It is the people's crusade, and today we urge the Congress: Let their will be carried out.

You know, now there are some say that it is dangerous to push for dramatic reform in a period of crisis. Well, I believe it's more dangerous not to. We may always have a crisis of one kind or another. We may not always have another opportunity.

Others insist that a constitution should not embody economic theory. Well, I've got news for them. A wise and frugal government which does not take from the mouth of labor the bread it has earned is not economic theory. The integrity to stand for sound money, an end to deficit spending, and eventual retirement of the national debt is not economic theory. Those principles are the very heart of a tried and proven system—our system, the system which created the greatest outpouring of wealth in all history and distributed that wealth more widely among the people than anywhere else in the world. It's a pity that some seem to have forgotten that.

Then there are elitists who resent Americans like yourselves getting involved in the serious business of changing the Constitution. But our Constitution was not written to protect the government from its people. It was written to protect the people from their government.

I've told on several occasions, you know, there are a lot of constitutions in the world—haven't read all of them, but have read a lot of them—and what is the great difference that makes ours so unique? In most all of those other constitutions, it says, we, the government, permit the people the following things—they can do this or that. Ours says, we, the people, permit the government to do the following things, and no others.

George Washington told us, in his Farewell Address: "The basis of our political system is the right of the people to make and to alter their constitutions of government." It's been said that nothing will ruin a country if the people, themselves, undertake its safety; and nothing can save it if they leave that safety in any hands but their own.

Fellow citizens, isn't it time to put the safety of our beloved country back into your hands where it belongs? Isn't it time to mobilize the great American lobby and make government understand its job is to wipe out deficits and not let deficits wipe us out?

The price of freedom may be high, but never so costly as the loss of freedom. This is our moment to make our stand, to renew our revolution—the real revolution. We are a nation under God. Freedom is not granted to us by government; it is ours by divine right.

Our purpose is to provide, within a system of laws, the ultimate in dignity and individual opportunity to every American, without exception. Let us accept our responsibilities. Let history record that, when America needed us most, we didn't cut and run.

Leave here today strengthened by renewed faith and determination that we will do whatever it takes to make this government, once again, the faithful servant of the American people.

Thank you very much, and God bless you all.

Note: The President spoke at 1:07 p.m. from the steps at the West Front of the Capitol.

Earlier in the day, the President met at the White House with a group of civic and business leaders who support the proposed amendment.

Ronald Reagan, Remarks at a Rally Supporting the Proposed Constitutional Amendment for a Balanced Federal Budget Online by Gerhard Peters and John T. Woolley, The American Presidency Project

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