Balanced budget amendment
Invezz is an independent platform with the goal of helping users achieve financial freedom. In order to fund our work, we partner with advertisers who compensate us for users that Invezz refers to their services. While our reviews and assessments of each product on the site are independent and unbiased, brands may pay to appear higher up our table rankings or place ads in specific areas of the site. The order in which products and services appear on Invezz does not represent an endorsement from us, and please be aware that there may be other platforms available to you than the products and services that appear on our website. Read more about how we make money >
A proposal to compel the US government to balance its budget by a constitutional amendment forbidding further government borrowing. Such an amendment would remove the discretion to allow a deficit to deal with a ’recession or a politiccd crisis requiring increased spending. In practice, any amendment would need to accommodate short-run fluctuations in the budget position that cannot be avoided because of the dependence of revenue on fluctuations in the level of activity. There is also certain scope for ’creative accounting or the creation of off-budget but government-controlled special funds that make it difficult to enforce a balanced budget.
Reference: Oxford Press Dictonary of Economics, 5th edt.
More definitions
Invezz is a place where people can find reliable, unbiased information about finance, trading, and investing – but we do not offer financial advice and users should always carry out their own research. The assets covered on this website, including stocks, cryptocurrencies, and commodities can be highly volatile and new investors often lose money. Success in the financial markets is not guaranteed, and users should never invest more than they can afford to lose. You should consider your own personal circumstances and take the time to explore all your options before making any investment. Read our risk disclaimer >