Over the last century, America has prospered and maintained the peace worldwide due to the military might unleashed by the vast wealth generated by her economic system. Tragically, both have been imperiled by a threat of our own making — the U.S. national debt.
To confront this danger early on, California Governor Ronald Reagan took up the torch as leader of the national campaign for a Balanced Budget Amendment (BBA) in 1975. That was a time in which our debt was just $533 billion — less than half the amount we paid just to service the debt in 2025.
In his quest to amend the Constitution, Reagan was faced with long odds. First off, proposing an amendment requires a two-thirds vote of Congress, or alternately, two-thirds of the state legislatures (34) must call a convention to or propose it. Once proposed, an amendment must be ratified by three-quarters of the states (38).
While Ronald Reagan wanted Congress to propose a BBA, he believed that it would take the threat of a convention, with 33 states, to bring that about. Therefore, in an aggressive push from 1975 to 1983, he led the BBA campaign to 32 of the 34 states required to call a convention to propose the amendment for ratification.
And while the effort never quite reached 33 states, that didn’t deter Republicans from trying. The GOP-controlled U.S. Senate was the first to muster the two-thirds vote necessary to advance a BBA in 1982 before it failed in the U.S. House due to the stiff opposition of liberal Speaker Tip O’Neill.
The next chance came in 1995 when House Republicans delivered on a promise made in the Contract with America by advancing a BBA to the U.S. Senate — only to see it fail by one vote. Sadly, that was the last time the votes were ever close enough for Congress to propose a BBA.
The great irony is that Republicans were pressing so ardently for a Balanced Budget Amendment at a time (1995) when the total U.S. debt was just $5 trillion. None of them could have imagined today’s massive $38 trillion federal debt, especially when compared with today’s meager $5.5 trillion in federal revenue.
That’s like making $55,000 a year with $380,000 in credit card debt. No one would ever be allowed to borrow that much because they could never even hope to pay the interest, let alone any principal. If anyone ever found themselves that deep in debt, they’d immediately declare bankruptcy, no questions asked.
What if you woke one morning to news that Apple Inc. had taken on a debt seven times revenue? Its stock value would immediately plummet to zero, and one of the greatest companies in world history would go bankrupt as tens of millions of shareholders were left with nothing.
These examples make it clear why Congress has no business running up such a massive debt, especially with the lives of 340 million Americans at stake. It is simply impossible to pay the interest on a debt seven times revenue unless your interest rate hits rock bottom. Even then, you would still have to borrow to pay the interest. Sadly, that would only forestall the inevitable default and subsequent financial disaster.
The most obvious example is the U.S. government which was forced to borrow over $1 trillion (20% of federal revenue) just to pay the interest on its massive $38 trillion debt which dwarfed its $5.5 trillion in revenue. Furthermore, as Congress borrows $2 trillion more each year (to pay interest and fund programs we can’t afford), it will push us ever closer to an economy-bankrupting default on our debt obligations.
Thankfully, the state-led campaign for a BBA is close to the finish line. The effort already has 27 of the 33 state resolutions needed to threaten a convention and force Congress to propose a BBA for ratification. That’s why I strongly encourage the Kentucky General Assembly to pass a BBA resolution to avert the economic disaster that looms, and return America to a fiscally sustainable path.
Former State Senator Damon Thayer currently serves as an advisor to Balanced Budget Amendment NOW, an organization committed to America’s future fiscal discipline through the adoption of the BBA, which Kentucky has yet to do. Thayer served 22 years in the state legislation before retiring in 2024. He is president of Thayer Communications and Consulting and co-founder of Kentucky Senator Bourbon.