This is part two of a two part interview with the President of the Compact for America, Chip DeMoss. Part one addressed the closed convention and the Compact of States they are using to try to amend the Constitution of the United States.
The organizers for the Compact for America have a scheme, and they plan to make this happen over the course of 24 hours! DeMoss is a CPA who describes himself as “fiscally-responsible.” He agreed to an interview with TAG.
The Amendment Gazette: Are you a member of a political Party?
Chip DeMoss: This is irrelevant to the CFA initiative because it is non-partisan in nature. It has to be – otherwise, passage of the compact bill, which includes pre-ratification of the Balanced Budget Amendment, in 38 states would never be possible. For the CFA BBA to pass, the country must become purple. We understand that and that is why we made a conscious effort to have our board and advisory council reflect the non-partisan nature of the initiative.
TAG: Do you have a video that describes the Balanced Budget Amendment?
CD: Here is the link to…the BBA video:
TAG: Section Five, explained by Nick Dranias, appears to reveal CFA’s extremist, tea-party-oriented politics. His claim that deficits are a spending problem, not a revenue problem is not factual; it’s a Republican talking point. After President Clinton increased taxes — something not one Republican voted to support — federal budget deficits shrank toward a balanced budget. Deficits are brought about from insufficient government revenues to cover government expenditures. Increasing the threshold for tax increases to 2/3rds of each body of Congress insures that deficit reduction will require paring down of the government (a Tea Party agenda) by making tax increases politically impossible. Furthermore, it means that the only way the United States will be able to pay off the $17+trillion debt will be to cut spending by ending the American Empire, something very few in Congress discuss, much less support, or by ending the welfare state. Isn’t the latter the real agenda of CFA? That and the rendering of Keynesian, deficit spending economic recovery impossible?
CD: If you really look at the problem today, you will find that it is totally a spending problem and the reason is simple – unlimited debt allows unlimited spending. Right now, there is no limit on how much money Congress can borrow and that suits them fine. Congress does not care what revenues are because it does not matter. They can promise everything to everybody and pay for it with unlimited debt.
The national debt problem is a systemic problem. It is a systemic problem because debt enables unprincipled elected officials in Washington to essentially buy votes. They can buy all the political benefits of the spending (or unsustainable tax policies) that they want and then shift the costs to non-voting future generations with little or no immediate impact on their political careers. That is why 49 states currently have some form of debt limit or balanced budget requirement either in their constitutions, or by case law or statute.
Regarding the supermajority requirement for tax increases in the CFA BBA, you fail to acknowledge the principled compromises made by those on the right with the realization that increased revenues will have to be part of the solution. The CFA BBA amendment requires that 2/3 of the whole of each house would have to approve any new tax or any increase in an existing tax – but with three key exceptions. There is an exception for completely replacing the current income tax with an end-user sales tax, meaning that the amendment would require any new national sales tax to completely replace all existing income taxes… Another alternative for raising revenue would be to eliminate deductions, credits and exemptions – typically called “loopholes.” Estimates range up to a trillion dollars in revenue that could be obtained by flattening out the tax code that way. And finally, tariffs or fees are not touched by this amendment. [All three tax increases] could continue to be raised by simple majority votes of Congress.
If Congress wants to exercise simple majority approval of any increase in revenue, they will be forced to run through a narrow gap. They will be forced to run head-long into the special interests that currently enjoy these loopholes, taxes and deductions. The debate for new revenues is then forced to take place head-on with the strong special interests groups who want to preserve those loopholes. If the special interest groups prevail, their actions will tend to deny increased revenues. It would not preclude new tax revenues, but it will tend to cause deficits to be closed more by spending cuts first. Thus, while the amendment provides flexibility and an opportunity for increased tax revenues, it minimizes the risk of tax-mageddon. At the same time, it also recognizes the moral fact that it is wrong to tax future generations for policy choices of today in the name of maintaining unlimited debt. [Emphasis added.]
TAG: “Totally.” Do you really want to stand by that word? I could point to the Reagan/Bush (43) tax cuts that exploded the national debt and make the case that the debt is a result of those cuts, two Bush wars that were not paid for and (as reported by the Congressional Budget Office) increases in the cost of health care.
CD: Until there are legitimate constraints placed on both revenues and additional borrowing capacity, unlimited spending is possible; and there is no need for Congress to prioritize anything. That is why I said that I believe that currently, the problem is unlimited spending that is made possible by access to unlimited debt. The CFA BBA is intended to bring about wiser government policy, incentivizing the federal government to take on a stabilizing role in the economy rather than to pursue ad hoc policies that create uncertainty and destabilize the economy as is current practice.
TAG: A balanced budget amendment and a national sales tax have been goals of the corporate right-wing for decades. What makes your board and advisory council believe that this initiative is “non-partisan” in nature?
CD: We have found that while many in the corporate world message in favor of a balanced budget amendment, when presented with a specific proposal, they are unable or unwilling to take a position one way or another. In addition, we really have not come across any from the corporate world pushing for a switch to a national sales tax. The reason we believe is simple – it is easier to avoid income taxes than it is to avoid sales taxes, and corporations have all sorts of ways sheltering income with the numerous deductions and credits that exist in the politically-motivated tax code.
The non-partisan nature of the CFA initiative is reflected in the polling results from our June, 2012 national survey of over 1,000 likely general election voters:
- 86% agreed that families must budget themselves and face harsh consequences if they fail to pay their bill and Congress should follow this rule too
- 82% agreed that when we consider cuts in federal spending, we still need to protect funding for government services that low and middle income families depend on
- 76% agreed that every time Congress adds to the federal deficit, the economic well-being of future generations is jeopardized
- 75% favored limiting the amount of money the federal government can borrow
- 72% favored requiring the President to make appropriate spending cuts to remain within the debt limit when Congress is unable to borrow more money or raise additional taxes
- 71% favored cutting spending first before taxes are raised or additional money is borrowed it the federal government spends more money than it takes in
TAG: Advocacy organizations can make polls come out any way they want depending upon how random or not their selection of voters is. Can you share your polling “methods, and … quality standards?”
CD: Sure. The national survey of 1,000 likely general election voters was conducted by the national survey and research firm McLaughlin & Associates from June 10th – June 12th, 2012. All interviews were conducted via telephone by professional interviewers. Interview selection was random within predetermined geographic units. These units were structured to correlate with actual voter distributions in a nationwide general election. This national survey of 1,000 likely general election voters has an accuracy of +/- 3.1% at a 95% confidence interval.
TAG: In one of your answers, you claim that for the BBA to pass, “the country must become purple.” How soon do you expect the country to become purple?
CD: Tough question because the country is so divided at this point in time and there does not appear to be any hope that Congress and the President will come together in the foreseeable future to resolve the pressing issues facing our nation. It would be nice if the citizen and grassroots advocates across the country could step up at this point and make a difference.
Unfortunately, we at CFA believe that many “grassroots” oriented organizations place the primary emphasis on getting people to “join” the organization. They sign a petition, send an email to a few legislators or members of Congress, read a few facebooks posts, and then are basically forgotten. We do not believe these organizations are providing the education and extensive hands-on training needed to complete the desired goal. That is we want to address in a comprehensive new online interactive website currently under design.
Through this website initiative, CFA would hope to empower citizen advocates across the country to make the necessary structural changes that will not happen in Congress. Perhaps we should call the initiative “Purple Power”.
TAG: Perhaps you should call the initiative “Quixotic Quest.” If there is no “hope that Congress and the President will come together in the foreseeable future to resolve the pressing issues facing our nation,” then what makes you believe that you can get the BBA passed “in as few as 12 months?” Explain that contradiction when Congress itself is even more divided, and the President has no role in amending the Constitution anyway.
CD: The CFA initiative has been designed to allow for state-initiated constitutional change in one legislative session, or as few as twelve months. Our research indicates that this is what the founders envisioned – quick resolution by the states to problems Congress was unwilling to address. If the collective political will exists, then we want to make sure that the appropriate resources are in place to make this a real possibility.The wild card is the response of Congress to the required congressional resolution. If many in Congress were to see the CFA initiative as a positive, something that could provide the necessary structural change that is not possible through Congress, then a quick passage of the resolution with simple majorities in each house in early 2015 would be a signal to the states to get the job done quickly. However, we realize that Congress may respond in slower fashion, or perhaps even attempt to resist change originating from the states. Accordingly, we have developed additional two-year and three-year timeline scenarios for these circumstances. The fact that the President does not have a role or say in the matter simply means that the response of Congress will be of great importance and will have a significant impact on the CFA initiative timeline and timelines from any other any other approaches to Article V that may arise from the states.