Policy on Balanced Budget and Debt Reduction for the Federal Government

Economy
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Purpose:
The purpose of this policy is to ensure responsible fiscal management of the nation’s finances, requiring the government to run a surplus budget and prioritize debt reduction. This policy aims to prevent the accumulation of unsustainable debt and promote long-term economic stability.

Policy Overview:

Balanced Budget Mandate:
    The federal government must adopt and maintain a balanced budget, where annual expenditures do not exceed the total revenue generated through taxes and other income streams.
    A budget surplus must be maintained until the national debt is paid off, with surplus funds dedicated exclusively to debt reduction.

Spending Cap:
    Government spending is capped at the amount of revenue collected in the previous fiscal year, adjusted for inflation and population growth to ensure essential services are maintained.
    Any new spending initiatives must be offset by corresponding budget cuts or new revenue streams to ensure adherence to the spending cap.

Debt Incurrence Prohibition:
    The federal government is prohibited from incurring new debt until the national debt has been fully paid off.
    Exceptions to this rule may only be made in cases of declared national emergencies (such as war or natural disasters) and must receive a two-thirds majority approval from both the House and Senate.

Debt Reduction Strategy:
    A dedicated portion of the budget surplus must be allocated to paying down the principal of the national debt.
    A comprehensive debt reduction plan will be developed and reviewed annually to ensure consistent progress towards debt elimination.

Accountability and Reporting:
    An independent fiscal oversight committee will monitor government expenditures and revenue, providing quarterly reports on the budget’s status and debt reduction progress.
    Reports will be made available to the public to ensure transparency and accountability in fiscal management.

Constitutional Amendment:
    This policy will be submitted as a constitutional amendment to ensure it cannot be easily overturned and remains a permanent fixture of government fiscal policy.

Penalty for Non-Compliance:
    Any government officials found responsible for violations of this policy, such as authorizing expenditures exceeding the revenue cap, will face penalties, including reduction of salaries, suspension, or other disciplinary actions as determined by an independent ethics board.
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