How Trump Could Impound Budget Line-Items To Gain Leverage Against Congress in Effort To Curtail Spending

The “Department of Government Efficiency” is charged with cutting federal expenditures and there is a vast amount of low-hanging fruit to be picked. There are, for instance, no fewer than 13,808 suggestions that have been submitted by the various inspectors general for cutting government waste and fraud that have yet to be acted on by Congress.Yet if the federal government is to return permanently to budgetary discipline — after the total absence of it for most of the last 50 years — fundamental reforms to the budget process are vital.The most important reform is to put the president back in the budgetary game by restoring his bargaining power with Congress. One means that presidents used to employ to ensure fiscal discipline was impoundment, declining to spend funds Congress had appropriated.The Constitution ordains that, “No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law.” It is silent, though, on whether the president is required to spend all monies appropriated. Thomas Jefferson was the first to impound funds and every subsequent president did as well.As budget deficits mounted in the late 1960s, thanks to the new Great Society programs and the Vietnam War, President Lyndon Johnson impounded more and more funds. In 1966, he impounded no less than 3.9 percent of the total budget. So come 1972, when Congress passed the Federal Water Control Act over President Nixon’s veto, he impounded the entire $6 billion appropriated to fund it.Congress regarded this, not unreasonably, as negating its constitutional power to override vetoes and passed the Budget Control Act that forbade all impoundments. The Supreme Court, in a case brought before the Budget Control Act had passed, agreed with Congress that the president could not use impoundment to effectively negate a veto override but failed to address the constitutionality of impoundment in general.Passing the Budget Control Act immediately sent the budget out of control on a tsunami of deficit spending. Just consider, in the six years before the act’s passage and with the Vietnam War raging, annual deficits had averaged $11.3 billion. In the six years following, the war over, they averaged $54 billion.Why? Because without the power of impoundment, the president — the only person in Washington elected by the whole nation and who thus alone has a national political perspective — has no bargaining power with members of Congress (“I’ll let you have that bridge to nowhere, but only if you’re with me on reforming Social Security”). And all members of Congress have powerful parochial and political interests in ever-increasing spending, while logrolling (“I’ll vote for your bill if you’ll vote for mine”) is standard operating procedure.Only in 1994, when the country gave the Republicans complete control of Congress for the first time in 40 years, thanks to their promise in the “Contract with America” to restore fiscal discipline, did budget restraint, briefly, return. Over the next few years, spending increases notably slowed.In the budget years between 1998 and 2001 the budget was in surplus for the first time since 1969. The debt-to-GDP ratio — the most important measure of a national debt — declined between 1995 and 2001 to 57 percent from 69 percent.It was not to last. Congress, whether in Republican or Democratic hands, soon turned the spending tap back on. By 2024, the debt-to-GDP ratio had risen to a staggering 123 percent, nearly what it had been at the end of World War II, when annual budgets had increased by a factor of ten in just five years. The best solution would be for Congress to give the president a line-item veto, such as 44 of the 50 governors have. The Congress elected in 1994 did so, and Bill Clinton used it more than 80 times before it was, in 1998, held unconstitutional by the Supreme Court. The case was decided by only a six to three vote when the court was far more liberal than it is now.Politicians are always loath to give up power. As James Madison put it, “Men love power.” This is especially so over government spending. It would take a two-thirds vote of each house to send a line-item-veto amendment to the states for ratification.While amendments, with one exception, have been ratified by state legislatures, Congress here would have to specify that state ratification be by convention rather than state legislatures. The legislatures have long been deeply dependent on federal money and state legislators will always want more free money to spend. The alternative is for President Trump simply to begin impounding funds again, but impounding only line items, not whole appropriations. A lawsuit would undoubtedly end up in the Supreme Court but that would take several years and, meanwhile, President Trump would have the bargaining power needed to limit Congress’s insatiable appetite for spending.

How Trump Could Impound Budget Line-Items To Gain Leverage Against Congress in Effort To Curtail Spending

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