On May 8,
President Trump reportedly
will send Congress a request to rescind $15 billion in funds appropriated for a
variety of non-defense programs. Some
sources both in the White House and in Congress suggest that this may be the
first of several such requests that the President will make over the coming
months. These requests are made under
the Impoundment Control Act, on which even many budget process experts find themselves
a bit rusty. Not surprisingly, media
coverage of the possibility of rescissions has been confusing and sometimes
contradictory. This post examines the
procedural, substantive, and political dimensions of these proposals.
Congress enacted the
Impoundment Control Act in 1974 with Title X of Pub. L. No. 93–344 in response
to President Nixon’s repeated refusals to spend appropriated funds on programs
he disliked. The Act represents a truce
between congressional and executive interests, albeit one enacted at a time
when the President was severely weakened.
In lieu of the chaotic political and legal conflict that resulted from
the President’s ad hoc impoundments,
the Act established a formal procedure for resolving presidents’ desires not to
spend appropriated funds and prohibited impoundments outside those procedures.
Under the Act, the
President may submit a request to Congress to rescind any funds that have been
appropriated but not yet obligated. Special
fast-track procedures,
somewhat similar to those used to pass budget resolutions
and budget
reconciliation
laws,
then assure these proposals of receiving congressional consideration. Most importantly, this legislation makes rescission
legislation difficult to kill in committee and impossible to filibuster in the
Senate, allowing rescissions to pass with simple majority votes in both
chambers.
If Congress enacts
rescission legislation within roughly 45 days, the President prevails. (Long recesses toll the statutory 45-day
clock.) If not, the general requirement
that the President spend appropriated funds reasserts
itself and the President is prohibited
from submitting a subsequent rescission request relating to the same
funds.
This procedure has
important limitations, which go a long way toward explaining why the process
has been so rarely used (and why the Act is so widely considered an important
victory for Congress). In particular, 2
U.S.C. § 681(4) prohibits the President from invoking the Act to seek
rescission of money that is already legally obligated. This means that mandatory programs such as
Social Security, Medicare, and school lunches are not subject to rescission
because their authorizing statutes obligate those funds in accordance with their
benefit eligibility formulas. This also
means that programs that provide grants in aid to state or local governments
under a statutory formula, such as the Special Supplemental Nutrition Program
for Women, Infants, and Children (WIC) and many elementary and secondary
education programs, are exempt from rescission.
The Government Accountability Office (GAO) has confirmed this in
opinions at least as early as 1982 and as recently as December.
Although the complete
list of proposed rescissions is not public at this writing, news accounts
suggest that some will attack both programs with mandatory funding, such as the
Children’s Health Insurance Program (CHIP), and programs making formula grants
to state and local governments. If legislation
to implement the President’s proposals includes these improper rescissions, it
would be vulnerable to a point of order depriving it of the special fast-track procedures. Without immunity from a filibuster, such
legislation would have little chance of passing.
The substantive explanations
offered for this rescission proposal are both strange and contradictory. House Republicans and the White House argue
that these rescissions are needed to reduce budget deficits. These arguments come from the same quarters
that were waiving away deficit concerns just a few months ago when passing a
tax bill whose ten-year cost is 100
times the amount these rescissions claim to save.
In addition, the
White House is, on the one hand, touting large savings from these rescissions
while on the other hand insisting that they will do no harm because the money
would not have been spent anyway. If the
money would not have been spent, there are no savings. Deficit figures, whether from the
Administration or the Congressional Budget Office (CBO), work from money
actually spent. Any rescission of money
that would not be spent by definition cannot reduce the deficit.
A lot of this
seems to be doubling down on short-sightedness.
Some of the amounts involved apparently are contingency funds set aside
to continue anti-poverty programs during economic downturns. The White House argues that, because the
economy seems strong, these funds likely will not be needed. If that is true, the rescission saves no
money and is pure theater. If, however,
an economic downturn comes, why would we not want to help the newly
impoverished as much as the chronic poor?
Legislation providing in advance for unpleasant contingencies is already
too rare; if appropriators see that these funds will constantly be rescinded,
they likely will stop trying.
The truth is that some
programs likely do have more money than they need. The list of such programs surely includes
Defense as well as Non-Defense programs, unlike the President’s reported roster
of proposed rescissions. But after years
of deep cuts to discretionary spending, many other programs, such as the Census
Bureau and low-income housing, have much less than they need. The country certainly could benefit from a
thoughtful rescission proposal that sought to reallocate funds to where they
could do the most good. This, however,
is not that bill.
The politics of
rescission proposals are complex. Reportedly
the White House and the House Republican leadership promised that the President
would submit a rescission package in exchange for the votes of some House
Republicans for this spring’s omnibus appropriations bill. This revelation led to a chorus of criticism
that Republicans were negotiating in bad faith, already committing themselves
to breaking the budget agreement while demanding that Democrats make painful
policy concessions in exchange for the funding it provided. The White House has responded by insisting
that its rescissions are not inconsistent with the budget deal and reportedly
including only money appropriated in prior legislation. That is a distinction without a
difference: appropriators determine how
much new money a program needs in part with reference to how much carryover it
has from prior years. Whether the
rescission nominally covers new money or old, the program will have less
funding than was agreed upon in the omnibus appropriations bill.
House Majority
Leader Kevin McCarthy, who underwhelmed far-right Republicans last time he ran
for speaker, is clearly using his enthusiastic support for rescissions to
buttress his effort to replace Paul Ryan.
Those hoping to outflank him on the right are trying to raise the stakes
further.
Senate Majority
Leader Mitch McConnell, on the other hand, has been openly hostile to moving
any contentious fiscal measures this year.
Although a vote on a rescission package could be uncomfortable for
red-state Democratic senators up for re-election this fall, the success of such
legislation would make it much more difficult to bring Democrats to the
bargaining table in September. Having
substantial Democratic support for appropriations bills in recent years has
allowed some vulnerable Republicans to vote “no” to appease their bases. Senator McConnell may doubt whether he can muster
a majority entirely from their own ranks to keep the government open after
October 1. And any appropriations bill
that can command 218 Republican votes in the House may be so extreme that it weighs
down House and Senate Republicans seeking to run as moderates. Sorting this out with the election just weeks
away, and with Members demanding to go home to campaign, would not put their
party in the best light.