Rescission and the Trump Administration | Citizens Against Government Waste

Rescission and the Trump Administration

The WasteWatcher

Rescission is an abstruse presidential tool passed amid the Nixon administration under the Congressional Budget and Impoundment Control Act of 1974.

Using rescission, a president can select any appropriated federal program for reduction or elimination by telling Congress what he or she intends to cut. The Congress then has 45 days to accept the decision using a simple majority vote in both houses. Rescission is filibuster-proof. Thus the law allows presidents to put accelerated pressure on Congress to act.

If Congress consents, a president can transform the federal government into his or her own image. If Congress dissents, or doesn’t vote, the cuts under rescission fail to take effect.

Because different parties normally control the White House and Congress, presidents have rarely used rescission since its inception to manage the budget.

The nonpartisan Congressional Budget Office announced on Monday that the federal government is on course to have a $1 trillion deficit in 2020. This means the U.S. government is spending much more money than it brings in. Congress added to the deficit when it passed in March its massive omnibus that increased domestic and defense spending by almost $300 billion over the next two years.

The U.S. government has the ability to run such a high deficit because the Treasury sells American debt to investors worldwide, and there is currently still an appetite to buy U.S. government bonds. However, the country has never before had such a high deficit during favorable economic times. If spending continues at this speed, President Trump and future presidents will have fewer options to stabilize the economy during the next economic downturn or crisis.

To put things in perspective, the U.S. government last ran trillion-dollar deficits during the Obama administration from 2009 to 2012 during the global financial crisis and subsequent recession. The government’s budget situation should be vastly improving now that its economic growth is healthy, but Congress continues to spend like a drunken sailor on shore leave.

Congress has not approved any spending reductions using rescission in almost 20 years—the last time was under President Bill Clinton in the late 1990s. President George W. Bush proposed rescission cuts to offset the high cost of Hurricane Katrina efforts, but Congress did not go along with Mr. Bush’s proposition.

Although Republicans currently control both the House and Senate, at least two powerful Republican “cardinals” (influential lawmakers who chair Appropriations subcommittees in the Senate) are currently standing in the way of President Trump’s efforts. Senators Susan Collins (R-ME) and Lisa Murkowski (R-AK) have snubbed the White House’s plans.

Congress will have to cancel some of the $1.3 trillion spending it passed last month if it ever hopes to get its fiscal house in order. President Trump’s use of the fiscal instrument of rescission is the best way to accomplish this.

Because Republicans never want to cut defense spending and Democrats never want to cut entitlement spending, very little spending is ever cleaved in Washington. It is understandable that supporters of a particular program would rather a different program get cut than one that they favor, but the country is on an economic precipice. Now is the time to cut spending government-wide.