Trump could use authority to slash billions in spending
The White House is seriously considering a strategy to cancel tens of billions of dollars of wasteful spending in the $1.3 trillion budget signed by President Trump last month.
It’s a great idea, and Republicans should welcome a highstakes budget showdown with congressional Democrats, given the unpopularity of the omnibus budget. Trump has a potent tool at his disposal to not spend money.
It is called rescission authority — a power created by the Congressional Budget and Impoundment Control Act of 1974.
Here’s how it works: The president submits a proposal to cancel unnecessary funds. Both chambers of Congress must affirmatively agree to the proposal within 45 days; otherwise, the funds must be spent as appropriated. Because rescission requires affirmative consent from Congress, the House or Senate can ignore the request without a vote.
Ronald Reagan used rescissions to save billions of dollars. Over his eight years in office, Reagan proposed 596 rescissions, totaling $43 billion. Congress ultimately approved 213 of Reagan’s rescissions, for a savings of $16 billion — or roughly $34 billion after adjusting for inflation.
Sadly, in the years since Reagan left office, Congress has approved less than $6 billion worth of additional rescissions. According to the Government Accountability Office, no president has submitted a rescission proposal since fiscal 2000, and Congress hasn’t approved one since fiscal 1999.
Trump should revive the rescission process.
The beauty of this approach is that Senate Minority Leader Chuck Schumer, who demanded much of this extra spending, would not be able to stop a rescission, as long as Republicans stood together. Our research on the fine print of the law shows that the Congressional Budget and Impoundment Control Act limits debate in the Senate “on any rescission bill or impoundment resolution, and all amendments thereto (in the case of a rescission bill) and debatable motions and appeals in connection therewith ... to not more than 10 hours.”
This means that Schumer and the Democrats could delay a vote on a rescission but couldn’t prevent it. At some point, the debate would end, and the Senate can approve a rescission bill with 51 votes. That’s how many votes Republicans now have.
Trump could use the rescission to save hundreds of billions of dollars on wasteful urban transit projects with few actual riders.
For Trump to win here, he would have to do what Reagan did: take his case for fiscal solvency directly to the American people. Voters are fully aware of the dangers of a $21 trillion national debt that grows by $1 trillion every year. There’s little downside in running against the spendaholics in Congress. If the big spenders in Congress vote to save the pork and the waste, he can make an even stronger case to the American people as to why the president must have a lineitem veto.
Stephen Moore is a senior fellow at The Heritage Foundation. James Carter served as the head of tax policy implementation on President Trump’s transition team.