ÆäÀÌÁö À̹ÌÁö
PDF
ePub

taxes didn't become more unbearable than they are or raising the prices of interest. Somebody had to do the job. He stepped up to the responsibility and did it but we would very much like to share that with the Congress.

Senator ERVIN. He would like to share the responsibility of holding down funds with the Congress, but not the devising of programs and choosing which programs ought to be implemented or funded.

Mr. ASH. Well, he has proposed in the 1974 budget the priorities he would offer. That doesn't necessarily mean each and every one will be accepted just as he offers them.

Senator ERVIN. By impounding the funds appropriated for the year beginning July 1, 1972, and ending June 30, 1973, he has taken priorities set up by him, and denied those Congress set up.

Mr. Asu. Certainly for the 1973 expenditures, there being no better alternative if we are not to create that head-on collision with the other train coming down the track, higher prices, higher taxes, higher in

terest rates.

Senator ERVIN. I am a very simple-minded man, and I can't understand the effect that impounding highway funds, which we have, and then on the contrary spending money we haven't got, has on inflation. Is that to say spending money you have got causes inflation, and spending money you haven't got doesn't cause inflation?

Mr. ASH. Now we are into the context of the full employment budget and I am not sure we want to go down that road.

Senator ERVIN. The full employment budget is another gimmick, sort of like a unified budget, to give some excuse for deficit financing. The administration says if we do this, maybe we will get a little more money. That is the theory the Federal Government has been operating on ever since I got to Congress 18 years ago.

Mr. АSH. One of the things I heard was that the Congress decided we should operate under a unified rather than Federal funds concept. There is a lot of history entering in this. I suspect.

Senator ERVIN. As a matter of fact, I think President Johnson came up with the idea of a unified budget. Of course, they wouldn't want to deceive the people and make the people think they are spending less money than they are, but it is the mechanism by which that deception can be practiced.

Now, the President said something at a press conference yesterday that sort of hurt my feelings at first. He said Congress was financially irresponsible. Those are not his exact words. That is not the reason he has taken charge of the power of the purse, and that statement. sort of hurt my feelings. I got to thinking, ever since I came to the Senate and before, Congress has been financially irresponsible, in my judgment, and every President that I have served with has been financially irresponsible. I have the conviction that except in times of extreme adversity, like it was in the Great Depression, or in times of all-out war, that there is something fundamentally-I started to say dishonest, but I say irresponsible instead-in a President recommending deficit financing, sending Congress a budget that requires deficit financing instead of recommending imposition of taxes. By the same token, I think there is something fundamentally irresponsible in the Congress appropriating and providing for the expenditure of funds which it knows have to be paid by deficit financing, and I would

testify from my observation of President Eisenhower, President Kennedy, President Johnson, and President Nixon that everyone has aided and abetted the Congress of the United States, since I have been here, in being financially irresponsible.

Mr. Ash. Sir, I think I will find one ray of hope in the budget this year. The 1974 budget for the first time projects ahead in considerable detail the 1975 plan of expenditures and of revenues. While, of course, it is not as formal and firm as is the budget, at least it shows the route to a balanced budget because the plan for the 1975 budget does move us all to the place we would like to be.

Senator ERVIN. Ever since I have been here, it has been said that if we have a little deficit financing now, a few years from now we will have a balanced budget. I have been hearing that for 1812 years and the American people have been hearing it for almost 40 years and it has never materialized.

Mr. ASH. There is one very interesting aspect of that which was done in 1973. Had those programs been allowed to continue, their effect on the years 1974 and 1975 would not have been just the $11 billion in each of those years, but a total of $45 billion for the 3 years. Had we continued on the course we were on, for that year, we would have mortgaged our future in a way so as to completely remove the possibility of reaching the point of a balanced budget in 1975.

Senator ERVIN. One more observation about financial irresponsibility. I say this: I doubt that any President was a cent above the one presently in the White House who recommended appropriations and expenditures during the first 4 years of his administration which resulted in approximately $110 billion increase in the national debt

Mr. Asu. Here we are back to the discussion of the full employment budget again. I don't have along with me the charts that each of you have that went along with the budget. But those charts, under the economic theory of full employment, indicate that the main contribution to inflation was that that took place in the years 1965, 1966, 1967, and 1968 with a substantial full employment deficit that we had, but now we are on the issue of which economics do you buy.

Senator ERVIN. I am just sort of curious to determine how you promote full employment by impounding funds that are used to employ teachers and other people.

Mr. Asn. Well, as you know, through the aggregate of all economic, fiscal, monetary actions employment is going up and unemployment is going down, but at the same time there is a very precarious balance between that and prices, that is inflation and prices, and that $11 billion would have translated itself into substantially higher prices for everybody unless the alternatives were to choose taxes.

Senator ERVIN. I think it is pretty bad when Congress appropriates money to employ teachers to teach in schools at the request of the President, and the President signs that bill into law, and the administration urges that the States take advantage of that law, and then when the States take advantge of that and contract with the teachers, the administration cuts off the funds so they can't pay the teachers. I think that it is something-well, I won't say it, but it is pretty bad, I think.

Mr. Ash. My associate here has an observation to make much more wise than mine.

Mr. COIN. Senator Ervin, I would very much appreciate knowing the facts on what has happened. I don't recall when we have reserved. or impounded money that the Congress enacted for paying teachers.

Senator ERVIN. The Emergency School Act, the people who would have received the money, and the State officials who would have paid it to them and State officials were induced by the Government, and came to rely on the provisions of the act. People came up in multitudes to see me and other Members of Congress. I am sorry you didn't know it happened.

Mr. COHN. I am sorry, too, Senator. I may be wrong, but it seems to me that that appropriation was probably in the bill that was vetoed

last year.

Senator ERVIN. Oh, no, no, no. It is the Emergency School Assistance Act.

Mr. CHILES. Signed into law.

Senator ERVIN. I voted against it because I knew we didn't have the money.

Mr. COHN. I know the Emergency School Assistance Act was signed into law, but I do not know when the appropriations were enacted. Senator ERVIN. Let me get your name and address and I will have

my

Mr. COHN. Now that I know it is the Emergency Assistance Act I will look into it, Senator.

Thank you.

(The Office of Management and Budget subsequently supplied the following information for the record:)

ANSWER TO QUESTION CONCERNING IMPOUNDMENT OF EMERGENCY SCHOOL ASSISTANCE ACT FUNDS

An appropriation of $270,640,000 for the Emergency School Assistance program was provided in the Supplemental Appropriation Act, 1973, that was signed by the President on October 31, 1972. These funds were apportioned in their entirety by the Office of Management and Budget, and there is no record of their being reserved or "impounded." The full amount $270,640,000, is expected to be obligated during the current fiscal year.

Mr. Ash. And I would say one further thing without knowing anything about that specific matter, that in this particular case of this year probably many of us can make a case for this program or that program or the other program. Many of them may have merit, the issue is more merit rather than less merit. Those are the tough decisions that have had to be made.

Senator ERVIN. Five hundred and thirty-five men who have been elected by the people of the United States, and thereby given constitutional power to make those decisions, have made those decisions they offered to comply with the President's idea of a viable ceiling on expenditures, but the President opposed it on the ground that he was the one that ought to pick out which programs take priority over others.

Now, you gave three provisions to the Constitution which you say give the President power to impound funds appropriated by the Congress for specific purposes.

Mr. ASH. I am not sure I gave three. One out of the Constitution is article II which requires the President to take care to see that the laws are faithfully executed. That is the one that is a very important one.

Senator ERVIN. Yes, it is; but it happens that the appropriation bill is law.

Mr. ASH. There are many other laws and the President is confronted with living with many simultaneously.

Senator ERVIN. I don't think the President has any more power to nullify an appropriation law than he has a law to make it a crime to break into a post office. I don't know if the administration agrees with

me on that.

I think maybe you will agree with me on the proposition that the Constitution invests all of the legislative power in the Congress. Mr. Ash. I certainly do; yes.

Senator ERVIN. Section 9 of article 1 says: "No money shall be drawn from the Treasury, but in consequence of appropriations made by law." I take that as a recognition of the fact that the appropriation bill is law.

Mr. Asи. I agree with that and I believe it is a very wise part of the Constitution. No money is drawn from the Treasury that is not duly appropriated, but that does not say all money actually appropriated must be drawn from the Treasury.

Senator ERVIN. That is what I want to come to now. I do not want to detain you too long because others have some questions they want to ask.

I cannot see where the President draws any authority to impound funds by reason of the fact that the Constitution says he must take care that the laws are faithfully executed unless those laws give him the authority to impound funds.

Mr. ASH. Debt ceiling

Senator ERVIN. Yes.

Mr. AsH (continuing). Is clearly a law he is obligated to live with. What if we wrote a check and there were no funds, which is really the position

Senator ERVIN. Congress has passed a law that you cannot exceed the debt ceiling.

Mr. AsI. And he is living with that law.

Senator ERVIN. And my point is this: That this provision that the President be faithful to see that the law is executed does not give him any authority, in and of itself, to impound anything at all unless Congress authorizes it to do the impounding.

Mr. Asи. This is the only means at his command to take care to make sure that the laws are faithfully executed.

Senator ERVIN. But he has no authority in this field unless it is derived from the Constitution, or from the acts of Congress. That is the point I am making on this clause.

Mr. ASH. He is obligated to take care to see the laws are executed. The subsequent laws

Senator ERVIN. He is obligated to take care to execute the acts of The subsequent laws

Senator ERVIN. But he has no authority in this field unless it is Congress and nothing else.

Mr. ASH. One of those is the debt ceiling, another one the Full Employment Act, another one the Antideficiency Act. In attempting to live with all of those three he has no choice but impoundment.

Senator ERVIN. What provision of the Full Employment Act gives the President the power of impoundment.

Mr. ASH. The net effect of it is to maintain a sound economy and responsible fiscal actions of the Government.

Now, I cannot go to the literal words, but that is the substance that is included in that act.

Senator ERVIN. Well, I am unable to find anything in it that gives him this power. If you can find any later

Mr. ASH. I will stipulate now there is no specific law that says the President has the explicit authority to impound funds. In fact, until the word-well, let's put it another way-the word "reserves" is a word more appropriate to all of the past discussions of the laws on the subject.

Senator ERVIN. I am frank to state that I have been unable to find a single syllable in the Constitution that gives the President the right to impound funds. There is nothing in the Constitution on the subject. Mr. Asи. Except that he is obligated to follow other laws, one of which

Senator ERVIN. Those laws are statutes, they are not the Constitution.

Mr. Ash. The Constitution only says to take care to see that the laws are duly executed.

Senator ERVIN. That is the point I am making, that the President has no power to impound any funds unless Congress by law gives him that power. He is given the power-that has allowed him, to not exceed a debt limit.

So the only law you know on this subject and the so-called Antideficiency Act.

Mr. Asu. Unfortunately, I am not a lawyer, as I understand you are, but fortunately there will be a representative from the Department of Justice to deal with this subject much more ably than I have been able to.

Senator ERVIN. You came down and cited some law and started to tell us that the law justified the action, so I would like to analyze the law that you told us about.

Mr. ASH. That is the trouble with practicing law without a license. Senator ERVIN. Well, you did that in your statement, and I did not write your statement for you.

The Antideficiency Act1 is embodied in title XXXI, section 665, of the United States Code, and I want to read part from subsection (c) (1):

Except as otherwise provided in this section, all appropriations of funds available for obligation for a definite period of time shall be so apportioned as to prevent obligation or expenditure thereof in amount which would indicate a necessity for deficiency or supplemental appropriations for such period; and all appropriations of funds not limited to a definite period of time, and all authorizations to create obligations by contract in advance of appropriations shall be made so apportioned as to achieve the most effective and economic use thereof.

Now, that part of the Antideficiency Act is designed to prevent deficiencies so that the departments or agencies that administer Federal programs have to come back to Congress and ask for more money, and that was passed because one of the departments, the Post Office Department, used almost all of it in the beginning and they started to

1 See Antidefciency Act, p. 300.

« ÀÌÀü°è¼Ó »