AN ANALYSIS OF PROPOSALS TO IMPROVE CONGRESSIONAL CONTROL OF SPENDING

(By Allen Schick, Senior Specialist, Library of Congress Congressional Research Service, Jan. 10, 1973)

The power of the purse is a barometer of legislative vigor and purpose, reflecting the ups and downs in the long contest between Congress and the President for control over spending. To the victor has gone not only financial power but governmental supremacy as well. When the legislature has succeeded, it has been able to function as an independent and effective body; when it has failed, the legislature has been little more than a debating club, bereft of a significant voice in governmental policymaking.

It was over the spending power that Parliament and Crown long ago waged the historic struggles out of which emerged the concept of a legislature as a check on executive discretion. The issue was carried to the American colonies where the new state legislatures fashioned the appropriations process into a potent restraint on the governor's power to spend public funds. When the United States was formed, the issue appeared to have been decided conclusively in favor of Congress. Artícle I, Section 9 declares, "No money shall be drawn from the Treasury except in consequence of appropriations made by law."

THE DILUTION OF CONGRESSIONAL POWER

These words still are in the Constitution exactly as they were written almost 200 years ago, but the potency and the meaning seem to be diminished. Bit by bit the spending power has gravitated from the legislative chamber to executive suites and the power that once was the hallmark of legislative independence is a pale shadow of its original design. Today it is the President who possesses both the initiative and the final say, command over individual spending items as well as over the total budget. The President can marshal the enormous resources of the Federal bureaucracy in behalf of his budget and he can utilize written and unwritten rules to shape actual spending in accord with his preferences. Congress retains the power of appropriations but its scope and effectiveness are limited by the growing Presidential discretion to disregard or modify congressional intent.

In the struggle for financial supremacy, the issues and the contestants have varied with time and place but the overriding question always has been "Who shall decide how much is to be spent and for What?" In the 19th century, the issue was line item versus lump sum appropriations and the authority of the President (and administrators) to transfer funds or to incur a deficit. Periodically, Congress would tighten its hold on the purse strings in response to some administrative abuse, but over time the matter was settled in favor of broader executive discretion. What forced the shift was the growth in Federal spending and the broadening of appropriations categories to encompass numerous items. Even when Congress sought to contain administrative discretion, it sometimes opened the door to a broader exercise of executive power. Thus, the Anti-Deficiency Acts of 1905 and 1906

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established the apportionment process which decades later was to form the basis for Presidential impoundment of appropriated funds.

Increasingly, the determination of how much shall be spent and for what is made by budget and program officials under cover of Presidential authority. There is no simple measure of the loss of congressional power nor a single explanation. Certainly the Budget and Accounting Act of 1921 which set up the Bureau of the Budget and empowered the President to prepare an annual budget was a turning point. Nowadays, the signs are everywhere: in the impoundment actions of the President; in the known and unknown reprogrammings of funds by executive agencies; in the backdoor devices used to circumvent the regular appropriations machinery; in the huge carryover balances which weaken congressional ability to determine outlays; in the difficulty Congress experiences in fixing a ceiling on total expenditures; in the inadequacy of information concerning executive intent and actions.

This dilution has not occurred overnight and it certainly is not a product of the fiscal 1973 budget process. What is new and important is the depth and pervasiveness of congressional awareness that something must be done to restore control over spending. Perhaps for the first time, Members of all political colors sense a great loss of power and are determined to seek remedies.

It matters little that Congress-wittingly or otherwise-often has been the author of its own decline. Congress has given the President a powerful budget staff for managing the spending process in accord with his own wishes. Congress has opened the back door wide to programs and agencies, allowing them to spend or borrow outside the regular appropriations process. Congress has voted appropriations in increasingly broad categories, thereby enabling agencies to shift funds among activities and projects.

It will take forceful congressional action to redress the imbalance. of power which now exists. Neither the President nor the agencies can be expected to come to the rescue; in fact they probably will resist congressional efforts to reassert a dominant role in spending policy. Over the years, Congress and the President have had a seesaw relationship, with the ascendency of one marked by the decline of the other. The advance of Presidential discretion and resourcefulness has been at the expense of Congress but any restoration of congressional status will have to come to grips with the realities of big and fastmoving government. Congress will have to get off the seesaw, for if its only path of budgetary power is a weakened Presidency, the longterm prospects for recovery are not bright. Perhaps a more fruitful course would be to recognize that both President and Congress are disabled by the sprawling and seemingly uncontrollable bureaucracies and that through some common cause the positions of both central institutions might be enhanced.

Nor will any single remedy cover all the disabilities which now afflict Congress. The job will have to be done piece by piece; in the same manner that power slipped away it will have to be taken back. Loopholes will have to be plugged, back doors closed, administrative discretion trimmed. And the bolstering of congressional competence over spending will have to proceed in step with other institutional changes that are beyond the subject of this memorandum.

MORE INFORMATION, MORE STAFF, MORE TIME

One convenient explanation of congressional decline is its lack of sufficient information, staff, and time to do the job. When compared to the President who possesses bountiful resources, Congress appears to be underinformed and understaffed, and it must compress its complex appropriations responsibilities into the few months between presentation of the budget and the start of the next fiscal year.

The mismatch between President and Congress often is portrayed in terms of the thousands of computers in the executive inventory compared to the handful available to Congress. Another favored indicator is the 700-person army of budget makers in the President's Office of Management and Budget compared to the few overworked staffers who serve the Appropriations Committee. By whatever statistical measure is used, Congress appears at a disadvantage, incapable of matching the superior resources positioned throughout the executive establishment.

Yet the plain fact is that in sheer numbers Congress is not as bad off as some people think. Against the hundreds in OMB, one might point to the thousands in GAO plus the many others stationed on congressional committees and in the Congressional Research Service. Congress operates a vast data-gathering network through its hearings processes. Thousands of administrative personnel are available at all levels of the executive branch to satisfy congressional inquiries. Much of the budget work done by Presidential staff assists Congress' own appropriations task which would be significantly more difficult in the absence of an executive budget process. Moreover, as any student of the Legislative Reorganization Acts of 1946 and 1970 must conclude, additional staff alone will not do much to close the gap between the legislative and executive branches. A boost of 1000 staff positions might improve the overall competence and constituency services of Congress if spread among individual offices and committees, but it would not make much of a dent in the spending control problem that now besets Capitol Hill.

The gap between Congress and the President is much more qualitative than quantitative; that is, it relates to the kinds of information available to Congress, the sources of data, the timing of their availability, and the ability of Congress to analyze the information in its possession.

Congress is painfully dependent upon Presidential agencies for essential program and financial information; it gets only what the executive gives. This dependence seriously compromises the ability of Congress to function as an independent institution with the dual responsibility of restraining executive power and establishing national policy. Congress generally has little trouble finding out what the President and agencies have decided or want; the budget itself is an encyclopedia of facts and decisions. But Congress often has great difficulty in extracting information relating to other options that may have been considered and rejected. The budget is a case in point for it is presented and defended in a manner that obstructs the exploration of alternative courses of action. Yet it is precisely information about alternatives that Congress needs most if it is to fulfill its mission as an independent branch of government. Without information that opens

the possibility of alternative policies, Congress is beholden to the President and cannot make informed and independent judgments.

The problem cannot be significantly corrected by requiring administrators to comply with congressional requests for information. There already are enough such requirements on the statute books to give Congress all of the information it needs and it is doubtful that more laws would loosen the obstinacy of administrators. The problem is not so much one of executive privilege (the outright denial of information to Congress) as one of executive recalcitrance, the practice of supplying information grudgingly in response to congressional pressure. And pressure is most needed for prying loose information that calls into question executive decisions or enhance the possibilty of a differing stand by Congress.

If it is to regain its independence, Congress needs its own sources of information, the capability of analyzing the President's budget proposals along with any alternatives it may wish to consider, and sufficient time to do a responsible job. Concerning each of these needs, the existing budget/appropriations process is deficient. The six remedies outlined in the following paragraphs range from the most to the least substantial alteration in congressional procedures for making spending decisions.

1. Establishment of a congressional budget process to parallel the executive budget process.-The Budget and Accounting Act of 1921 gave initiative in budget making to the President. It also equipped the President with his own budget staff and gave him broad powers to superintend agency expenditures. Subsequent enlargements of the scope and power of the President's budget process have been achieved largely through executive orders and reorganizations rather than through legislation. The 1921 Act established GAO as a counterforce to the new Bureau of the Budget but the role of this legislative agency was primarily one of auditing agency expenditures, not budget preparations. While GAO audits and evaluations are valued source of information for Congress and GAO staff occasionally are detailed to congressional committees (including the Appropriation Committees), Congress lacks an equivalent to the President's budget office.

A congressional budget staff could function in a manner not dissimilar from OMB. It would receive agency requests in the Fall. at the same time they are sent to OMB. The congressional budget agency would have a 3-4 month period for review of the requests prior to presentation of the President's budget. If desired, it could solicit information not currently obtained through the executive budget process or it could conduct hearings to prepare the groundwork for subsequent congressional action on appropriations.

The congressional budget agency might be placed within GAO or it might be assigned to the Appropriations Committee (or to a new budget committee if one were created). Alternatively the budget agency might be modeled along the lines of the Joint Committee on Internal Revenue Taxation whose staff serves both the House Ways and Means and the Senate Finance Committees. A key decision would be whether to cast the new budget agency as a nonpartisan group providing professional service to Congress or as a partisan staff responsive to the political viewpoints of members and committees.

There can be little doubt that activation of a congressional budget process would bolster the legislative branch at the expense of the President. Congress would enter the process at an early stage, unencumbered by Presidential recommendations and it would possess a source of information and judgments substantially free of Presidential influence. Congress also could utilize its new budget machinery to keep track of agency expenditures and programs after appropriations have been voted and it could thereby curb the discretion currently exercised by OMB. Even if the President's budget process were formally left intact, establishment of a congressional process would make serious inroads into White House and Executive Office power. The effects would go deeper if Congress chose to withdraw some of the powers accumulated by the Presidency over the past half century.

Is this sweeping remedy too strong for the ailment? In particular, would it force a return to the problems and abuses which led Congress to establish the executive budget process early in this century? In weakening the Presidency, Congress might face an even more difficult task of controlling agency spending appetites. While Congress would be in a better position to increase spending for favored agencies and programs, the problem of bringing overall spending into line with resources might be exacerbated.

Other costs might come from the duplication of budget processes and workloads, a general dilution of Presidential leadership, inflexibility in certain administrative processes, and a constricting of the budget's role as an instrument of economic policy. Nevertheless, if Congress determines that it can become an equal partner in national policymaking only if it enjoys full parity in the budget process, the costs of a separate congressional budget process might be acceptable. Of course, Congress might decide to vest its own budget agency with limited powers and thereby retain many of the advantages inherent in the executive budget process.

2. Conversion of OMB into an agency responsible to both Congress and the President.-From the time of its formation in 1921 until its transformation into the Office of Management and Budget in 1970, the Bureau of the Budget was a Presidential agency. Even during its early years when it was stationed in the Treasury Department, the Bureau possessed Presidential status and this position was strengthened when the Executive Office of the President was established in 1939. The shift to OMB in 1970 further enhanced the agency's Presidential role, for under Reorganization Plan No. 2 of that year, all the powers of the Bureau were transferred to the President who redelegated them to OMB. Compared to its predecessor, OMB appears to be more subject to direct White House influence.

One way of improving congressional capability might be to convert OMB into an agency responsible to both Congress and the President. OMB would continue to manage the budget process and to prepare the President's budget. But it also would be accessible to Congress and it no longer would withdraw from the scene when Congress considers the appropriation bills. It would be available to handle congressional inquiries and to provide analytic services at the request of committees. This dual arrangement exists in a number of states where the budget director is a career official who enjoys the confidence of both legislative and executive branches and who actively assists the legis