To facilitate initial research, students were divided into four task forces to investigate various aspects of the issue: (1) Perspective of Impoundment-A Historical and Comparative Study; (2) The Federal Budgetary Process and Case Studies of the Impact of Instances of Impoundment; (3) The Budgetary Process in State and Local Governments, and Case Studies of the Impact of Instances of Impoundment; (4) Analysis of Constitutional and Legal Questions Raised by the Practice of Impoundment. The goal of these task forces is to raise and analyze a broad range of issues and discover pertinent resources for continuing study.

(1) The perspective study is researching the evolution of the theory of separation of powers and the intentions of the framers of our constitution. Study of the budgetary practices and relative powers of branches of other governments is also in progress. Through research as well as gathering data from foreign officials, the experiences of other nations will be used to evaluate the strengths and weaknesses of our own system. The possibility of a correlation between "impoundment" and governmental complexity produced by industrialization is also considered a relevant area of inquiry. Further, this task force is analyzing the history of congressional enactments affecting executive spending discretion such as the antideficiency acts. This analysis should provide insight into what has been called an abdication of power by the Congress to the executive branch. Finally, this task force is considering the definitional morass created by use of the term "impoundment." It is evident that the word has unfavorable connotations in some circles and that guidelines are necessary for the use of "impoundment" as well as terms such as "reserving," "withholding," "reprogramming" and "transferring.”

(2) The second task force is examining the entire budgetary cycle from formulation to expenditure. The analysis will include a consideration of the relationship between revenues and expenditures. Additionally, the method of the implementation of fiscal policy and the economic rationales for government spending or nonspending are being studied. Because of the central role of the Office of Management and Budget within the budget cycle, a historical analysis of its genesis and contemporary and potential development as well as study of its predecessor, the Bureau of the Budget, is being conducted. The Government Accounting Office will also be examined in order to gain insight of its historical, current and possible future role. Accompanying the analysis of the budgetary cycle will be a case study of the discoverable instances of "impoundment" with an analysis of their historical economic and political context and their ultimate impact.

(3) The third group has directed its inquiry to the utilization of "impoundment" in state or local governments. While the term "impoundment" is not generally utilized at this level, executive spending discretion exists. This investigation will provide a further analysis of a myriad of budget systems including states that apparently preclude "impoundment" and others which constitutionally provide for non-spending of appropriations by the state's chief executives. This task force will also provide a means of measuring the efficacy of the often proposed alternative to "impoundment," the item veto. The majority of states. unlike the federal government, provide for such controls.

(4) The last initial investigatory team is studying whether or not judicial review of instances of "impoundment" is available or desirable. The threshold questions of standing and justiciability are central to the inquiry. Further, the constitutional provisions cited as a basis for "impoundment" and those said to forbid it will be assessed. This group is also monitoring the progress of current litigation.

FINAL REPORT

The final report will consider all relevant data received and analyze viable alternatives which may be exercised by the executive and legislative branch. Presently, completion is set for sometime in August of 1973 with the possibility of a preliminary report at an earlier date. Suggestions will take the form of possible legislative solutions, possible structural changes in the legislative and/ or the executive branch, and the feasibility of litigation.

"Impoundment" may be viewed as a presidential response to an existing problem. In some instances it may be a justifiable response while in others it may not. It may be possible for congress to eliminate some of the major sources of the problem by instituting legislative or structural reforms in the budgetary process or supplementing its own expertise. Or, the President and the executive branch

might succeed in mitigating the problem through their own actions. Ultimately collaboration between Congress and the executive branch might be the vehicle for final resolution of the current conflict. If differences cannot be resolved, than the role of the courts or other tribunal could become crucial.

Senator ERVIN. Do you have a statement, Senator Metcalf?

Senator METCALF. No statement.

Senator ERVIN. Senator Muskie?

Senator MUSKIE. Mr. Chairman, I am scheduled to testify tomorrow so I would like to hold comment. I would like to compliment the chairman in holding these hearings, especially the timing. You couldn't have a better time to determine the prerogatives in the area.

Senator ERVIN. I want to thank you and bear witness that the distinguished Senator from Maine has long been an advocate of reasserting powers of Congress.

Senator Percy?

OPENING STATEMENT OF SENATOR CHARLES H. PERCY OF

ILLINOIS

Senator PERCY. Thank you, Mr. Chairman. I will apologize for the brevity of my statement, but I don't think anybody will object.

I believe these hearings are extremely timely from the standpoint of the presentations made by the President for spending on some of our social programs, because I could foresee a very sharp series of confrontations in the appropriations area. This confrontation extends to other aspects of the separation-of-powers problem.

I believe Congress and the Executive must agree on a new definition of their respective powers or we are going to risk valuable time in bickering and jurisdictional problems, but I hope we will face up to the problem that we do have twilight areas in here that need redefinition, and I think particularly today Congress has been stunned because of the charges against Congress that we have abrogated our responsibilities with respect to the Vietnam war, and warmaking powers in general are now in the appropriation process.

These hearings are also appropriate because they directly complement the studies of the congressional appropriation process now being conducted by the Special Joint Commission on Budget Control. It is possible to mitigate if not eliminate the impoundment problem to modernize use of its appropriation power. My year's service on the Appropriations Committee does not make me any better in the process, but I am appalled by the way we go about appropriating funds in the Congress. It certainly is subject to a great deal of improvement, and I think the study now underway will bring us toward that, and I have made some very specific recommendations on overhauling that system. I hope that we will get a recommendation of the joint committee by their deadline, February 15, for a workable, new appropriation system. Finally, Mr. Chairman, I commend you for having convened this special joint panel of our two committees, and I do approach this with a very open mind. I have a great deal to learn as a result of these hearings. I look forward to hearing from witnesses on both sides of the issue.

This administration is not the first administration to impound funds. I can well remember when funds were impounded by Presi

dent Johnson for a major Federal building to be built in Chicago, and I supported his decision. It's piling Federal construction on top of an already overcrowded situation with scarcity of labor, driving costs up. and it was more appropriate that that building be delayed when the pressure was off spending in that particular area, and when we could actually use the impoundment rather than stealing it away from Federal impounding of funds, occasionally, for the highway construc

tion.

I think it is ludicrous for us to set up a system where we have billions of unspent moneys in highway trust funds, when we are starved for funds in mass transit; and I applaud the President for responding to a situation, whether he be Democrat or Republican, that we have simply because of the pressures of lobbyists, failed to face up to ourselves. We had better get a sense of forcing funds into areas where we desperately need it for lower income people and in transportation. So I look forward to trying to find a better rationale for this problem. It is very timely that we have these hearings.

Senator ERVIN. The chairman would like to say that he agrees with you that Congress has a very solemn responsibility to devise some practical way by which Congress can bring the appropriations it makes in harmony with the tax resources which it makes available. Mr. Javits?

OPENING STATEMENT OF SENATOR JACOB K. JAVITS OF NEW YORK

Senator JAVITS. Mr. Chairman, may I say that I certainly agree with you that the Congress must face that responsibility. The proposal that I understand is now being considered, would authorize a joint committee to establish a spending ceiling, which would be approved by the House and Senate. No appropriation bill could appropriate funds or be voted on until such time as the Congress sets its own ceiling. Then the President, if we do schedule our own ceiling, would have the power to cut spending back, and we could override that by two-thirds vote. The situation requires the discipline in our own house.

Senator ERVIN. I thank you for your comment.

Senator JAVITS. Thank you very much.

What we are doing today, and I express my appreciation to the Chair both in introducing the bill and conducting the hearing, is to deal with a key contemporary problem in American Government. That problem is how to share between the President and the Congress the awful powers of making war and spending money. We have heard a lot about the power of the Congress, but we are deprived of the power of the Congress when the line item veto is employed under the guise of impoundment, and that is exactly what is happening.

Other Presidents have done it. It is not confined to President Nixon. President Roosevelt contended Congress was only setting a ceiling when he appropriated money. President Truman impounded $800 million for aircraft, and the Congress had quite a dispute with him about spending. Today we have roughly $12 billion involved in the impoundment action of President Nixon.

Now, impoundment has in the past occurred when-under the antideficiency Act-it was asserted that circumstances had changed so

that the Executive could lawfully refuse to spend funds that Congress had appropriated or when there was fraud or embezzlement or some common sense management reason for such action. None of these reasons apply in the present definition of impoundment, which is simply the President's claim, that the national economy requires that less be spent.

Now, Mr. Chairman, the Chair has approached this matter in a very interesting way with respect to the power of the Congress to revoke, as it were, the impoundment. I am a little troubled about the fact that that bill tends to concur in the fact that the President has an impoundment power. It may be that some other approach would be desirable. This would not be in derogation of the magnificent work of the Chair, who pioneered the effort, but I have been thinking about the possibility of acting, for example, through the supplemental appropriation process which can delete funds as well as add them. If I have a definitive proposal, I will take the liberty of asking the Chair to accept and submit it to the committee.

But the key point is the Congress is challenging the power of the President to impound.

Finally, any reassertion of congressional power, as it were, must satisfy the country that it is coupled with responsibility. The budget is the balance wheel of the national economy. It must be developed and executed rationally. Therefore, I hope that our committee will also look into these ideas like that which Senator Percy has just referred to. We have to staff ourselves properly. Consider the resources in the executive branch which handle the budget, and compare it to the nil resources that we have for the same purposes. We should consider establishing in the Comptroller General's Office or in some other way a congressional agency which will give us equal information and therefore equal responsibility to marry to the authority we now seek. Mr. Chairman, we are engaged in a historic struggle basically relating to the fundamental nature of representative government. We are carrying it on as to the making of war, and now we are carrying it on as to the making of appropriations, and I believe that this is in the highest interest of our Nation's future and the constitutional balance of the three elements of our Government.

I thank the Chair for its very fine work. I think the country should thank the Chair, and I feel a great privilege in being a part of that act. Thank you.

Senator ERVIN. Thank you.

I would like to state that all of us would appreciate any suggestions for improvement of S. 373, or any suggestions of alternative measures which might be offered to accomplish the same thing.

Senator Gurney?

OPENING STATEMENT OF SENATOR EDWARD J. GURNEY OF

FLORIDA

Senator GURNEY. Thank you, Mr. Chairman.

Before commenting upon S. 373, the impoundment procedures bill, I would like to make some general observations regarding the crisis over control of the budget which is now facing Congress. While I believe that for the most part President Nixon's various impoundment. actions have been a necessary, short-term evil in view of the current

threat of inflation and the runaway condition of the Federal budget, I also believe that the scope and degree of those impoundments have resulted in a very undesirable exercise of Executive power. It is a use of power which the words of our Constitution do not contemplate. Congress must begin to regulate such executive actions by limiting executive discretion and placing ultimate control of the budget back where it belongs in the legislative branch. To do this Congress must permanently reform its own budgetary procedures and redefine those lines of budgetary authority which are to be shared by the executive and legislative branches.

The blame for the crisis of power in which we find ourselves must be placed upon ourselves, the Congress. We have given discretionary budget authority to the executive through such legislative precedents as the Anti-Deficiency Act of 1905, the Budget and Accounting Act of 1921, and the Omnibus Appropriations Act of 1950.

In addition to these precedents, we have, through our own inaction, created a vacuum in the area of budget control, which has been willingly but necessarily filled over the years by various Presidential administrations. That vacuum began developing at least as early as 1946, when Congress failed to implement reform of the appropriations process in accordance with the Legislative Reorganization Act of 1946. We continued our inaction through last year when we were informed by the administration that unless spending were held to a ceiling of $250 billion, the alternatives would be higher taxes, a resurgence of inflation, higher interest rates, or some combination of these. At that time we did nothing to insure that the budget would be pruned according to priorities of Congress choosing. We recognized the sad state of affairs when we created the Joint Committee on Budget Control to propose procedures for "improving congressional control of the budgetary outlay and receipt totals" and for assuring coordination of an “overall view of each year's budgetary outlays" with an "overall view of the anticipated revenues for that year."

In short, the problem was not created by the executive branch: it was created and can be solved only by the legislative branch. And the legislative branch cannot begin to solve this problem until it gives itself the ability to do so by providing itself with adequate staff, facilities, and equipment.

The inadequacy of the resources we devote to studying how much money we have and how much money we spend, are obvious when one realizes that the Senate and House Appropriations Committees, together, have only some 86 staff members with a total staff salary of only $1.9 million. This contrasts with the 660 employees of the Office of Management and Budget who are salaried by some $19 million. OMB has 112 employees receiving salaries at the level of GS-15-more employees in that one salary category than all employees in all salary categories who work for Congress on its Appropriations Committees.

This imbalance is all the more apparent when one realizes that because of our own lack of budget control, combined with enactments of prior years which have resulted in a great body of back door and mandatory spending legislation, our Appropriations Committees consider less than 50 percent of the moneys expended in a given year. Even for the parts of the budget left to continuing congressional review.