Planet Money - Can the president override Congress on spending?

Episode Date: February 19, 2025

So the president can't spend more money than Congress has agreed and voted to spend. But can the president spend less money than Congress wants?It all comes down to something called "impoundment" and the Impoundment Control Act of 1974, which controls when and how a president can take away money Congress has appropriated.President Trump followed the Impoundment Control Act rules back in 2018. But now, in his second term, he's saying he thinks that law is unconstitutional.On this episode: the history of impoundment, from Thomas Jefferson to Richard Nixon and Bill Clinton. And what constitutional scholars and judges are saying after Trump attempted to dismantle a federal agency and freeze trillions in federal funding that goes to states for everything from new school buses to public health research.Check out The Indicator's episodes on the gutting of USAID and how American farmers are affected in USAID cuts. And, our previous episode on the big government money pipe that's being closely watched right now.Find more Planet Money: Facebook / Instagram / TikTok / Our weekly Newsletter.Listen free at these links: Apple Podcasts, Spotify, the NPR app or anywhere you get podcasts.Help support Planet Money and hear our bonus episodes by subscribing to Planet Money+ in Apple Podcasts or at plus.npr.org/planetmoney.Learn more about sponsor message choices: podcastchoices.com/adchoicesNPR Privacy Policy

This is Planet Money from NPR. President Donald Trump has attempted to dismantle a federal agency, USAID, the Agency for International Development. He's attempted to freeze billions of dollars in grant money that goes to states for everything from new school buses to paying for the health benefits of child care workers, wildfire prevention. He's attempted to freeze federal funds for medical and public health research. And now, whether Trump has the power to cut off money that has been appropriated by Congress is being litigated by the courts. Several judges have blocked big parts of Trump's efforts,

ordered the administration to release the funds they froze, though there have been many examples of funds not being released. And, you know, the Constitution is pretty clear that Congress has the power of the purse. Congress decides how much money the U.S So generally it's been understood that the president cannot spend more money than Congress has agreed and voted to spend. But can the president spend less money than Congress wants? Hello and welcome to Planet Money. I'm Sarah Gonzalez and that is the thing being debated right now. Whether a president can spend less than Congress wants comes down to something called impoundment

and the impoundment control act. Basically when and how a president can impound funds, like take money away that have already been appropriated. Today on the show, what is impoundment? How has it been used in the past? And what do the judges and legal scholars who study the constitution and empowerment in particular have to say about the legality of what the Trump administration is trying to do?

Are we overlooking the challenges facing men without college degrees? Richard Reeves thinks so. There are a lot of guys out there who are actually poorer than their dads. Reeves heads the American Institute for Boys and Men. Have we updated our view about the role of men as quickly as we've changed the economy around them? And the answer is no. That's from a recent Planet Money bonus episode. A look at the economic and cultural struggles

of working class men. To hear it and get sponsor free listening, sign up for NPR Plus. Just go to plus.npr.org. When the Trump administration ordered all of the funding freezes, it upended thousands of contracts, including with US businesses and nonprofits.

For example, US farmers grow a lot of the corn and soy and food that the agency USAID sends to other countries. Last week, the USAID Office of Inspector General released a report that said that half a billion dollars worth of food was at risk of just spoiling. In warehouses, at ports, in transit. The USAID Inspector General was fired the day after that report came out. Now, the U.S. Constitution says that the president has a duty to take care that laws be faithfully

executed. And when Congress debates and decides to fund something, that's a law. But before Trump was re-elected, he was saying that he didn't think Congress had the final say here. In a campaign video, Trump said that as president, he should have the power to not spend money that Congress has appropriated. For 200 years under our system of government, it was undisputed that the president had the constitutional power to stop unnecessary spending through what is known as impoundment.

Impoundment. Trump was saying that he should be able to impound the money. Very simply, this meant that if Congress provided more funding than was needed to run the government, the president could refuse to waste the extra funds and instead return the money to the general treasury. Okay, we should note that the system kind of already allows for this, according to a legal scholar we spoke to who said that, you know, if the government can like get the job done with less money than Congress appropriates, that's totally okay sometimes. So like, if Congress appropriates $15 billion to build a new aircraft carrier, but the contractor can get it done for, I don't know,

$14 billion, that's fine. The federal government is not going to be like, oh no, no, no, you you must charge us the full $15 billion, right? The important thing is that the aircraft carrier that Congress wanted just has to get built a President cannot override Congress and say well, you know I as president don't think we should even have an aircraft carrier at all at least that is what the impoundment control act of 1974 says. It's the law that controls the president's impoundment power. But Trump thinks that law is unconstitutional. This disaster of a law is clearly unconstitutional, a blatant violation of the separation of powers.

President Trump and his team, including the person who is now general counsel at the Office of Management and Budget, which is the agency that oversees the release of federal funds, say that impoundment is an inherent power of the president because they say presidents have historically exercised this power. They have been pointing out what they call hundreds of years of examples of presidents impounding funds before Congress reigned in the practice. Basically, they're saying that impoundment was kind of chill in the early days. Well, I'm not sure I'd say chill, but I...

You wouldn't? You sound like that's definitely something you would say. Zachary Price is a law professor at the University of California College of Law in San Francisco, who has written about historical impoundment practices, including examples that Trump's team has been citing. So we will start with what is likely the most high profile instance of impoundment in 1803 with Thomas Jefferson. Congress had appropriated up to $50,000 to build 15 gunboats in the Mississippi

because the US thought that it might have to fight France over the Mississippi River. But after Congress appropriated the gunboat money, things took a turn with France. Jefferson thought the threat that had warranted this project had disappeared. So he didn't spend the money, didn't build the ships, always didn't build all of them, and then just told Congress

in his annual message when they came back, here's what I did, and this is why. Was Congress just meeting a lot less often in the 1800s? And so they went away for months and months, and he was like, I don't know what to tell you. Things are different, and we don't know what to tell you. Like things are different and we don't need all these gunboats anymore. Yeah, certainly in the very early Republic,

Congress would come for a session and then everyone would go home back to their states. Yeah, it's 1803. Congress was meeting once a year. And after Congress voted for the gunboats and then went home, this big thing happened. The US bought Louisiana from France and a bunch of other land, the Louisiana Purchase.

So France was no longer going to be near US territory, no longer on the Mississippi. And we were cool with France now. We weren't going to go to war with them anymore. So Jefferson is like, okay, well, I'm not going to build those gunboats in the Mississippi then. Trump's team has specifically pointed to this gunboat funding example to say, see, the president does have the power to not spend money. But here's the thing about this Thomas Jefferson gunboat example.

Zachary says Congress never told the president he had to spend $50,000 on 15 gunboats. Right. So that one, the law just said you can spend up to X amount on this purpose. But the law didn't say you must spend at least this much. It said no more than. Yeah. The actual law said Thomas Jefferson could order quote, a number not exceeding 15 gunboats using quote, a sum not exceeding $50,000. So baked into the law, it was always optional. So a lot of examples have that sort of character. And that's not really, Jefferson would say, I'm just faithfully executing the statute, or at least you can

understand what he's doing that way. So you're saying that all the examples of times that presidents used impoundment, there was always some little language that was like a little bit more like, you don't have to spend all this money, you just can spend up to this amount. It's not always quite as clear as Jefferson. But you know, you do have a pattern of examples sort of like that. Historically, Zachary says, presidents weren't making the argument that they have the constitutional power to override Congress and impound funds.

Generally presidents weren't really making that argument. They're instead involved in a kind of back and forth with Congress. Zachary says presidents would just kind of be like, come on Congress, let me do this. And then Congress would give in. Like there was spending for rivers and harbors that Ulysses S. Grant thought was wasteful. There was money for a weapons program that John F. Kennedy didn't want to spend

after World War II. But in both cases, after some controversy, Congress just gave in to the presidents. So in that way, yeah, Zachary says, there was this like tacit approval by Congress to sometimes not spend money. But it's not like there was a place where all the rules were spelled out around this one way or another. That didn't happen until Richard Nixon became president because Richard Nixon took impoundments to a whole new level. Well, the distinction with Nixon is also the frequency and the scope

at which he impounded funds. I mean, in 1973, impounded nearly one third of all discretionary spending. Rachel Snyderman is the managing director of economic policy at the Bipartisan Policy Center. And days before Trump's second inauguration, she published this big impoundments 101 explainer. And really refresher of, you know, what are the real checks and balances when it comes to the federal budget process as we head into a very busy year for fiscal policy and of course a new administration. The thing

that made Richard Nixon's impoundment practice so distinct was really the scale and the scope. Nixon wasn't using impoundment like here and there. He was using impoundment to subvert Congress's will. Like, Congress had approved billions of dollars to send to states to build sewage treatment plants. Nixon didn't want that, so he withheld the money. Nixon impounded housing assistance money, community development money, disaster assistance, and eventually the people and states who were

entitled to the money that Nixon was withholding sued Nixon in a bunch of courts. When he impounded funds, there were several court challenges that went all the way up to the Supreme Court, and the courts were repeatedly upholding the fact that the president did not have the authority to unilaterally make decisions about spending. The Supreme Court case was specifically about the sewage treatment plant money that states were supposed to receive

from the federal government. The Supreme Court said that the total amount that Congress had appropriated for this had to be spent. Not just any amount, the total amount, because that appropriated for this had to be spent, not just any amount, the total amount, because that was the language of the law. All nine justices agreed. Meanwhile, while all this is playing out, Congress is like, all right,

I think we gotta get some real ground rules for impoundment now. And they passed the Impoundment Control Act of 1974, which, you know, controls how presidents can impound money. You can impound funds, right? It's not the like, impoundment is not allowed act, right? It's just like it's allowed, but like in this controlled way. Yeah, so they cannot do it alone. The president must, they must go through the process and work with Congress. Under the Empowerment Control Act post-Nixon, there are now two ways a president can withhold money that Congress has appropriated.

Just two ways. The first way is called the deferral process. The president can temporarily defer payments, but with a catch. The president can choose to defer, temporarily delay certain spending if they have the explicit intent that they are going to spend all of that funding within the fiscal year. They just don't quite know when.

One example of spending that can get deferred is disaster assistance money. So we know that hurricane season tends to be towards the end of the fiscal year in September. So maybe you wanna hold off on spending too much disaster money early on so that you have some leftover around hurricane season when you might need it, right? That's a deferral. The second way a president can withhold funds post-Nixon is through something called the

rescission process. They're rescinding the money. Basically, a president goes to Congress and says, here's all the money I don't want to spend that you find people already approved. Congress then has 45 days to look over the president's proposal. If Congress chooses to do nothing or does not approve that package as a whole or in part, that funding must then be released to federal agencies and spent so Congress decides still Congress decides yes and throughout this entire time

The government accountability office is conserving as the external watchdog to make sure that this is happening And Trump knows how this process is supposed to work, says Rachel, because he followed this exact process. In 2018, when Trump wanted to rescind billions of dollars, he notified Congress, Congress reviewed it all, but then chose not to approve it. And many presidents have impounded funds this way through this process. President Trump is not alone in exercising this authority.

George H.W. Bush utilized this authority. President Clinton, President Reagan did too. So there really is precedent. This time around, though, Trump did not notify Congress. There was no rescission's proposal. So to some legal scholars, the fact that Trump is not following the normal process is about something bigger. He's clearly after something more than just restraining this funding.

He's seeking to make a point about inherent presidential authority. After the break, how Trump is testing the limits of presidential power and what constitutional scholars and the courts are saying about it. You may remember that in 2019, President Trump withheld money meant for Ukraine without going through Congress. This was when Trump was trying to get the Ukrainian president to investigate the Biden family. Trump was found to have violated the Empowerment Control Act back then, and the money was eventually released. Now, in his second term, Trump is saying, yeah, that whole Empowerment Control Act thing, I think it's unconstitutional. Days into Trump's second term, his administration announced that they were temporarily going to not spend billions and billions and up to trillions of dollars on a bunch of stuff that, you know, Democrats and Republicans agreed together to fund. He announced

the funding freeze without ever submitting a proposal to Congress. And a bunch of lawsuits followed. Nonprofits have sued, states have sued, states have sued specifically over just the medical research funding, health organizations that receive funding for USAID programs sued. So to some, this was not like a Thomas Jefferson-style saving money on some Mississippi gunboats kind of impoundment. This was more like what Nixon tried to do, using impoundments as a broader policy tool, withholding money for policies he disagreed with. Now a lot of the Trump funding freezes have been paused while the courts sort everything out just like how it went down when Nixon used impoundments this way. But what Trump's team is arguing that Nixon's team did not argue in court is

that the president should have this special power to not spend. They're saying, yes, there's a ceiling on spending. The president cannot spend more than Congress appropriates, but they don't think there's a floor. For this, I called up a law and economics professor. Do your students call you Professor Super? Uh, yes. Nice.

Wade, say your name and title. Uh, I'm David Super, and I teach law at Georgetown. David Super studies the Constitution, teaches legislation, and he actually had the Empowerment Control Act on his syllabus when all the funding freezes happened. So as a teacher, I couldn't be more grateful for their timing with this. As a lawyer and a citizen, I'm troubled by it. So okay, what about this constitutional claim that the Trump team is making?

Is there a place in the Constitution that says like, yeah, you can't spend more, but like, yeah, you could spend less? Or is there a place in the constitution that says like you cannot spend more and you also cannot spend less? Like, is there validity to their claims that like it doesn't say in the constitution that there's a floor, which is like what the argument is, right? Like the ceiling is there, don't spend more, but is the floor there? Yeah, the floor is there. The floor is there in the laws that say you must spend this money.

And in the constitution, it says you must take care that the laws be faithfully executed. You're not taking care that the laws be faithfully executed if the law says spend a million dollars and you refuse to do so. David and a long, long line of legal scholars and judges appointed by Republicans by Richard Nixon and Donald Trump have said that the Constitution does give Congress the power to set even a spending floor.

Supreme Court Justice Brett Kavanaugh, who Trump appointed back when he was an appellate judge, he wrote that, quote, even the president does not have unilateral authority to refuse to spend. But Trump's legal team has said that the Supreme Court hasn't provided the final word on whether a president has constitutional empowerment power, like inherent empowerment power just because he's the president.

They say that even that one Nixon ruling was more specific to like the particulars of Nixon's case. And David Super agrees that the Supreme Court did not rule on overall empowerment power, but only because, again, Nixon's team wasn't making that argument in court. So that's the legal stuff. In terms of the money stuff, like the money that the Trump administration

has frozen or attempted to freeze, here's what's happening there. Several judges have at least temporarily blocked just about all of those actions. Some of these judges are Trump-appointed judges, judges, at least one of the judges. Yes, he's been losing in front of Trump judges, Biden judges. It really hasn't mattered.

These judges have said that the Trump administration needed to unfreeze the money, at least for now. So the money is supposed to be released. The White House even rescinded their initial memo declaring the pause on federal grant and loans. But there are a lot of reports that money is still being held up. One judge said that the Trump administration was still not releasing the funds, which violated a court order. The judge in Rhode Island found that they had violated his order in numerous respects found that they had violated his order in numerous respects and has issued a supplemental order admonishing them to start complying right away and specifically condemning some

of the actions they've taken and some of the arguments they've made to defend their actions. State agencies in Pennsylvania still as of today have not been able to access $2.1 billion in grant funding that was suspended or restricted. This is according to the governor's office. Even though, as they pointed out, multiple federal judges have ordered the Trump administration to unfreeze this funding. Several nonprofits across the country also have tried to access their federal funding only to find out it's not there Indeed I talk to people all the time who tell me their funding is frozen still

Indeed some people whose funding was frozen after the orders were issued against that So if the administration is trying to comply they're not trying very hard and they're not trying very effectively David super says that these actions for him rise to the level of a constitutional crisis. We did reach out to the White House and to the Office of Management and Budget to ask why some federal funding is still not being released and to get their response to what David Super

and Zachary Price had to say about the history of impoundments. The White House and OMB did not respond. released and to get their response to what David Super and Zachary Price had to say about the history of impoundments, the White House and OMB did not respond. But the White House press secretary has said that it's actually the courts and the judges stopping Trump's executive actions that are the ones causing the constitutional crisis. If you want even more history and legal arguments around impoundments, check out our latest newsletter. There's a link in our show notes and you can subscribe at npr.org slash planet money

newsletter. This episode was produced by Willa Rubin and edited by Meg Kramer. It was fact-checked by Sam Yellow Horse Kessler and engineered by Robert Rodriguez. Alex Goldmark is our executive producer. I'm Sarah Gonzalez. This is NPR. Thanks for listening.