What is impoundment? How Trump thinks he can control spending without Congress
Analysis by Zachary B. Wolf, CNN
(CNN) — “Impoundment” is another word that Americans may need to learn in the vernacular of President-elect Donald Trump’s second term.
If “recess appointments” are the unlikely and unprecedented way Trump wants to work around the Senate to get his most controversial nominees in charge of Cabinet agencies, “impoundment” is the unlikely way he envisions shrinking the federal government with or without congressional approval.
Trump took the time to record a video about impoundment during the Republican primary season, and he promised seizing control over spending from Congress would be a top priority if he was elected.
What is impoundment?
The Constitution gives Congress the power of the purse. But the president is in charge of executing the law. Impoundment occurs when Congress appropriates money that the president then declines to spend.
It occurred frequently in US history, beginning in 1803 when Thomas Jefferson declined to buy gunboats to patrol the Mississippi as he negotiated the Louisiana Purchase with France.
What happened to impoundment?
Richard Nixon abused the privilege, at least according to Congress at the time. After his reelection in 1972, Nixon planned to use impoundment to achieve sweeping policy aims, according to the Congressional Research Service. He wanted to halt federal housing programs, reduce disaster aid and more.
When Congress overrode his veto of the Clean Water Act of 1972, he used the power of impoundment to refuse to spend a good portion of the $24 billion in funds meant to help clean sewage out of municipal water systems.
As a result of these standoffs, Congress passed a law to curtail a president’s use of impoundment, particularly for policy reasons. The Impoundment Control Act of 1974 did a lot more than that, however. It was passed alongside legislation that created the Congressional Budget Office, the official nonpartisan accountant on Capitol Hill, and also the House and Senate budget committees.
Trump has tried impounding funds before
Trump tried to defy the impoundment law during his first term as president by withholding funds to Ukraine as he pressured President Volodymyr Zelensky to help engineer an investigation into Joe Biden.
If that sounds familiar, it’s because that pressure led to Trump’s first impeachment by Democrats in Congress. The funds were ultimately released, and the Government Accountability Office argued that the Trump administration broke the law by withholding the aid.
What did Trump say before he was elected?
In one of the videos he recorded to outline his second-term agenda, Trump said reclaiming the power of impoundment would be a top priority, either through the courts or by getting Congress to give up its power.
The Impoundment Control Act of 1974, in Trump’s telling, is “not a very good act; this disaster of a law is clearly unconstitutional, a blatant violation of the separation of powers.”
After he reclaims this power, Trump said, “I will then use the president’s long recognized impoundment power to squeeze the bloated federal bureaucracy for massive savings.”
There will be obstacles. It does not take a leap of faith to guess that even many Republican lawmakers may not want to cede the power of the purse back to the White House.
Trump might think he’ll fare well challenging impoundment at the Supreme Court, which now leans to the right and is skeptical of the federal bureaucracy. The court recently curtailed the power of agencies to interpret statutes passed by Congress. That could also be read as a warning against executive overreach.
What about more revolutionary reform?
Another Republican who has talked about repealing the Impoundment Control Act is Vivek Ramaswamy, the Ohio businessman whom Trump tapped along with Elon Musk to lead the new “Department of Government Efficiency.”
Despite its official sounding name, DOGE – named to cross-promote Musk’s favorite cryptocurrency – is an extra-governmental initiative offering suggestions on how to engage in a massive shrinkage of the size of government, but with no authority to execute them.
Impoundment could be a key tool in their plans. As a Republican presidential candidate, Ramaswamy said a president actually has untold power to go much further simply by reimagining other existing laws.
He said a president could simply argue for efficiency and cost savings and reinterpret federal employment law to engage in a mass layoff of half the federal workforce within a year. Up to 75% of federal workers could be fired within four years, according to Ramaswamy during the Republican primary. That would be the firing of more than a million federal workers.
“Do we want incremental reform, or do we want revolution?” Ramaswamy said.
Former Rep. Matt Gaetz, Trump’s pick to be attorney general, was in the front row at a 2023 speech in Washington where Ramaswamy laid out his plan to reinterpret existing law. The men agree about the idea of shutting down the ATF, the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Ramaswamy, citing his new view of a law passed in 1977 and signed by then-President Jimmy Carter that references a president’s authority to determine changes to agencies, would also obliterate the FBI, the Department of Education and the Nuclear Regulatory Commission, among others. It’s a heterodox view of the scope of presidential power, to say the least.
It’s not at all clear that Trump shares Ramaswamy’s view of nixing all of these agencies. Even if he did, there would be lawsuits if Trump took Ramaswamy’s advice to simply end the FBI. That would be an interesting political argument to watch unfold after Republicans complained that Democrats wanted to defund the police.
This is the big-think mindset Ramaswamy could bring to DOGE. Trump clearly wants big ideas as he tries to reimagine the US government.
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