“Mr. President, how do you respond to criticism that your impoundment of funds abrogates power or authority that the Constitution gave to Congress?” a reporter asked then-President Richard Nixon at a January 1973 press conference.
“The same way that Jefferson did, and Jackson did, and Truman did,” the president responded. “The constitutional right for the president of the United States to impound funds — and that is not to spend money when the spending of money would mean either increasing prices or increasing taxes for all the people — that right is absolutely clear.”
Nixon, just months after winning reelection in a historic landslide, was railing against what he viewed as irresponsible spending from the Democratic-controlled Congress by using his executive powers to prevent congressionally appropriated funds from being disbursed — a decision that sparked myriad lawsuits, partisan infighting, and media outcry.
Fast forward over half a century, and President Donald Trump has found himself in a similar situation. After winning a commanding victory on election night, Trump resolved to freeze or cut billions of dollars in government spending, much of which had already been approved by Congress. This was part of an effort Trump believes will reduce the nation’s deficit and improve government efficiency. Like Nixon, he has been met by an array of legal challenges, a hostile press, and congressional skeptics.
While Nixon withheld funding for specific environmental projects, housing programs, highway outlays, and education, Trump has been much broader in his efforts. Freezes to nearly all foreign aid and, for a short time, all federal grants and loans were among the first moves made by the Trump administration. While federal judges have since blocked these orders, Trump and his Department of Government Efficiency have canceled grants and contracts piecemeal.
In late February, the Trump administration took its case to the Supreme Court to settle the dispute, but it lost.
The Supreme Court’s ruling, however, was not on the 1974 Impoundment Control Act, which constrains the president’s ability to impose spending freezes. Instead, it considered the power of low-level federal judges to issue injunctions suspending federal policy across the nation. With this avenue exhausted, the Trump administration may have its eyes on overturning the Impoundment Control Act. If the president is victorious, he would gain an effective line-item veto over every piece of spending approved by Congress, and, what’s more, it couldn’t be overridden.
Imagine a Democratic Congress approved funding for Planned Parenthood in its budget. A Republican president could order the executive branch to withhold those funds specifically while continuing to spend funds related to infrastructure or education. A Democratic president, conversely, could choose to do the same with border security funding or some other conservative priority.
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“A ruling striking down the Impoundment Control Act would remove one more institutional check on an aggressive president,” Case Western Reserve University Professor Emeritus of Law Jonathan Entin told the Washington Examiner. “I should add that the framers envisioned that the primary check on an aggressive president would be a Congress that safeguarded its own institutional prerogatives. At this point, however, the majority in both chambers of Congress seems more loyal to its party than to its institution, so that sort of political check does not work very effectively.”
At the center of the struggle over these public funds is who has the final say when it comes time to cut a check.
Opponents of Trump’s impoundment scheme point toward the first and second articles of the Constitution to argue that the president does not have the authority to cancel funding that Congress has already appropriated.
Article 2 Section 3, for instance, states that the president “shall take care that the laws be faithfully executed.” Some interpret this to mean that the president has a duty to comply with budgetary laws passed by Congress and to disburse funding in accordance with them. Article 1 Section 9, meanwhile, gives Congress the initial and sole authority to withdraw and appropriate funds from the national treasury.
Those close to Trump, however, take a different view.
“It is thus clear that Congress has the power to determine the amounts of budget authority to grant and the conditions under which public funds may be spent,” Trump administration director of the Office of Management and Budget Russell Vought wrote in a January 2021 memo.
“The Constitution does not end at Article I, however, and Congress’s Article I powers do not supersede the President’s own constitutional authorities, including his authorities as Commander-in-Chief and over foreign affairs, and his obligation to ‘take care that the laws be faithfully executed,’” Vought continued. “The President must faithfully execute all of the laws, and where those laws provide discretion or are ambiguous as to implementation, the Constitution grants the President exclusive authority to determine the best and most efficient manner in which to implement such laws.”
Faithful execution of the budgetary laws, per Vought and Trump’s allies, sometimes means reigning in what the executive views unnecessary, unconstitutional, harmful, or excessive spending. They also say the president has special discretion when dealing with expenditures related to diplomacy and defense.
Like Nixon before him, Trump has leaned on historical precedent to make the case for impoundment.
Indeed, former presidents from George Washington to Lyndon B. Johnson have utilized impoundment in a multitude of ways, and scholars are split on what to make of it.
Perhaps the most famous example of impoundment came in 1803 when former President Thomas Jefferson declined to spend $50,000 that Congress had appropriated to purchase 15 gunboats. Jefferson, who had secretly dispatched former President James Madison to negotiate with former French Emperor Napoleon I to buy the Louisiana Territory, did not want to provoke the French. Proponents of impoundment argue that Jefferson outright ignored congressionally approved spending for policy reasons, which is consistent with what Trump seeks to do. Critics, however, claim that the language of the appropriations bill, which provides for “a sum not exceeding fifty thousand dollars,” implied that Jefferson could spend $0 on boats and still comply with the law, making his actions not comparable to Trump’s.
Though Johnson made liberal use of impoundment, holding up appropriations for everything from a national aquarium to federal highways, everything changed when Nixon attempted a similar ploy a few years later to check the power of a hostile House and Senate.
In 1974, Congress passed the Impoundment Control Act to limit the power of Nixon and future executives in declining to spend congressionally appropriated funds. Among other things, the legislation made it such that if the president desired to pause spending set aside by Congress, he must send a request to the House and Senate Appropriations Committees. Those committees can then approve, disapprove, or ignore the request. If the request is ignored or denied, it’s dead in the water. If approved, the request goes to a full Congress for a vote, giving lawmakers 45 days to consider their decisions.
Spending freezes under the Impoundment Control Act can take two forms: rescissions and deferrals. Rescissions occur when funding is outright canceled, which covers much of what the Trump administration has done so far. Meanwhile, deferrals refer to temporary pauses in spending where the full amount would be paid out later within the same fiscal year, which is usually less controversial.
There are no reports of Trump having submitted recession or deferral requests to Congress regarding his administration’s cuts and freezes.
Since the Impoundment Control Act took effect, presidents have requested roughly $92 billion in spending rollbacks; only about $25 billion in deferrals or recessions have been approved.
Critics have long held that the Impoundment Control Act is unconstitutional, with some political operatives close to Trump holding that it incorrectly abridges the president’s powers as defined in Article 2 of the Constitution. Even some conservative legal minds, however, believe the constitutional case against the Impoundment Control Act is weak. While working as a lawyer in the Reagan White House, Chief Justice John Roberts wrote a memo denying that the president has a right to impoundment and defending the constitutionality of the Impoundment Control Act. Justice Brett Kavanaugh has also written to oppose impoundment.
“The Impoundment Control Act of 1974 is constitutional,” Prof. Entin told the Washington Examiner. “It makes clear that the president does not have unilateral authority to refuse to spend appropriated money even when he disagrees with the purposes for the expenditures. The president lacks a line-item veto, as the Supreme Court made clear in Clinton v. City of New York, and impoundment is effectively a line-item veto.”
Bobby Kogan, senior director of federal budget policy at the left-of-center Center for American Progress, also took a position against impoundment and in favor of the Impoundment Control Act.
“It’s not that you can’t impound because of the ICA,” Krogan said. “You can’t impound, period. You’ve never been able to legally impound except where Congress has explicitly granted authority to spend less … in fact, the ICA granted new impoundment power that didn’t exist before its enactment, in sections 1012 and 1013 of the act.”
Krogan cited multiple examples of the Nixon administration losing impoundment cases before the passage of the Impoundment Control Act to support his claim. If the courts overturn the Impoundment Control Act, which Krogan thinks is unlikely, it could have unintended consequences.
“It would also mean that the current mandates on some spending in various authorization, appropriations, and entitlement law are all unconstitutional,” he continued. “It would mean the states’ entitlement to Medicaid dollars is unconstitutional. It would mean individuals’ entitlement to [Supplemental Nutrition Assistance Program] benefits is unconstitutional. It would mean individuals’ entitlement to Social Security benefits is unconstitutional. It would mean the president may deliver those benefits, but that the president never has to because the part of law saying the president must deliver those funds is unconstitutional.”
Proponents of impoundment argue that it is inherent in the president’s constitutional powers and, therefore, any attempt to abridge it is unconstitutional.
“Interpreting the ICA in a manner so as to preclude all such temporary pauses would sanction a Legislative encroachment upon the President’s constitutional authority to faithfully execute the laws,” Vought and another Trump administration official wrote in 2021. “It is axiomatic that to faithfully execute the law, the President must be permitted to take time to consider how to best execute such spending within the confines of all applicable laws. If that requires a temporary pause in spending, it must be permitted.”
In February, Trump’s legal team, perhaps aware of Kavanaugh and Roberts’s opposition to impoundment, challenged the ability of federal judges to issue nationwide injunctions, suspending federal policy across the entire country pending legal review. In Department of State v. AIDS Vaccine Advocacy Coalition, for instance, a case brought by a small number of plaintiffs led to a federal judge ordering the State Department to “pay all invoices” for work completed before a given date, even for contractors not directly on the lawsuit.
Democratic and Republican administrations have criticized nationwide injunctions, along with some members of the Supreme Court. If the court ruled in favor of the Trump administration, it would have required contractors affected by spending cuts to sue the administration individually for relief.
With injunctions off the table, the Impoundment Control Act has become an attractive point of attack for the administration, though it remains to be seen exactly how they’ll approach it, if at all.
If all of Trump’s legal efforts fail but he decides to proceed with withholding funds anyway, Entin and Krogan agreed that courts could hold the president and his officials in contempt.
Krogan took a more aggressive view, arguing that administration officials responsible for holding back disbursements while under contempt could eventually face jail time until the funding is released.
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“To be sure, the president might be in contempt of such a ruling, but courts hesitate to hold public officials in contempt and undoubtedly would hesitate even more to hold the president in contempt than they would lesser officials,” Entin told the Washington Examiner.
The White House did not respond to a request for comment.
