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[House Hearing, 109 Congress]
[From the U.S. Government Publishing Office]

 
                THE CONSTITUTION AND THE LINE ITEM VETO

=======================================================================

                                HEARING

                               BEFORE THE

                    SUBCOMMITTEE ON THE CONSTITUTION

                                 OF THE

                       COMMITTEE ON THE JUDICIARY
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED NINTH CONGRESS

                             SECOND SESSION

                               __________

                             APRIL 27, 2006

                               __________

                           Serial No. 109-102

                               __________

         Printed for the use of the Committee on the Judiciary

      Available via the World Wide Web: http://judiciary.house.gov

                                 ______

                    U.S. GOVERNMENT PRINTING OFFICE
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_____________________________________________________________________________
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                       COMMITTEE ON THE JUDICIARY

            F. JAMES SENSENBRENNER, Jr., Wisconsin, Chairman
HENRY J. HYDE, Illinois              JOHN CONYERS, Jr., Michigan
HOWARD COBLE, North Carolina         HOWARD L. BERMAN, California
LAMAR SMITH, Texas                   RICK BOUCHER, Virginia
ELTON GALLEGLY, California           JERROLD NADLER, New York
BOB GOODLATTE, Virginia              ROBERT C. SCOTT, Virginia
STEVE CHABOT, Ohio                   MELVIN L. WATT, North Carolina
DANIEL E. LUNGREN, California        ZOE LOFGREN, California
WILLIAM L. JENKINS, Tennessee        SHEILA JACKSON LEE, Texas
CHRIS CANNON, Utah                   MAXINE WATERS, California
SPENCER BACHUS, Alabama              MARTIN T. MEEHAN, Massachusetts
BOB INGLIS, South Carolina           WILLIAM D. DELAHUNT, Massachusetts
JOHN N. HOSTETTLER, Indiana          ROBERT WEXLER, Florida
MARK GREEN, Wisconsin                ANTHONY D. WEINER, New York
RIC KELLER, Florida                  ADAM B. SCHIFF, California
DARRELL ISSA, California             LINDA T. SANCHEZ, California
JEFF FLAKE, Arizona                  CHRIS VAN HOLLEN, Maryland
MIKE PENCE, Indiana                  DEBBIE WASSERMAN SCHULTZ, Florida
J. RANDY FORBES, Virginia
STEVE KING, Iowa
TOM FEENEY, Florida
TRENT FRANKS, Arizona
LOUIE GOHMERT, Texas

             Philip G. Kiko, General Counsel-Chief of Staff
               Perry H. Apelbaum, Minority Chief Counsel
                                 ------                                

                    Subcommittee on the Constitution

                      STEVE CHABOT, Ohio, Chairman

TRENT FRANKS, Arizona                JERROLD NADLER, New York
WILLIAM L. JENKINS, Tennessee        JOHN CONYERS, Jr., Michigan
SPENCER BACHUS, Alabama              ROBERT C. SCOTT, Virginia
JOHN N. HOSTETTLER, Indiana          MELVIN L. WATT, North Carolina
MARK GREEN, Wisconsin                CHRIS VAN HOLLEN, Maryland
STEVE KING, Iowa
TOM FEENEY, Florida

                     Paul B. Taylor, Chief Counsel

                      E. Stewart Jeffries, Counsel

                          Hilary Funk, Counsel

                 Kimberly Betz, Full Committee Counsel

           David Lachmann, Minority Professional Staff Member

                            C O N T E N T S

                              ----------                              

                             APRIL 27, 2006

                           OPENING STATEMENT

                                                                   Page
The Honorable Steve Chabot, a Representative in Congress from the 
  State of Ohio, and Chairman, Subcommittee on the Constitution..     1
The Honorable Jerrold Nadler, a Representative in Congress from 
  the State of New York, and Ranking Member, Subcommittee on the 
  Constitution...................................................     2
The Honorable Tom Feeney, a Representative in Congress from the 
  State of Florida, and Member, Subcommittee on the Constitution.     4
The Honorable Robert C. Scott, a Representative in Congress from 
  the State of Virginia, and Member, Subcommittee on the 
  Constitution...................................................     4

                               WITNESSES

The Honorable Paul Ryan, a Representative in Congress from the 
  State of Wisconsin
  Oral Testimony.................................................     6
  Prepared Statement.............................................     8
The Honorable Mark Kennedy, a Representative in Congress from the 
  State of Minnesota
  Oral Testimony.................................................    11
  Prepared Statement.............................................    12
Ms. Cristina Martin Firvida, Senior Counsel, National Women's Law 
  Center
  Oral Testimony.................................................    13
  Prepared Statement.............................................    15
Mr. Charles J. Cooper, Partner, Cooper and Kirk, PLLC
  Oral Testimony.................................................    20
  Prepared Statement.............................................    22

                         THE CONSTITUTION AND 
                           THE LINE ITEM VETO

                              ----------                              

                        THURSDAY, APRIL 27, 2006

                  House of Representatives,
                  Subcommittee on the Constitution,
                                Committee on the Judiciary,
                                                    Washington, DC.
    The Subcommittee met, pursuant to notice, at 2:07 p.m., in 
Room 2141, Rayburn House Office Building, the Honorable Steve 
Chabot (Chairman of the Subcommittee) presiding.
    Mr. Chabot. The Committee will come to order. This is the 
Subcommittee on the Constitution and we welcome everyone here 
this afternoon for our oversight hearing on ``The Constitution 
and the Line Item Veto.''
    We face serious budget problems. Congress is simply 
spending too much money. Our national debt is now $8.3 
trillion, with hundreds of billions being added every year. 
That future--future generations of Americans will have to pay 
for this debt that continues to be built up. Fiscal sanity, the 
simple common sense process of not spending more than you take 
in, must be restored in Washington and we need to balance the 
budget.
    We also need reform measures, such as the Stop Omnibus Pork 
Bill that I happen to have introduced to prohibit the bundling 
together of appropriations bills that leads to deficits. I and 
many others are committed to stopping this spending and the 
line item veto is a very good first start.
    The notion of a line item veto has intrigued those 
concerned with wasteful Federal spending for a long time. 
Presidents at least since Thomas Jefferson have asserted that 
the Executive has some discretion in the expenditure of monies 
appropriated by Congress. Forty-three governors have some form 
of line item veto to reduce spending. Yet until 1996, no such 
mechanism existed at the Federal level.
    In that year, Congress enacted the Line Item Veto Act, of 
which I happened to be a cosponsor, with overwhelming 
bipartisan support. However, the United States Supreme Court 
ultimately held that the Line Item Veto Act was 
unconstitutional because it gave the President the power to 
rescind a portion of a bill as opposed to an entire bill, as he 
is authorized to do by article I, section 7 of the 
Constitution.
    Despite the Supreme Court's actions, the notion of the line 
item veto has remained very popular. During its brief life, 
President Clinton used the line item veto to cut 82 projects 
totaling nearly $2 billion. President Bush has repeatedly 
requested that Congress enact a legislative line item veto and 
for the first time has submitted a specific legislative 
proposal. President Bush's proposal has been warmly received by 
such disparate editorial boards as the Washington Post and the 
Wall Street Journal.
    That proposal embodied in H.R. 4890, introduced by 
Representative Paul Ryan, of which I happen to also be a 
cosponsor, would give the President the authority to recommend 
to Congress that it rescind certain dollar amounts of 
discretionary budget authority or any item of direct spending. 
The bill provides for certain expedited procedures to take up 
such rescission bills. The President may withhold the spending 
of those funds for a period of no more than 180 days. However, 
only Congress can pass a bill that will rescind the initial 
spending measures. If Congress does not act, the spending 
provision will still remain law.
    As disappointed as many of us were with the Supreme Court's 
ruling on the original line item veto, many of us are heartened 
to see that Chuck Cooper, who argued to the Court that the 1996 
law was unconstitutional, is testifying today that this bill 
is, in his opinion, in fact, constitutional.
    However, despite Mr. Cooper's support, some have argued 
that provisions in this bill could potentially be abused by a 
President and, as such, raise certain separation of powers 
concerns. I know that we all look forward to hearing from all 
of our witnesses on how these concerns can be addressed.
    We also look forward to the testimony of Congressman Mark 
Kennedy, who has introduced a constitutional amendment to give 
the President the authority to reduce or disapprove any 
appropriation. Congress could override the veto in the manner 
prescribed in Article I, Section 7 of the Constitution. This 
proposal, if enacted, would be clearly constitutional and would 
give the President the authority to directly disapprove of 
specific spending requests.
    Again, we want to welcome all of our witnesses and look 
forward to hearing all your views on how Congress can 
effectively address its problems with rampant spending.
    And at this time, I would like to yield 5 minutes to the 
gentleman from New York, Mr. Nadler, the Ranking Member of this 
Committee.
    Mr. Nadler. Thank you, Mr. Chairman. I want to join you in 
welcoming our witnesses and especially our distinguished 
colleagues. Any proposed legislation that would so radically 
alter the balance of power between two branches of Government 
deserves close scrutiny by our Subcommittee. The Supreme Court 
has already struck down the line item veto and I think Members 
should think long and hard about the constitutional issues as 
well as the institutional issues.
    I have to admit, I was a little incredulous when I saw the 
subject of the hearing. Didn't the Supreme Court settle this 
issue in 1998? But this is no laughing matter. The fact is that 
this Republican Congress and this Republican President have the 
unenviable distinction of having taken record surpluses and 
turned them into record deficits in record time. The Congress 
and President Clinton made hard and sometimes unpopular 
budgetary choices and tackled the deficit. We have started to 
tackle the national debt. If you recall the debate in the 2000 
campaign was how are we to deal with the anticipated $5.6 
trillion budget surplus over the next 10 years. They were 
talking about paying off the entire national debt. So we know 
it can be done if there is the political will.
    Now, this Republican Congress and this Republican President 
have become spending maniacs and tax-cutting people, and when 
you combine huge tax cuts, mostly for rich people, with 
maniacal spending, you get huge deficits. Surprise. But it is 
not a constitutional question, it is a question of political 
will.
    And talking about political will, why should we give a 
President a line item veto when he never uses the regular veto? 
I would suggest that it is political will and perhaps political 
courage that is lacking, not a line item veto.
    The fault of your colleagues is not in our laws but in 
ourselves. The line item veto, like the balanced budget 
amendment, is an admission on the part of its supporters that 
they are incapable of doing the job they were sent here to do. 
Instead, we are told we need some gimmick to force us to do 
what we are unwilling to do ourselves. We lied to the public 
about our intentions. We tell them that we can have huge tax 
cuts and not cut the budget too much, and then we act shocked 
when there is a huge deficit.
    Even if the line item veto would really have a substantive 
effect on the deficit, and all evidence indicates it will not, 
it is plainly unconstitutional and it will, if somehow upheld, 
break down the checks and balances between the branches of our 
Government which have preserved our freedom. The threat of a 
line item veto would give a President even greater ability to 
coerce Members of Congress into supporting his pet legislation 
or his pet spending priorities. If you think the arm twisting 
during the vote on the Medicare prescription drug benefit, for 
example, was a scandal, and it was a scandal according to the 
Ethics Committee, that will be nothing when compared with the 
stick we would be handing this and future Presidents. You vote 
for my bill to do this and that or I will veto everything in 
your district.
    Rather than destroying our system of Government and making 
the Executive more powerful, which is essentially what the line 
item veto would do, I would encourage my colleagues to resolve 
here and now to do our jobs correctly. You blew the Nation's 
nest egg--you Republicans. We are now in hock to the Chinese. 
We are still arguing over whether to do something about the oil 
industry's ridiculously enviable tax situation, all those extra 
tax breaks we voted them last year because they're not making 
enough money. I am sure the American people will forgive you if 
you admit you blew it and turn over a new leaf.
    I have a rather unusual perspective on earmarks. When I 
first came to Congress, I tried to kill an egregious earmark in 
my own district, a proposal to tear down a highway that had 
recently been rebuilt to move it a few yards inland and to bury 
it to accommodate the needs of a private developer, Mr. Trump. 
Senator Roth, take note. I was not successful. Let me repeat 
that. I was not successful.
    Although I opposed the earmark on the floor of the House, I 
was not successful in stopping it, even though the vast 
majority of my constituents did not want this outrageous waste 
to go forward. In the end, the Republican majority, at the 
behest of a Republican Member, who was not even from New York 
City but for whom the developer, Mr. Trump, had held a 
fundraiser, put this outrage back into the budget. What is this 
world coming to when you can't even kill a pork barrel project 
in your own district?
    With that, Mr. Chairman, I want to welcome our witnesses. I 
want to repeat that the fault is not in the stars, not in the 
lack of a line item veto, but in ourselves and in the 
President. I look forward to the testimony of the witnesses, 
although I must say I think this hearing entirely unnecessary 
because we know all the answers. We know this is ridiculous, 
and I yield back the balance of my time.
    Mr. Chabot. Thank you. As you can see, we try to avoid 
getting political in this Committee. [Laughter.]
    Are there any other Committee Members that wish----
    Mr. Nadler. Mr. Chairman, can I comment on that briefly?
    Mr. Chabot. Of course.
    Mr. Nadler. Let me say that the Judiciary Committee is a 
very political and a very ideological Committee. The other 
Committee I serve on, the Transportation Committee, is also a 
very ideological Committee, but the ideology is a different 
nature. Instead of debating abortion or gay rights or line item 
vetoes, the ideology is more money for my State, less money for 
yours, but that's the other Committee. [Laughter.]
    Mr. Chabot. Are there any other Members who would like to 
make a brief statement? Any on this side? Mr. Feeney, you are 
recognized for 5 minutes.
    Mr. Feeney. Yes, just briefly. I want to thank our 
panelists. I'm really looking forward to this discussion. I 
worked closely with Congressman Kennedy and Congressman Ryan 
and both of them, I think, have recognized that there is a 
problem. Mr. Nadler says it's all one party. I'd suggest that 
the other party's problems have been infinitely worse 
historically.
    But he does make a point. The culture and the organization 
of Congress rewards spending and irresponsible behavior, and 
not just on this issue, but on a host of other reforms. People 
like Congressman Kennedy, especially Paul Ryan, have been 
leaders to try to change our organization, to change our rules 
and change our culture. This is one part of that that I really 
am grateful that you're here today.
    Mr. Chabot. Thank you very much.
    The gentleman from Virginia would like to make a statement, 
is that correct?
    Mr. Scott. Yes. Yes, Mr. Chairman, just very briefly. I 
hope as we discuss this line item veto we discuss it in terms 
of esoteric constitutionality and not by anything that is going 
to do anything about the budget.
    This chart shows the budget deficit over the last few 
years. It shows that we don't need this thing to balance the 
budget. We did that during the 8 years of President Clinton. 
And you have to show the chart, because if I tried to use an 
adjective to describe what happened to the budget when this 
Administration came in, no one would believe the adjective. You 
would assume that I was just exaggerating, but let this chart, 
as they say at the poker table, let the cards speak for 
themselves.
    The deterioration in the budget has been from January 2001, 
we projected the next 10 years, $5.6 trillion surplus. Now, 
after we have messed up the budget, those same 10 years are 
going to come in at a $3.2 trillion deficit, a swing of $8.8 
trillion.
    Now, if we are talking earmarks, let's talk earmarks. I 
understand you might have $20 billion a year in earmarks. 
Twenty billion a year, $8.8 trillion, well, 10 percent of $8.8 
trillion would be $800 billion. One percent would be $88 
trillion [sic]. I mean, you are into minuscule percentage of 
the $8.8 trillion deterioration.
    Now, you keep talking about eliminating a couple of little 
pork projects. You don't talk about tax cuts. You ought to be 
able to strike some of those out, because this blue line is 
expenditures. The red line is taxes. You notice that toward the 
end of the Clinton administration, we got the red line revenues 
above the blue line expenditures. The red line revenues went 
above the expenditures. We had a surplus. The revenues have 
collapsed. The spending has still gone up, and that is the 
problem, but you don't have anything in here where you can 
whack a tax cut. You just talk about the spending, which had 
gotten under control, so that's not--you don't have anything in 
there for that.
    Now, if you want to balance a budget next year, this is the 
cost of the tax cuts for the first couple of years, and the 
reason you are having trouble with this year's budget is the 
fifth year, you all of a sudden had to incorporate this year 
into your 5-year budget, which means you've got to find about 
$150 billion more. Next year, you've got to find another $100 
billion to deal with your budget next year. This little line 
item veto isn't going to be able to deal with that at all.
    If you want to find $20 billion, here is a tax cut, a 
couple of tax cuts, I think, can find it. This is the chart, 
standard deduction and itemized deductions, when fully phased 
in, who gets the $20 billion. If you are a millionaire, you get 
$20,000 of it. Two-hundred-thousand to $500,000, you get a 
couple of hundred. On average, $75,000 to $100,000, you get 
about ten cents a week. And under $75,000, on average, you 
don't get anything. So if you are looking for $20 billion, 
which happens to be more than all the earmarks all together, 
this would be a place to look at it.
    This just shows debt held by foreigners and foreign 
countries, what happens to the debt. That little black line 
there is we are going to pay off the debt by about 2013, the 
whole national debt, at the rate we are going. But instead, we 
are skyrocketing out of control with foreign debt.
    Line item veto won't have anything to do with any of this, 
and I would hope, Mr. Chairman, that we would keep that in 
perspective as we discuss the esoterics of the line item veto.
    Mr. Chabot. Are there any other Members that wish to make 
an opening statement? If not, we will go ahead and get to our 
panel here, then.
    We welcome the panel very much for their coming forward 
this afternoon. In fact, I would also like to preface that by 
saying, without objection, all Members will have 5 legislative 
days to submit additional materials for the hearing record.
    Our first witness this afternoon will be Congressman Paul 
Ryan, who represents Wisconsin's First Congressional District. 
Representative Ryan is the sponsor of H.R. 4890, the 
``Legislative Line Item Veto Act of 2006,'' which has 101 
cosponsors, including many Members of this Committee. We 
welcome you here this morning, Congressman.
    Our second witness is Congressman Mark Kennedy, who 
represents the Sixth Congressional District of Minnesota. 
Representative Kennedy has introduced H.J. Res. 71, a 
constitutional amendment that would give the President the 
authority to reduce or disapprove any appropriation made by 
Congress, and we welcome you here this afternoon, Congressman 
Kennedy.
    Our third witness is Ms. Cristina Martin Firvida, am I 
pronouncing that right? Thank you. She is a Senior Counsel at 
the National Women's Law Center, where she focuses on Federal 
tax and budget policy. Ms. Firvida is a graduate of Yale 
University and Cornell Law School. We welcome you here this 
afternoon.
    Our fourth and final witness is Mr. Chuck Cooper, who is a 
partner at Cooper and Kirk. Mr. Cooper has had a long and 
distinguished career, including a stint as the Assistant 
Attorney General of the Office of Legal Counsel of the 
Department of Justice under President Reagan. Mr. Cooper also 
had the distinction of representing the plaintiffs in the two 
suits that challenged the constitutionality of the 1996 Line 
Item Veto Act.
    Again, we welcome you all here this afternoon. I would draw 
your attention to the two boxes there. I know the Members are 
very familiar with that. We have what's called the 5-minute 
rule. We'd ask you to keep your testimony within that time. The 
lights sort of help us to make that happen. The green light 
will be on for 4 minutes. The yellow light will be on 1 minute. 
The red light means you're supposed to wrap it up. I won't cut 
you off immediately, but we hope that you would try to stay 
within the confines of those rules if at all possible.
    And finally, it's the practice of this Committee to swear 
in all witnesses, including Members of Congress, who appear 
before us, so if you would all stand, please, and raise your 
right hands.
    Do you each swear that in the testimony that you are about 
to give, you will tell the truth, the whole truth, and nothing 
but the truth, so help you, God?
    Mr. Ryan. I do.
    Mr. Kennedy. I do.
    Ms. Firvida. I do.
    Mr. Cooper. I do.
    Mr. Chabot. All witnesses have indicated in the 
affirmative, including the Members of Congress.
    We appreciate your testimony here this afternoon, and 
Congressman Ryan, you are recognized for 5 minutes.

   TESTIMONY OF THE HONORABLE PAUL RYAN, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF WISCONSIN

    Mr. Ryan. Thank you, Chairman, and Mr. Nadler, it is nice 
to be with you today. I serve on Ways and Means and the Budget 
Committee and I thought for a moment after hearing the opening 
speeches I was in one of those two Committees. We have similar 
dialogues taking place in those Committees. I will try and be 
brief, and if I could have my written testimony submitted to 
the record, I'd appreciate that.
    Mr. Chabot. Without objection.
    Mr. Ryan. I introduced this bill on March the Seventh. We 
have 102 bipartisan cosponsors, including four prominent ``Blue 
Dog'' Democrats. In 2004, I offered this as an amendment with 
my Democrat sponsor at the time, Charlie Stenholm of Texas. We 
received 174 votes on the House floor, including 45 Democrats. 
In the Senate, this bill has 29 bipartisan cosponsors, 
including the lead Democrat sponsor, Senator Kerry.
    What this bill does is it provides the President with the 
authority to single out wasteful spending items and, to Mr. 
Scott's question, narrow special interest tax breaks included 
in legislation that the President signs into law and sends 
these specific items back to Congress.
    I'm very excited that we have Mr. Cooper with us here 
today, who argued the Clinton v. New York case. Unlike the line 
item veto authority provided in 1996 to President Clinton, this 
one is constitutional because it brings the power back to 
Congress. It preserves the separation of powers and the 
presentment--and it conforms with the Presentment Clause 
because this is like an expedited rescissions process whereby 
the President can single out and pull out individual items, but 
that's not the end of the process like it was with the earlier 
line item veto. The President then sends it back to Congress 
and both Houses have--within a short period of time have to act 
on it and vote on it. If Congress chooses to rescind, then it 
is rescinded. If they choose not to rescind the particular 
program, then it is funded.
    Now, I agree with the Supreme Court ruling in 1996. I 
wasn't in Congress at the time, but I agree with that Supreme 
Court ruling. I do believe Mr. Cooper was right in his 
arguments at the time. But just as that legislation was 
unconstitutional, I believe this particular piece is 
constitutional.
    Let me tell you why we are proposing this. We are proposing 
this because earmarks have gotten out of control, because 
wasteful spending is getting out of control. And I am a 
Republican saying this. Last year, according to Citizens 
Against Government Waste, the FY 2006 budget included nearly 
10,000 pork barrel spending items at a total cost of $29 
billion to taxpayers. That is not small change no matter what 
numbers you are looking at. This is a significant increase over 
the last 10 years, where 10 years ago the number was set at $2 
billion.
    Now, many of these spending projects are inserted at the 
end of the process. The reason why I think this is so important 
is because we do have a level of accountability and 
transparency at the beginning of the tax and spending process. 
Members can go to the floor with amendments and try and go 
after things. Mr. Nadler had that opportunity to go after that 
pork project in his district. He was outvoted, but he had the 
opportunity to go after it.
    Where we don't have that level of transparency and 
accountability is at the end of the process, at the conference 
report level. Typically, a lot of these provisions get inserted 
in the conference report in the conference. What do we have as 
Members of Congress the choice to do? We can vote up or down on 
the entire piece of legislation. That's it. What option does 
the President have? He or she can vote or can veto the entire 
bill or sign the entire bill. So it is at that end of the 
spending and taxing process where we don't have much 
transparency. We don't have enough accountability, I would 
argue. This restores that.
    Now, what's important when you think of all these things is 
what effect will this have? I believe this will have a couple 
of effects. Number one, it will have us go after the truly 
egregious items that can't stand a full vote by Congress. 
Number two, I think it's going to embarrass a lot of things out 
of these bills in the first place. That will save money.
    Now, what is the process? Here is exactly how we envision 
this process. The President signs a bill into law, a tax bill, 
spending bill, and it could be authorization or appropriations, 
like a transportation bill or an appropriation bill. He sends a 
recission request down to Congress, where the leadership of 
both the House and the Senate have the opportunity to introduce 
a bill to pass it into law. If neither leadership introduces 
the bill after 2 days, on the third day, any Member of the 
House or the Senate can introduce a bill to approve the 
recission request. The bill must be reported out of the 
appropriate Committee within 5 days without any significant 
changes, and within 10 days of its original introduction, it 
must be given an up or down vote on the floor with debate set 
so you don't have a filibuster issue. All that is required to 
pass or defeat the recission is a simple majority.
    So what this does is it has Congress inserted at the end of 
the process, as well. Congress has the final say so. Separation 
of powers is maintained. The Presentment Clause is conformed 
with. That is why I decided to do it this way. I have been 
pushing this version since I've been elected to Congress. 
Traditionally, we call these enhanced decisions.
    Why is it necessary? Because the rescission process we have 
today is virtually meaningless because the President, no matter 
who the President is, can send a rescission request to Congress 
and Congress doesn't have to do anything. They can virtually 
ignore--they can ignore the recission request. This forces us 
to act on these requests, but it gives us the power to make the 
final decision.
    I will conclude with this. I have asked for comment from 
various interested parties. We have gotten a lot of good 
comments and criticisms to which I think we can address in this 
bill to satisfy some of the concerns from constitutionalists 
and others, and I'd be happy to answer those questions during 
the time of questions.
    I thank the Committee for this very important hearing.
    Mr. Chabot. Thank you very much.
    [The prepared statement of Mr. Ryan follows:]

Prepared Statement of the Paul Ryan, a Representative in Congress from 
                         the State of Wisconsin

    Chairman Chabot, Ranking Member Nadler, and Members of the 
Subcommittee, thank you for the opportunity to testify before you today 
on H.R. 4890, the Legislative Line-Item Veto Act of 2006. This 
legislation would help the President and Congress work together to 
reduce our budget deficit by providing the President with the authority 
to single out wasteful spending items and narrow special-interest tax 
breaks included in legislation that he signs into law and send these 
specific items back to Congress for a timely vote. Unlike the line-item 
veto authority provided to President Clinton in 1996, H.R. 4890 is 
constitutional because it requires an up-or-down vote in both chambers 
of Congress under an expedited process in order to effectuate the 
President's proposed rescissions. It is important that Congress act now 
to give the President this tool to bring greater transparency, 
accountability and a dose of common sense to the federal budget 
process.

                              THE PROBLEM:

    The amount of pork-barrel spending included in the federal budget 
continues to increase every year. According to Citizens Against 
Government Waste (CAGW), the federal government spent $29 billion on 
9,963 pork-barrel projects in Fiscal Year 2006 (FY 2006), an increase 
of 6.3% from 2005, and an increase of over 900% since 1991. Overall, 
the federal government has spent $241 billion on pork-barrel projects 
between 1991 and 2005, an amount greater than two-thirds of our entire 
deficit in FY 2005. This includes irresponsible spending on items such 
as the $50 million Rain Forest Museum in Iowa; $13.5 million to pay for 
a program that helped finance the World Toilet Summit; and $1 million 
for the Waterfree Urinal Conservation Initiative.
    Many of these pork-barrel spending projects are quietly inserted 
into the conference reports of appropriations bills where Congress is 
unable to eliminate them using the amendment process. In fact, the only 
time that Congress actually votes on these items is during an up-or-
down vote on the entire conference report, which includes spending for 
many essential government programs in addition to the pork-barrel 
earmarks. In this situation, it is very difficult for any Member to 
vote against an appropriations bill that, as an overall package, may be 
quite meritorious, despite the inclusion of wasteful spending items.
    Unfortunately, the current tools at the President's disposal do not 
enable him to easily combat these wasteful spending items either. Even 
if the President identifies numerous pork-barrel projects in an 
appropriations bill, he is unlikely to use his veto power because it 
must be applied to the bill as a whole and cannot be used to target 
individual items. This places the President in the same dilemma as 
Members of Congress. Does he veto an entire spending bill because of a 
few items of pork when this action may jeopardize funding for our 
troops, for our homeland security or for the education of our children?
    The President's ability to propose the rescission of wasteful 
spending items under the Impoundment Control Act of 1974 has been 
equally ineffective at eliminating wasteful spending items. The problem 
with the current authority is that it does not include any mechanism to 
guarantee congressional consideration of a rescission request and many 
Presidential rescissions are ignored by the Congress. In fact, during 
the 1980's, Congress routinely ignored President Reagan's rescission 
requests, failing to act on over $25 billion in requests that were made 
by the Administration. The historic ineffectiveness of this tool has 
deterred Presidents from using it with any regularity.

   SUMMARY OF H.R. 4890, THE LEGISLATIVE LINE-ITEM VETO ACT OF 2006:

    I introduced H.R. 4890, the Legislative Line-Item Veto Act of 2006, 
on March 7, 2006. This legislation, which currently has the support of 
101 bipartisan cosponsors in the House, is based on the 
Administration's proposal to provide line-item veto authority to the 
President and is the product of discussions that I and my congressional 
colleagues have had with the White House since the President announced 
his intent to seek line-item veto authority in the State of the Union 
Address on January 31, 2006.
    The Legislative Line-Item Veto Act is very similar to an expedited 
rescissions amendment that I offered during the consideration of H.R. 
4663 on June 24, 2004, with my former colleague Representative Charlie 
Stenholm, a Democrat from Texas. Like H.R. 4890, this amendment would 
also have allowed the President to propose the elimination of wasteful 
spending items subject to congressional approval under an expedited 
process. Although this amendment failed to pass the House, it attracted 
the support of 174 Members of Congress, including 45 Democrats. A 
similar provision is also included in Section 311 of the Family Budget 
Protection Act, legislation that I introduced along with Congressman 
Jeb Hensarling of Texas, Congressman Chris Chocola of Indiana, and 
former Congressman Christopher Cox of California during 2004 and again 
in 2005.
    If passed, H.R. 4890 would give the President the ability to put on 
hold wasteful discretionary spending, wasteful new mandatory spending, 
or new special-interest tax breaks (those that affect less than 100 
beneficiaries) after signing a bill into law. The President could then 
ask Congress to rescind these specific items. The requirement that both 
the House and Senate approve all proposed rescissions means that 
Congress will continue to control the power of the purse and will have 
the final word when it comes to spending matters. However, unlike the 
current rescission authority vested in the President under the 
Impoundment Control Act of 1974, the bill also includes a mechanism 
that would virtually guarantee congressional action in an expedited 
time frame.
    Using the Legislative Line-Item Veto, the President and Congress 
will be able to work together to combat wasteful spending and add 
transparency and accountability to the budget process. This tool will 
shed light on the earmarking process and allow Congress to vote up or 
down on the merits of specific projects added to legislation or to 
conference reports. Not only will this allow the President and Congress 
to eliminate wasteful pork-barrel projects, but it will also act as a 
strong deterrent to the addition of questionable projects in the first 
place. On the other hand, Members who make legitimate appropriations 
requests should have no problem defending them in front of their 
colleagues if they are targeted by the President. With H.R. 4890, we 
can help protect the American taxpayer from being forced to finance 
wasteful pork-barrel spending and ensure that taxpayer dollars are only 
directed toward projects of the highest merit.
    The process under H.R. 4890 would begin with the President 
identifying an item of wasteful spending or a special-interest tax 
break in legislation that is being signed into law. The President would 
then submit a special message to Congress, asking for Congress to 
rescind this wasteful item or items. House and Senate leadership would 
have the opportunity to introduce the President's rescission requests 
within two days following receipt of the President's message. After 
that time period, any Member of Congress would be able to introduce the 
President's rescission proposal, virtually guaranteeing congressional 
action. Once the bill is introduced, it would be referred to the 
appropriate committee, which would then have five days to report the 
bill without substantive revision. If the committee fails to act within 
that time period, the bill would be automatically discharged to the 
floor. The bill would have to be voted on by the full House and Senate 
within 10 legislative days of its introduction, with a simple majority 
required for passage.
    Since introducing H.R. 4890, I have received substantial feedback 
from interested Members of Congress on ways to improve the legislation 
to ensure that it best meets its intent of controlling federal spending 
while keeping the power of the purse squarely in the legislative 
branch. Among the changes that I think may improve the legislation are 
the following: limiting the time period available to the President to 
make a rescission request after signing a bill into law; limiting the 
number of rescission requests that can be made for each piece of 
legislation signed into law; allowing for the bundling of rescission 
requests; explicitly prohibiting duplicative requests; and tightening 
the language that allows the Administration to defer spending while a 
rescission request is being considered by Congress. These changes will 
strengthen the bill and better ensure that the legislative branch 
retains all of the powers delegated to it by our founding fathers. I am 
committed to continuing to work with my colleagues in Congress and the 
Administration throughout the legislative process to make sure that 
H.R. 4890 is narrowly drafted in order to best achieve its goals.

                         CONSTITUTIONAL ISSUES:

    H.R. 4890 passes constitutional muster because it requires both the 
House and Senate to pass rescission legislation and send it to the 
President for his signature before the rescissions become law. In 
Clinton v. City of New York, the U.S. Supreme Court held that the line-
item veto authority provided to President Clinton in 1996 violated the 
Presentment Clause of the U.S. Constitution (Article I, Section 7, 
Clause 2), which requires that ``every bill which shall have passed the 
House of Representatives and the Senate, shall, before it become a Law, 
be presented to the President of the United States.'' The problem with 
this version of the line-item veto was that the President's requested 
rescissions would become law by default if either the House or Senate 
failed to enact a motion of disapproval to stop them from taking 
effect. The lower court in Clinton v. City of New York also held that 
this version of the line-item veto upset the balance of power between 
the executive and legislative branches. Unlike the 1996 line-item veto 
legislation, H.R. 4890 leaves Congress in the middle of the process 
where it belongs and follows the procedure and balance of power 
outlined in our Constitution.
    H.R. 4890 also withstands constitutional scrutiny under the U.S. 
Supreme Court's holding in I.N.S. v. Chadha. In I.N.S. v. Chadha, the 
Supreme Court invalidated part of the Immigration and Nationality Act 
that allowed a single house of Congress to override immigration 
decisions made by the Attorney General. The Legislative Line-Item Veto 
Act of 2006 is consistent with this holding because the President's 
authority to defer funds would not explicitly be terminated by the 
disapproval of a proposed rescission by one of the houses of Congress.
    I agree with the Supreme Court's rulings in Clinton v. City of New 
York and I.N.S. v. Chadha. It is extremely important that Congress does 
not cede its law-making power to the President. I believe that this 
violates the Separation of Powers in addition to the Presentment 
Clause. In contrast, H.R. 4890 would withstand constitutional scrutiny 
because it requires both houses of Congress to act on any rescission 
request and for this legislation to be sent back to the President for 
his signature.

                              CONCLUSION:

    In 2006, the federal government will once again rack up an annual 
budget deficit of over $300 billion, and our debt is expected to 
surpass $9 trillion. Meanwhile, the retirement of the baby boom 
generation looms on the horizon, threatening to severely exacerbate 
this problem. Given these dire circumstances, it is essential that we 
act now to give the President all of the necessary tools to help us get 
our fiscal house in order. By providing the President with the scalpel 
he needs to pinpoint and propose the elimination of wasteful spending, 
H.R. 4890 takes an important first step toward achieving this goal.

    Mr. Chabot. Congressman Kennedy, you are recognized for 5 
minutes.

 TESTIMONY OF THE HONORABLE MARK KENNEDY, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF MINNESOTA

    Mr. Kennedy. Mr. Chairman, Ranking Member, as someone who 
spent 20 years in the business world before coming to Congress, 
I understand that really for any organization to be successful, 
it needs to have leadership that establishes priorities. The 
owners of the businesses big and small know this. But over the 
past couple of decades, Congress has decided it follows a 
different set of rules.
    You don't have to look any further than the proliferation 
of earmarks, which have grown from 958 in fiscal year 1996 to 
nearly 14,000 in fiscal year 2005. There are many egregious 
examples, whether it be the $2 million relocating a kitchen in 
Fairbanks, Alaska, or the $950,000 for the Please Touch Museum 
in Philadelphia, or the $150,000 for the Therapeutic Horseback 
Riding Program at the Lady B Ranch in California.
    These no longer come as a surprise to us, unfortunately, so 
we shouldn't be surprised that in FY 06, spending is projected 
to reach an all-time high of $23,638 per U.S. household, of 
which $3,800 is being borrowed.
    All of this uncontrolled spending on non-necessities has 
led to a budget deficit that is simply at unsustainable 
proportions. That's why I introduced H.J. Res. 71, the Line 
Item and Reduction Veto Amendment. This constitutional 
amendment would provide a President with a proven mechanism to 
cut the junk out of spending bills.
    My bill would restore the same authority that was provided 
to President Clinton in the 1996 Line Item Veto Act. This 
authority already is held by 40 governors, was used by 
President Clinton a total of 82 times to get those nice numbers 
that Bobby was talking about, in part, and produced savings of 
nearly $2 billion before it was ruled unconstitutional by the 
Supreme Court on June 25, 1998.
    Both Representative Ryan's bill and my constitutional 
amendment would make a significant step toward restoring fiscal 
sanity to the Federal budget. I happen to believe a 
constitutional amendment is the stronger approach because it 
eliminates any question of the constitutionality of a line item 
and will halt another round of time consuming separation of 
powers lawsuits. While Congress may be able to address the 
concerns in Ryan's bill, my legislation, which mirrors 
constitutional authority held by governors across the country, 
offers a clear and decisive answer free of tinkering from 
activist judges.
    A line item veto in any workable form will help restore 
some sorely needed fiscal discipline to Washington, but I 
believe more needs to be done. I believe we must go further and 
look at other tried and true measures, including the 
restoration of Presidential impoundment authority. This 
authority was used by Presidents for almost two centuries and 
it reduced excessive spending by simply deciding not to spend 
when there is a questionable value. President Jefferson was the 
first to use an impoundment authority when he--and it was used 
by FDR in World War II to block Congressional spending he 
determined, quote, ``interferes with the defense program by 
diverting manpower and materials,'' unquote.
    Unfortunately, the 1974 Congressional Budget and 
Impoundment Control Act not only stripped the executive branch 
of constitutional authority to impound or reduce spending, but 
with no one to guard the cookie jar, Congress's appetite has 
increased, including items that are not national priorities, 
relating to more waste and larger Government.
    Mr. Chairman, after adjusting for inflation, since the 1974 
act was enacted into law, our Federal debt has grown by over 
1,600 percent. As perhaps the only former chief financial 
officer serving in Congress, I cannot comprehend how we expect 
to sustain this situation.
    It is my belief that by passing the line item veto and by 
restoring the President's impoundment power, we would take a 
much needed step in the right direction of restoring spending 
discipline in Washington.
    I thank you for the leadership in holding these hearings. 
We must cut wasteful spending to control our deficit so we 
don't burden our grandchildren with our debt.
    Mr. Chabot. Thank you very much, Congressman Kennedy. We 
appreciate that.
    [The prepared statement of Mr. Kennedy follows:]

 Prepared Statement of the Honorable Mark Kennedy, a Representative in 
                  Congress from the State of Minnesota

    Mr. Chairman, as someone who spent 20 years in the business world 
before coming to Congress, I understand that for any business to be 
successful, it needs to have leadership that establishes priorities.
    The owners of businesses big and small know this, but, over the 
past couple of decades Congress has decided to follow a different set 
of rules.
    You don't have to look any further than the proliferation of 
earmarks, which have grown from 958 in FY1996 to nearly 14,000 in 
FY2005.
    Egregious examples of waste are easy to see: $2,000,000 to relocate 
a kitchen in Fairbanks, Alaska; $950,000 for the Please Touch Museum in 
Philadelphia; and $150,000 for the Therapeutic Horseback Riding Program 
at the Lady B Ranch in California.
    These no longer come as a surprise to us. So we shouldn't be 
surprised that FY2006 spending is projected to reach an all-time high 
of $23,638 per U.S. household, of which $3,800 will be borrowed.
    All of this uncontrolled spending on non-necessities has led to 
budget deficit of simply unsustainable proportions. That's why I have 
introduced H.J. Res. 71, the Line Item and Reduction Veto Amendment. 
This Constitutional Amendment would provide the president with a proven 
mechanism to cut the junk out of spending bills.
    My bill would restore the same authority as was provided to 
President Clinton through the 1996 Line Item Veto Act.
    This authority, already held by 40 governors, was used by President 
Clinton a total of 82 times, and produced savings of nearly $2 billion 
before it was ruled unconstitutional by the Supreme Court on June 25, 
1998.
    In addition, H.J. Res. 71, unlike the 1996 Line Item Veto Act, 
allows the president to reduce objectionable spending items contained 
in the non-legislative text of conference reports.
    This mechanism, currently used by 11 states, reduces the lump-sum 
accounts that contain hundreds and thousands of individual items that 
are often hidden in unamendable form.
    Both Representative Ryan's bill, H.R. 4890, and my Constitutional 
Amendment, will make a significant step to restoring fiscal sanity to 
the federal budget.
    I happen to believe the Constitutional Amendment is the stronger 
approach because it eliminates any question of its legality and will 
halt another round of time-consuming separation of powers lawsuits. As 
CRS has noted in a recent report, there are still concerns about the 
enhanced rescission authority provided to the President in HR4890.
    While Congress may be able to address these concerns, my 
legislation, which mirrors constitutional authority held by governors 
across the country, offers a clear and decisive answer free from the 
tinkering of activist judges.
    A Line Item Veto Constitutional Amendment will help restore some 
sorely needed fiscal discipline in Washington, but there is still more 
we can do to stop runaway spending.
    I believe we must also look at other tried and true measures, 
including Impoundment Authority.
    This authority was used by presidents for almost two centuries to 
reduce excessive spending.
    President Jefferson was the first to use impoundment authority in a 
significant way, and it was used by FDR during World War 2 to block 
Congressional spending he determined ``interferes with the defense 
program by diverting manpower and materials.''
    Unfortunately, impounding funds ceased to be an option for 
presidents in 1974 when Congress passed the Congressional Budget and 
Impoundment Control Act.
    This Act not only stripped the executive of constitutional 
authority to impound spending, but also increased Congress's appetite 
toward waste and larger government.
    Mr. Chairman, after adjusting for inflation, since the 1974 Act was 
enacted into law, federal spending as grown by over 250 percent.
    As perhaps the only former CFO serving in Congress, I cannot 
comprehend how we expect to sustain this situation.
    It is my belief that by passing the Line Item Veto, and by 
restoring the President's Impoundment Power, we would take a much 
needed step in the right direction to restoring spending discipline in 
Washington.
    Mr. Chairman, I thank you for your leadership in holding this 
hearing. We must cut wasteful spending to control our deficit so we 
don't burden our grandchildren with our debts.

    Mr. Chabot. Ms. Firvida, you are recognized for 5 minutes.

TESTIMONY OF CRISTINA MARTIN FIRVIDA, SENIOR COUNSEL, NATIONAL 
                       WOMEN'S LAW CENTER

    Ms. Firvida. Thank you. Chairman Chabot, Ranking Member 
Nadler, and Members of the Subcommittee, thank you for this 
opportunity to testify on behalf of the National Women's Law 
Center.
    H.R. 4890 would dramatically expand the powers of the 
President relative to Congress, presenting serious policy and 
constitutional questions while doing very little, if anything, 
to control growing deficits. This bill has sometimes been 
described as a means of eliminating unnecessary earmarks, but 
its scope is far broader than that. The rescission power 
granted to the President under this bill would apply not only 
to appropriations, which are already covered under current law, 
but also to direct spending, including the reauthorization of 
entitlement programs, such as the State Children's Health 
Insurance Program and the farm bill, which contains food 
stamps, both up for reauthorization next year.
    H.R. 4890 would also give the President extraordinary power 
to suspend and effectively cancel provisions of law enacted by 
Congress and to control the legislative agenda of Congress. 
This power raises significant policy issues and effectively 
confers upon the President the power to amend or repeal duly 
enacted legislation, in violation of the Separation of Powers 
Doctrine and the Presentment and Bicameralism Clauses of 
Article I, Section 7 of the Constitution.
    To cap it off, empirical evidence suggests that the 
proposed legislative line item veto would not result in 
substantial savings that would reduce our nation's record 
deficits and may paradoxically actually increase spending.
    H.R. 4890 would give the President unprecedented new 
authority to suspend funding for a period of 180 days and 
possibly more after sending a rescission request to Congress, 
even if Congress explicitly rejected the President's decision. 
In addition, H.R. 4890 grants the President extremely broad 
discretion to determine when, in what fashion, and how often to 
rescind spending.
    Significantly, H.R. 4890 does not prohibit the President 
from resubmitting a rejected rescission in a subsequent request 
to Congress. In contrast, both current law and the Line Item 
Veto Act of 1996 explicitly require that the President 
immediately reinstate canceled spending if Congress rejects the 
President's rescission request and bar the President from 
resubmitting previously rejected rescissions.
    The extraordinary new powers that H.R. 4890 would confer 
upon the President raise serious constitutional powers under 
the Separation of Powers Doctrine. Separation of powers is a 
fundamental feature of our Constitution and system of 
Government, and as such, the Supreme Court has historically 
taken a very strict approach to analyzing potential violations 
of this doctrine. There is no provision in the Constitution 
that authorizes the President to enact, to amend, or to repeal 
statutes. In the case that invalidated the Line Item Veto Act 
of 1996, the Court ruled that allowing the President to cancel 
spending unilaterally amounted to an impermissible exercise of 
the power to amend or repeal statutes, a legislative power that 
is explicitly and exclusively reserved for the Congress under 
the Constitution.
    Like the power to cancel spending items already struck down 
by the Court, the powers granted to the President in this bill 
allow him to amend or repeal duly enacted legislation. Under 
H.R. 4890, the President can suspend provisions of law even if 
Congress rejects the President's proposal to do so. The 
President could time a package of rescissions so that he could 
withhold funding until the end of the fiscal year, when 
spending authority would cease for many items. The bill would 
also allow the President to resubmit already rejected 
rescissions, which likewise also could effectively terminate 
spending authority.
    Because all these actions together would end duly enacted 
programs in both legal and practical effect, the President 
would have the power to amend and repeal legislation and that 
is unconstitutional under the Separation of Powers Doctrine as 
well as under the Bicameralism and Presentment Clauses of 
Article I.
    The fact that Congress is considering granting the 
President such extraordinary power does not resolve the 
constitutional issues. The Constitution does not authorize 
Congress to cede to the executive that power which is properly 
its own.
    While no amount of deficit reduction could justify a 
violation of the Constitution, numerous commentators and 
analysts, including CBO, CRS, and George Will, have concluded 
that the line item veto is an ineffective tool for controlling 
spending and that could, in fact, increase spending under some 
circumstances.
    In addition, H.R. 4890 is ill-equipped to eliminate special 
interest tax breaks and, in fact, renders broad-based tax 
policies funded by direct spending, such as the Earned Income 
Tax Credit and the Additional Child Tax Credit, vulnerable to 
cancelation.
    In conclusion, our Constitution does not authorize the 
President to enact, amend, or repeal statutes. Granting the 
President that authority, as H.R. 4890 would effectively do, 
would be unwise as well as unconstitutional for the reasons set 
forth in this testimony.
    I thank the Chair for scheduling this important oversight 
hearing and for the opportunity to testify today.
    Mr. Chabot. Thank you very much.
    [The prepared statement of Ms. Firvida follows:]

             Prepared Statement of Cristina Martin Firvida

    Chairman Chabot, Ranking Member Nadler, and members of the 
Subcommittee, thank you for this opportunity to testify on behalf of 
the National Women's Law Center on H.R. 4890, the Legislative Line Item 
Veto Act of 2006. The bill would dramatically expand the powers of the 
President in relation to Congress, presenting serious policy and 
constitutional questions while doing little, if anything, to control 
growing deficits.
    The bill has sometimes been described as a means of eliminating 
unnecessary earmarks, but its scope is far broader. H.R. 4890 would 
give the President unprecedented power to suspend, and effectively 
cancel, provisions of law enacted by Congress, even after Congress has 
rejected the President's rescission proposal. The expanded rescission 
power would apply not only to appropriations, currently subject to a 
more limited rescission authority, but also to direct spending for 
programs upon which millions of Americans rely, and, on its face, some 
targeted tax benefits. In addition, the bill would enable the President 
to control the legislative agenda of Congress, because the President 
would have the ability to control the timing and number of rescission 
bills sent to Congress, and the expedited rescission process would 
require that Congress respond. These sweeping new provisions raise 
significant policy issues and effectively confer upon the President the 
power to amend or repeal duly enacted legislation, in violation of the 
separation of powers doctrine and the presentment and bicameralism 
clauses of Article I, Section 7 of the Constitution of the United 
States.
    In addition, empirical evidence suggests that the proposed 
Legislative Line Item Veto would not result in substantial savings that 
would reduce our nation's record deficits. Indeed, the potential for 
Congress to agree to fund the President's priorities in exchange for 
the President's promise not to exercise the veto suggests that spending 
may increase as a result of this legislation.

    H.R. 4890 GRANTS THE PRESIDENT SWEEPING POWERS TO SUSPEND--AND 
        EFFECTIVELY CANCEL--COVERED SPENDING AND TAX PROVISIONS

    This bill would give the President the unilateral power to suspend, 
and in some cases, effectively cancel, spending and tax provisions 
enacted by Congress. This Presidential power to essentially amend or 
repeal duly enacted legislation is bad public policy and presents the 
clearest constitutional violation in H.R. 4890.
    H.R. 4890 would give the President sweeping new authority to 
suspend covered spending and tax provisions even after Congress had 
rejected the proposed rescission. The bill would allow the President to 
suspend funding for a period of 180 days (and possibly more) after 
sending a special message to Congress seeking legislative approval of 
the rescission, even if Congress explicitly rejects it. This is a 
dramatic departure from current rescission authority. Current law gives 
the President authority to withhold appropriated funds for up to 45 
session days while Congress considers a proposed rescission, but 
explicitly requires that the President's suspension of funding 
immediately end if one legislative house rejects the President's 
rescission request (or at the end of the 45-day period if no action is 
taken) and that budget authority be made available for obligation 
immediately. The Line Item Veto Act of 1996 likewise required the 
President to immediately reinstate cancelled funding if Congress 
adopted a joint resolution of disapproval. Giving the President the 
power to ignore the expressed will of Congress as H.R. 4890 would do is 
unprecedented.
    In addition, H.R. 4890 grants the President extremely broad 
discretion to determine when, in what fashion, and how often to rescind 
covered provisions of law. While H.R. 4890 requires Congress to act 
upon a rescission request sent by the President within 13 session days, 
the bill permits the President to send his proposed rescissions to 
Congress up to one year after enacting a spending or tax bill. In 
addition, the bill allows the President to send rescissions from one 
spending or tax law in numerous rescission bills to Congress, or to 
send rescissions from several spending or tax laws in one rescission 
bill. Finally, in contrast to current law, the bill does not appear to 
prohibit the President from resubmitting the rejected rescission in a 
different rescission request, and continuing to suspend the operation 
of the provision.
    The powers granted to the President under H.R. 4890, taken 
together, would effectively grant the President the ability not merely 
to delay, but to cancel provisions of law unilaterally. For example, 
the President could submit a package of rescissions to Congress in the 
spring and withhold funding until the end of the fiscal year, when 
spending authority would cease for many items, terminating the program 
even if Congress explicitly rejected the rescission. As a result of the 
broad new powers granted to the President in H.R. 4890, federal 
agencies, state and local governments, and individuals who administer 
or receive federal funding through a variety of programs and benefits, 
would be unable to rely on funding approved by Congress.
h.r. 4890 would allow the president to rescind direct spending as well 
as appropriations, but do little to control special interest tax breaks
    The breadth of the cancellation power granted to the President 
under H.R. 4890 is matched by the breadth of the spending items to 
which it can apply, compounding the constitutional and policy concerns 
raised by the new power. Despite the fact that H.R. 4890 has been 
justified as a mechanism for controlling earmarks and tax benefits for 
powerful special interests, the bill also would apply to broad-based 
items of direct spending, and render low-income recipients of mandatory 
spending programs especially vulnerable to program cuts.
    The expanded rescission powers authorized by H.R. 4890 would apply 
not only to appropriations, to which more limited rescission authority 
currently applies, but also to new items of mandatory spending, 
allowing the President to override individual entitlements enacted into 
law. The expansion of the President's rescission authority to apply to 
direct spending items is especially troubling because the broad 
definition of ``direct spending'' in the bill may be claimed to allow 
the cancellation of existing entitlement spending in reauthorizations, 
rather than only new spending. For example, if H.R. 4890 were to be 
enacted, it is possible that a significant number of provisions in the 
reauthorizations next year of the State Children's Health Insurance 
Program and the Farm Bill (which authorizes Food Stamps) could be 
subject to rescission even if those provisions were not new and did not 
add to the costs of the legislation.
    Conversely, the definition of targeted tax benefit in the bill is 
so narrowly constructed as to virtually guarantee that no carefully 
drafted tax benefit will be subject to the new cancellation power. The 
definition used in the bill would apply to tax provisions that benefit 
100 or fewer beneficiaries, except that it would not apply if the 
provision treats all persons engaged in the same industry or activity 
or owning the same type of property similarly. The Joint Committee on 
Taxation analyzed this definition (which was included as part of the 
Line Item Veto Act of 1996), and concluded that the exceptions were 
vague and poorly defined.\1\ As a result, this creates the potential to 
altogether exempt tax breaks from the line item veto. For example, had 
the Legislative Line Item Veto Act of 2006 been in effect when the 2004 
corporate tax bill was passed, the President might have been powerless 
to cancel special interest tax breaks for ceiling fan importers and 
tackle-box manufacturers,\2\ among others, which were criticized by 
many observers as pork, and which presumably would be the type of 
targeted tax benefit H.R. 4890 is supposed to eliminate.
---------------------------------------------------------------------------
    \1\ Staff of Joint Comm. on Taxation, Analysis of Provisions 
Contained in the Line Item Veto Act (Public Law 104-130) Relating to 
Limited Tax Benefits 20 (Joint Comm. Print 1997).
    \2\ Edmund L. Andrews, How Tax Bill Gave Business More and More, 
N.Y. Times, Oct. 13, 2004, at A1.
---------------------------------------------------------------------------
    While some justify limiting the definition of ``targeted tax 
benefits'' to ensure that only special interest tax breaks and not 
broad-based tax policies are subject to cancellation, no similar 
limitation exists to ensure that broad-based direct spending policies 
are also not subject to cancellation. In fact, the only broad-based tax 
policies that may be subject to the Legislative Line Item Veto are 
those that include items of direct spending. The two most prominent tax 
credits that trigger direct spending are the Earned Income Credit and 
the Additional Child Tax Credit. Both of these credits assist low-
income families. Should H.R. 4890 be adopted, the President may be 
authorized to cancel portions of these credits should Congress, for 
example, vote to extend improvements to the credits passed in 2001 and 
2003. There is no justification for giving the President the authority 
to suspend tax provisions that help millions of poor children but not 
tax provisions that benefit a few thousand multi-millionaires.

   H.R. 4890 ALLOWS THE PRESIDENT TO CONTROL THE CONGRESSIONAL AGENDA

    The process for Congress to respond to the President's proposed 
rescissions set forth by H.R. 4890 creates the potential for the 
President to exercise considerable control over the congressional 
schedule and agenda, above and beyond budget and spending bills. This 
ability to reorder congressional legislative priorities in and of 
itself will result in a bad policy outcome, and when combined with the 
broad authority to cancel spending granted by H.R. 4890, exacerbates 
the constitutional breach contained in this proposal.
    Under current law, if Congress fails to approve the President's 
rescission proposal within 45 session days, including by inaction, 
spending authority must be restored. Given that Congress has the power 
of the purse under our constitutional structure of separation of 
powers, it is appropriate to leave to Congress the discretion to act on 
the President's suggested rescissions, to act instead on its own 
package of rescissions, or to do nothing at all. However, H.R. 4890 
would strip Congress of this discretion and would amend House and 
Senate rules to provide for fast-track consideration of presidential 
rescission messages.
    Under the new fast-track rules in H.R. 4890, a bill encompassing 
the President's rescission package must be introduced by congressional 
leadership no later than two session days after the President sends a 
special message to Congress proposing the rescissions. If no bill is 
introduced by the second session day, any member may introduce the bill 
thereafter. Once the rescission bill is introduced, the appropriate 
committees are required to approve the bill without any change no later 
than the fifth session day, or, if the appropriate committees fail to 
do so by that day, the bill is automatically discharged from the 
committees. Both the House and Senate must have an up or down vote on 
the rescission bill, without amendment, by the end of the tenth session 
day after introduction of the bill. In summary, if the procedures are 
adhered to and are not waived by rule or otherwise ignored, Congress 
would be compelled to complete action on the President's rescissions 
within 13 session days of the President's sending the proposal to 
Congress.
    In combination with the broad discretionary authority granted to 
the President to send rescission messages at any time and in any manner 
that the President sees fit, these fast-track procedures are an 
invitation to allow the President to control the entire Congressional 
legislative agenda. For example, a President could exercise the 
rescission authority as a parliamentary tool to tie up the 
Congressional schedule indefinitely or until the President receives the 
concessions he or she seeks. The President could send over a series of 
bills that rescind spending items from bills that were passed and 
signed at different times, bundling the rescission of spending items 
that are popular in Congress with those that are unpopular with the 
public, in order to compel Congress to turn away from other work and 
dispose of the rescissions. This would enable the President to control 
the timing of votes in Congress on other pending legislation. If 
deployed during the second half of a second session of any given 
Congress, the tactic could run out the clock on other pending 
legislation. It is important to note that H.R. 4890 could affect 
consideration of all pending legislation in this way, not just 
legislation related to spending items.

   THE EXPANSIVE POWERS GRANTED TO THE PRESIDENT BY H.R. 4890 RAISE 
                    SERIOUS CONSTITUTIONAL PROBLEMS

    The extraordinary new powers that H.R. 4890 would confer upon the 
President raise serious constitutional problems under the separation of 
powers doctrine, as well as the presentment and bicameralism 
requirements of Article 1, section 7 of the Constitution of the United 
States.
    The separation of powers is a fundamental feature of our 
Constitution and our system of government. It was designed to and does 
play a crucial role in safeguarding the liberties and freedoms that the 
Constitution created and which the founding fathers endeavored to 
protect. As Justice Kennedy so succinctly put it in his concurrence in 
Clinton v. City of New York: \3\
---------------------------------------------------------------------------
    \3\ Clinton, 524 U.S. 417 (1998).

        Liberty is always at stake when one or more of the branches 
        seek to transgress the separation of powers. Separation of 
        powers was designed to implement a fundamental insight: 
        Concentration of power in the hands of a single branch is a 
        threat to liberty. The Federalist states the axiom in these 
        explicit terms: ``The accumulation of all powers, legislative, 
        executive, and judiciary, in the same hands . . . may justly be 
        pronounced the very definition of tyranny.'' \4\
---------------------------------------------------------------------------
    \4\ Id. at 450 (Kennedy, J., concurring) (citation omitted).

    The Supreme Court has historically taken a strict approach to 
analyzing potential violations of the separation of powers doctrine. A 
long line of cases demonstrates that the Court is extremely skeptical 
of any encroachment on the power of each branch and consequently will 
apply a strict formal analysis frequently resulting in the invalidation 
of the Congressional act. As the court stated in Mistretta v. United 
---------------------------------------------------------------------------
States:

        Accordingly, we have not hesitated to strike down provisions of 
        law that either accrete to a single Branch powers more 
        appropriately diffused among separate Branches or that 
        undermine the authority and independence of one or another 
        coordinate Branch. For example, just as the Framers recognized 
        the particular danger of the Legislative Branch's accreting to 
        itself judicial or executive power, so too have we invalidated 
        attempts by Congress to exercise the responsibilities of other 
        Branches or to reassign powers vested by the Constitution in 
        either the Judicial Branch or Executive Branch.\5\
---------------------------------------------------------------------------
    \5\ Mistretta v. United States, 488 U.S. 361, 382 (1989) (citing 
Bowsher v. Synar, 478 U.S. 714 (1986), INS v. Chadha, 462 U.S. 919 
(1983), Northern Pipeline Construction Co. v. Marathon Pipe Line Co., 
458 U.S. 50 (1982)).

    In Clinton v. City of New York, the Court emphasized that while 
some lawmaking responsibilities are assigned to the President in 
Articles I and II of the Constitution, ``there is no provision in the 
Constitution that authorizes the President to enact, to amend, or to 
repeal statutes.'' \6\ In addition, the lack of a Constitutional 
provision assigning the President such a role was interpreted to be the 
equivalent of an express prohibition.\7\ The Court ruled in Clinton 
that allowing the President to cancel spending unilaterally amounted to 
an impermissible exercise of the power to amend or repeal statutes, a 
power that is explicitly reserved for the Congress under the 
Constitution.\8\
---------------------------------------------------------------------------
    \6\ Clinton, 524 U.S. at 438.
    \7\ Id. at 439.
    \8\ Id. at 438-441.
---------------------------------------------------------------------------
    Like the power to cancel items of spending struck down by the Court 
in Clinton, the powers granted to the President by H.R. 4890 constitute 
an amendment or repeal of a statute by the President. Under H.R. 4890, 
the President can suspend the operation of provisions of law for 180 
days even if Congress rejects the proposed rescission. H.R. 4890 gives 
the President the power to decide when to submit a rescission request, 
and, depending when the rescission is submitted, the ``suspension'' 
could result in the permanent elimination of spending authority. H.R. 
4890 also would allow the President to resubmit proposed rescissions 
that Congress had previously rejected, which likewise could effectively 
terminate spending authority. Because the broad powers granted to the 
President by H.R. 4890 could end, as a practical matter, programs 
funded by discretionary spending, direct spending programs, or tax 
benefits previously approved by Congress, ``[i]n both legal and 
practical effect, the President [would have] amended . . . Acts of 
Congress by repealing a portion of each.'' \9\ As the Congressional 
Research Service concluded, these provisions may reach ``far enough to 
be considered an effective grant of authority to cancel provisions of 
law . . . ,'' \10\ and that was proscribed by the Supreme Court in 
Clinton v. City of New York.
---------------------------------------------------------------------------
    \9\ Clinton, 524 U.S. at 438.
    \10\ Morton Rosenberg, Line Item Veto: A Constitutional Analysis of 
Recent Proposals, Congressional Research Service, Apr. 17, 2006, at 1, 
2.
---------------------------------------------------------------------------
    In addition, because the cancellation authority the President is 
granted by H.R. 4890 is legislative in nature, it also violates the 
provisions of Article I, Section 7 of the Constitution of the United 
States, namely, the presentment and bicameralism clauses. These clauses 
provide that no law can take effect without the approval of both Houses 
of Congress and that all legislation must be presented to the President 
before becoming law. As INS v. Chadha makes clear, the amendment and 
repeal of statutes, no less than their enactment, must conform with 
Article I.\11\ Pursuant to H.R. 4890, the President would have the 
ability to create a different law from one duly enacted by Congress and 
signed by the President, temporarily and possibly permanently, without 
Congressional approval and despite Congressional disapproval.
---------------------------------------------------------------------------
    \11\ 462 U.S. 919, 954 (1983).
---------------------------------------------------------------------------
    The fact that Congress is considering granting the President such 
extraordinary power does not resolve the constitutional issues. The 
Constitution does not authorize Congress to cede to the executive that 
power which is properly its own. As Justice Kennedy stated in his 
concurrence in Clinton:

        That a congressional cession of power is voluntary does not 
        make it innocuous. The Constitution is a compact enduring for 
        more than our time, and one Congress cannot yield up its own 
        powers, much less those of other Congresses to follow. . . . 
        Abdication of responsibility is not part of the constitutional 
        design.'' \12\
---------------------------------------------------------------------------
    \12\ Clinton, 524 U.S. at 452 (citations omitted).

    h.r. 4890 is unlikely to reduce and could even increase spending
    The experience with line item vetoes at the federal and state level 
does not suggest that enacting H.R. 4890 will significantly reduce the 
deficit. Moreover, by significantly increasing the President's ability 
to negotiate for the Administration's own budget priorities, the line 
item veto may actually increase spending. While no amount of savings or 
deficit reduction could justify a violation of the Constitution, the 
very poor track record of the line item veto as a tool to control 
spending should alone be grounds to reject the proposal.
    The President's current rescission authority has not produced 
significant savings over time.\13\ In fact, the current administration 
(in contrast to other administrations) has never used current 
rescission authority (nor the constitutional veto power) to curtail 
spending. Nonetheless, frustration with current rescission authority 
has suggested to some that a line item veto is needed to give the 
President the power to control spending.
---------------------------------------------------------------------------
    \13\ Statement of Donald B. Marron, Acting Director, Congressional 
Budget Office, CBO's Comments on H.R. 4890, the Legislative Line Item 
Veto Act of 2006, Hearing before the Subcomm. on the Legislative and 
Budget Process of the House, Comm. on Rules 2 (Mar. 15, 2006), 
available at http://www.cbo.gov/ftpdocs/70xx/doc7079/03-15-
LineItemVeto.pdf [hereinafter CBO Testimony].
---------------------------------------------------------------------------
    However, the evidence on the effect of a more aggressive--and 
unconstitutional--rescission authority, the Line Item Veto Act of 1996, 
shows minimal impact on budget savings. According to the Congressional 
Research Service, the implementation of the 1996 Act produced modest 
savings.\14\ In one year, the President successfully vetoed $355 
million in spending out of a $1.7 trillion budget. The total savings 
produced by President Clinton's line item vetoes amounted to less than 
$600 million over five years. The savings would have been greater had 
Congress approved all of the President's request to cancel funding--but 
even if each and every cancellation had been accepted, the amount would 
still have come to well under $1 billion over five years.
---------------------------------------------------------------------------
    \14\ Louis Fisher, A Presidential Item Veto, Congressional Research 
Service, Dec. 2, 2004, at 1.
---------------------------------------------------------------------------
    The picture from the states also provides little evidence that the 
line item veto is an effective means of controlling spending. 
Currently, 43 states have line item veto authority for their 
governors.\15\ State budget practices are fundamentally different from 
federal budgeting practices, in part because the constitutions of most 
states provide very explicit details on how budgets are to be enacted, 
and most give the executive branch of government a much stronger role 
in budgeting than is constitutionally permissible at the federal 
level.\16\ However, even governors with significant line item veto 
power are unable to secure significant savings through it. Douglas 
Holtz-Eakin, former director of the Congressional Budget Office, in a 
survey of evidence from the states concluded ``that long run budgetary 
behavior is not significantly affected by the power of an item veto.'' 
\17\ In testimony last month before the House Rules Committee, the CBO 
renewed the observation that in some states the line item veto has not 
decreased spending, as the result of governors and legislatures 
negotiating to include a governor's spending priorities in a state's 
budget in exchange for a promise that the governor will not exercise 
line item veto authority.\18\ The CBO expressed concern that a similar 
dynamic at the federal level would result in higher spending.\19\
---------------------------------------------------------------------------
    \15\ Budget Process in the States, National Association of State 
Budget Officers, Sept. 1997, at 1.
    \16\ Louis Fisher, Line Item Veto Act of 1996: Lessons from the 
States, Congressional Research Service, Dec. 26, 1996, at 1.
    \17\ Douglas Holtz-Eakin, The Line Item Veto and Public Sector 
Budgets: Evidence from the States 2 Working Paper No. 2531, National 
Bureau of Economic Research (March 1988).
    \18\ CBO Testimony, supra note 12, at 6.
    \19\ Id at 5-6.
---------------------------------------------------------------------------
    Indeed, the concerns expressed by the CBO have been echoed and 
expanded upon by other observers. George Will, in an insightful column 
examining the line item veto, stated that, ``knowing the president can 
veto line items, legislators might feel even freer to pack them into 
legislation, thereby earning constituents' gratitude for at least 
trying to deliver.'' \20\ He went on to describe how the President 
could buy the support of members of Congress on his legislative 
priorities in exchange for a promise that he would not veto the 
spending priorities of the members.\21\ The Congressional Research 
Service came to a similar conclusion in a 2005 report. Warning that 
savings would be very limited under a line item veto, the Congressional 
Research Service went on to state, ``Under some circumstances, the 
availability of an item of veto could increase spending. The 
Administration might agree to withhold the use of an item veto for a 
particular program if Members of Congress agreed to support a spending 
program initiated by the President.'' \22\ The concern that the 
Legislative Line Item Veto will not only fail to decrease spending but 
may exacerbate the record deficits that we face is one that must be 
taken seriously.
---------------------------------------------------------------------------
    \20\ George Will, The Vexing Qualities of a Veto, N.Y. Times, Mar. 
16, 2006, at A23.
    \21\ Id.
    \22\ Louis Fisher, Item Veto: Budgetary Savings, Congressional 
Research Service, May 26, 2005, at 3.
---------------------------------------------------------------------------
                               CONCLUSION

    The separation of powers is fundamental to our Constitution and 
system of government. Our Constitution does not authorize the President 
to enact, amend, or repeal statutes. Granting the President that 
authority--as H.R. 4890 would effectively do--would be unwise as well 
as unconstitutional for the reasons set forth in this testimony. I 
thank the Chair for scheduling this important oversight hearing and for 
the opportunity to testify.

    Mr. Chabot. I commend all the witnesses so far in keeping 
so close to within the time limits. That doesn't always happen, 
so an excellent job. You have got a high standard to follow 
here, Mr. Cooper. We are very pleased to have you, as well, 
here this afternoon and you are recognized for 5 minutes.

           TESTIMONY OF CHARLES J. COOPER, PARTNER, 
                     COOPER AND KIRK, PLLC

    Mr. Cooper. Thank you very much, Mr. Chairman. I appreciate 
that very much. I will try to keep with that tradition.
    And I also very much appreciate your reference to my role 
in the Clinton case in your introduction. I do think the 
Clinton case is controlling in the analysis of the 
constitutionality of this measure, so I will focus 
substantially on that.
    At issue in the Clinton case was the Line Item Veto Act of 
1996, which provided that the President may cancel--cancel in 
whole the same types of provisions that are at issue in this 
measure. Cancellation took effect under that act when Congress 
received his special message to that effect. The act defined 
cancel as ``to rescind and to prevent from having legal force 
or effect.'' The Congress used those words quite deliberately. 
Its purpose was to make clear that the President's action would 
be permanent and irreversible, and so it was, because in order 
to restore a canceled item, Congress had to pass a disapproval 
bill, in other words, a new law which had to satisfy, 
obviously, bicameralism and present to the President for his 
approval.
    In striking down the Line Item Veto Act of 1996, the 
Supreme Court in Clinton concluded that vesting the President 
with unilateral power to cancel a provision of duly enacted law 
could not be reconciled with the single finely wrought and 
exhaustively considered procedure established under article I, 
section 7, for enacting or repealing a duly enacted law, that 
is, bicameral passage and presentment to the President. Those 
words, ``finely wrought,'' that formulation, of course, is 
familiar to all legislators, I am sure, from Chadha.
    President Clinton's cancelation, however, and these are the 
Court's words, ``presented one section of the Balanced Budget 
Act of 1997,'' the provision at issue there, ``from having 
legal force or effect while the remaining provisions of the act 
continued to have the same force and effect that they had when 
signed into law.'' So the Supreme Court concluded that, again, 
its words, ``cancellations pursuant to the Line Item Veto Act 
are the functional equivalent of partial appeals of Acts of 
Congress.'' That failed to satisfy article I, section 7.
    The Legislative Line Item Veto Act of 2006, in contrast, is 
framed in careful obedience to article I, section 7, and to the 
Supreme Court's teachings in Clinton. The President is not 
authorized by that bill to cancel any spending or tax provision 
or otherwise to prevent such provision from having legal force 
and effect. To the contrary, any spending or tax provisions 
duly enacted into law remain in full force and effect until the 
bill and unless the bill is repealed in accordance with article 
I, section 7 process.
    To be sure, this measure would authorize the President to 
defer or suspend execution of the spending or tax provision at 
issue for up to 180 calendar days from the date that the 
President transmits his rescission proposal, but the President 
will also be authorized to terminate that referral if he 
believes that continuing it would be inconsistent with the 
purposes of the act. At the end of the deferral period, the 
President would be required to make the funds or tax benefits 
available.
    The Congressional practice of vesting discretionary 
authority in the President to defer or even to decline the 
expenditure of appropriated funds has been commonplace since 
the beginning of the republic and its constitutionality has 
never been seriously questioned. My written testimony trudges 
through quite a few examples of this and I won't belabor them. 
But suffice it to say that when Congress has passed such 
appropriations bills or when it has given the President general 
authority to reduce Government spending below appropriated 
levels, Congress has largely freed the President to exercise 
his own judgment regarding which spending programs to reduce 
and how much to reduce them. While the scope of that authority 
has varied in response to changing legislative judgments about 
the need for executive branch discretion, the extent of the 
Executive's spending discretion has always been regarded both 
by Congress and by the Court as a matter for this body, for 
Congress itself to decide through the legislative process.
    The Supreme Court in Clinton acknowledged Congress's 
venerable and non-controversial practice of vesting this kind 
of broad discretion in the President. But the critical 
difference with the Line Item Veto Act of 1996, as the Court 
said, is that unlike any of those prior precedents, this act 
gives the President unilateral power to change the text of duly 
enacted statutes. There is nothing of that consequence in the 
measure that is before you, I would submit.
    The short of my testimony, Mr. Chairman, is this--and I am 
just going to be a few seconds over--is this. The Supreme 
Court's decision in Clinton recognizes and enforces the 
constitutional line established by article I, section 7 between 
the power to exercise discretion in the making or the unmaking 
of law, on the one hand, and the power to exercise discretion 
in the exercise of law on the other. Congress cannot 
constitutionally vest in the President the former, but it can 
the latter, and it has done so repeatedly throughout our 
Nation's history. I believe that the measure that is now 
pending for your consideration falls safely on the 
constitutional side of that line.
    Thank you again for having me today.
    Mr. Chabot. Thank you very much.
    [The prepared statement of Mr. Cooper follows:]

                Prepared Statement of Charles J. Cooper

    Good afternoon Mr. Chairman and Members of the Subcommittee. My 
name is Charles J. Cooper, and I am a partner in the Washington, D.C., 
law firm of Cooper & Kirk, PLLC. I appreciate the Subcommittee's 
invitation to present my views on ``The Constitution and the Line Item 
Veto.'' I shall focus my testimony on the constitutionality of the 
``Legislative Line Item Veto Act of 2006,'' which has been proposed by 
President Bush and has been introduced in this body as H.R. 4890 by 
Representative Paul Ryan. For reasons that I shall discuss at length 
below, I believe that the President's proposal is constitutional. But 
first I would like to outline my experience in this esoteric area of 
constitutional law.
    I have spent the bulk of my career, both as a government lawyer and 
in private practice, litigating or otherwise studying a broad range of 
constitutional issues. On several different occasions, strangely 
enough, I have been involved in matters relating to the 
constitutionality of measures designed to vest the President with 
authority to exercise a line item veto or its functional equivalent. In 
early 1988, while I was serving as the Assistant Attorney General of 
the Office of Legal Counsel of the Department of Justice, President 
Reagan asked the Justice Department for its opinion on the question 
whether the Constitution vests the President with an inherent power to 
exercise an item veto. Certain commentators at that time had advanced 
the proposition that the President did indeed have such inherent 
constitutional power. See Steven Glazier, Reagan Already Has Line-Item 
Veto, WALL ST. J., Dec. 4, 1987, at 14, col. 4. After exhaustive study, 
the Justice Department reluctantly concluded that the proposition was 
not well-founded and that the President could not conscientiously 
attempt to exercise such a power. I suspect that many of the Members of 
this body can recall how fervently President Reagan longed to exercise 
a line item veto authority, and during my time in government, I had no 
task less welcome than advising him against it. The opinion of the 
Office of Legal Counsel is publicly available at 12 Op. Off. Legal 
Counsel 128 (1988).
    In April of 1996, Congress enacted the Line Item Veto Act of 1996, 
which authorized the President to ``cancel'' certain spending and tax 
benefit measures after he had signed into law the bill in which they 
were contained. Shortly thereafter, I was retained, along with Lloyd 
Cutler, Alan Morrison, Lou Cohen, and Michael Davidson, to represent 
Senators Byrd, Moynihan, and Levin, and Congressmen Waxman and Skaggs 
to challenge the constitutionality of the Line Item Veto Act. Although 
the district court invalidated the Act, the Supreme Court held that the 
Members of Congress lacked standing to litigate their constitutional 
claims. Adjudication of the Act's constitutionality would therefore 
have to await the suit of someone who had suffered judicially 
cognizable injury resulting from an actual exercise of the President's 
statutory cancellation power. See Raines v. Byrd, 521 U.S. 811 (1997). 
That did not take long.
    Less than two months after the Supreme Court's decision in Raines, 
President Clinton exercised his authority under the Line Item Veto Act 
to cancel ``one item of new direct spending'' in the Balanced Budget 
Act of 1997, which had the effect of reducing the State of New York's 
federal Medicaid subsidies by almost $1 billion. I represented the City 
of New York and certain healthcare associations and providers, which 
lost many millions of dollars in federal matching funds as a direct 
result of the President's cancellation, in a suit challenging the 
constitutionality of the Line Item Veto Act. The Supreme Court struck 
down the Line Item Veto Act, concluding that ``the Act's cancellation 
provisions violate Article I, Sec. 7, of the Constitution.'' Clinton v. 
City of New York, 524 U.S. 417, 448 (1998). The Clinton case controls 
the analysis of the constitutionality of the Legislative Line Item Veto 
Act of 2006, and so an extended discussion of the case is warranted.
    The Line Item Veto Act of 1996 provided that the President may 
``cancel in whole'' any (1) ``dollar amount of discretionary budget 
authority,'' (2) ``item of new direct spending,'' or (3) ``limited tax 
benefit'' by sending Congress a ``special message'' within five days 
after signing a bill containing the item. 2 U.S.C. Sec. 691(a). 
Cancellation took effect when Congress received the special message. 2 
U.S.C. Sec. 691b(a).
    The Act defined ``cancel'' as ``to rescind'' (with respect to any 
dollar amount of discretionary budget authority) and to ``prevent . . . 
from having legal force or effect'' (with respect to items of new 
direct spending or limited tax benefits). Id. Sec. 691e(4). The purpose 
of the term and its definition was to make it clear that the 
President's action would be permanent and irreversible: ``The term 
`cancel' was specifically chosen, and is carefully defined. . . . The 
conferees intend that the President may use the cancellation authority 
to surgically terminate federal budget obligations.'' H.R. Rep. No. 
104-491, at 20 (1996) (Conf. Rep.) (emphasis added). For taxes, 
cancellation mandated ``collect[ion of] tax that would otherwise not be 
collected or . . . den[ial of] the credit that would otherwise be 
provided.'' Id. at 29.
    In order to restore a canceled item, Congress had to pass a 
``disapproval bill,'' 2 U.S.C. Sec. Sec. 691d, 691e(6), and the Act 
provided for expedited consideration of such disapproval bills. 2 
U.S.C. Sec. 691d. But a disapproval bill was a new law, which had to be 
passed by both Houses and presented to the President in the manner 
prescribed by Article I, Section 7, of the Constitution.
    In striking down the Line Item Veto Act of 1996, the Supreme Court 
in Clinton concluded that vesting the President with unilateral power 
to ``cancel'' a provision of duly enacted law could not be reconciled 
with the `` `single, finely wrought and exhaustively considered, 
procedure' ``established under Article I, Section 7 for enacting, or 
repealing, a law--bicameral passage and presentment to the President. 
524 U.S. at 439-40, quoting INS v. Chadha, 462 U.S. 919, 951 (1983). As 
the Court explained, Article I, Section 7 ``explicitly requires that 
each of . . . three steps be taken before a bill may `become a law.' 
``: ``(1) a bill . . . [is] approved by a majority of the Members of 
the House of Representatives; (2) the Senate approve[s] precisely the 
same text; and (3) that text [is] signed into law by the President.'' 
524 U.S. 448. And if the President disapproves of the Bill, he must 
``reject it in toto.' ``Id. at 440, quoting 33 Writings of George 
Washington 96 (J. Fitzpatrick ed., 1940).
    President Clinton's cancellation, however, ``prevented one section 
of the Balanced Budget Act of 1997 . . . `from having legal force or 
effect,' ``while the remaining provisions of the Act ``continue to have 
the same force and effect as they had when signed into law.'' 524 U.S. 
at 438. Accordingly, the Court concluded that ``cancellations pursuant 
to the Line Item Veto Act are the functional equivalent of partial 
repeals of Acts of Congress that fail to satisfy Article I, Sec. 7.'' 
Id. at 444.
    The Legislative Line Item Veto Act of 2006, in contrast, is framed 
in careful obedience to Article I, Section 7 and to the Supreme Court's 
teaching in Clinton. The President is not authorized by the bill to 
``cancel'' any spending or tax provision, or otherwise to prevent such 
a provision ``from having legal force or effect.'' To the contrary, the 
purpose of H.R. 4890, as President Bush put it in proposing the 
legislation, is simply to ``provide a fast-track procedure to require 
the Congress to vote up-or-down on rescissions proposed by the 
President.'' Message of President George W. Bush to the Congress, March 
6, 2006. Thus, any spending or tax provisions duly enacted into law 
remains in full force and effect under the bill unless or until it is 
repealed in accordance with the Article I, Section 7 process--bicameral 
passage and presentment to the President.
    To be sure, H.R. 4890 would authorize the President to ``defer'' or 
``suspend'' (hereinafter ``defer'') execution of the spending or tax 
provision at issue for up to 180 calendar days from the date that the 
President transmits his rescission proposal to Congress. But the 
President would also be authorized to terminate the deferral ``if the 
President determines that continuation of the deferral would not 
further the purposes of this Act.'' H.R. 4890, 109th Cong. 
Sec. Sec. 1021(e)(2), 1021(f)(2) (2006).1 At the end of the deferral 
period--which, again, cannot exceed 180 days--the President would be 
required to make the funds or tax benefits available. The purpose of 
this deferral authority, obviously, is simply to allow the Congress 
adequate time to consider the President's rescission proposals and to 
vote them up-or-down.
    The congressional practice of vesting discretionary authority in 
the President to defer, and even to decline, expenditure of 
appropriated funds has been commonplace since the beginning of the 
Republic, and its constitutionality cannot seriously be questioned. 
Indeed, the First Congress enacted at least three general 
appropriations laws that appropriated ``sum[s] not exceeding'' 
specified amounts for the government's operations. See Act of Sept. 29, 
1789, ch. 23, Sec. 1, 1 Stat. 95; Act of Mar. 26, 1790, ch. 4, Sec. 1, 
1 Stat. 104; Act of Feb. 11, 1791, ch. 6, Sec. 1, 1 Stat. 190. See 
Ralph S. Abascal & John R. Kramer, Presidential Impoundment Part I: 
Historical Genesis and Constitutional Framework, 62 Geo. L.J. 1549, 
1579 (1974). By appropriating sums ``not exceeding'' specified amounts, 
Congress gave the President discretion to spend less than the full 
amount of the appropriation, absent some other statutory restriction on 
that discretion. See, e.g., H.R. Rep. No. 1797, 81st Cong., 2d Sess. 9 
(1950) (``Appropriation of a given amount for a particular activity 
constitutes only a ceiling upon the amount which should be expended for 
that activity.'')
    The First Congress also enacted laws providing for ``lump-sum'' 
appropriations--that is, appropriations for the operation of a 
department that do not specify the particular items for which the funds 
were to be used. The President was thereby given discretion not only 
with respect to the amount of the appropriated sum that would be spent, 
but also with respect to its allocation among authorized uses. 
Cincinnati Soap Co. v. United States, 301 U.S. 308, 322 (1937) 
(``Appropriation and other acts of Congress are replete with instances 
of general appropriations of large amounts, to be allotted and expended 
as directed by designated governmental agencies.''). As the Supreme 
Court has noted, ``a fundamental principle of appropriations law is 
that where Congress merely appropriates lump-sum amounts without 
statutorily restricting what can be done with those funds, a clear 
inference arises that it does not intend to impose legally binding 
restrictions.'' Lincoln v. Vigil, 508 U.S. 182, 192 (1993) (internal 
quotation marks omitted). And the constitutionality of such lump-sum 
appropriations ``has never been seriously questioned.'' Cincinnati Soap 
Co., 301 U.S. at 322.
    Congress has typically enacted lump-sum appropriations when 
Executive Branch discretion and flexibility were viewed as desirable, 
particularly during periods of economic or military crisis. See Louis 
Fisher, Presidential Spending Discretion and Congressional Controls, 37 
Law & Contemp. Probs. 135, 136 (1972). During the Great Depression, for 
example, Congress granted the President broad discretion to ``reduce . 
. . governmental expenditures'' by abolishing, consolidating, or 
transferring Executive Branch agencies and functions. Act of Mar. 3, 
1933, ch. 212, Sec. 16, 47 Stat. 1517-1519 (amending Act of June 30, 
1932, ch. 314, Sec. Sec. 401-408, 47 Stat. 413-415)). All 
appropriations ``unexpended by reason of'' the President's exercise of 
his reorganization authority were to be ``impounded and returned to the 
Treasury.'' 47 Stat. 1519.
    In 1950, Congress vested the President with general authority to 
establish ``reserves''--that is, to withhold the expenditure of 
appropriated funds--in order ``to provide for contingencies, or to 
effect savings whenever savings are made possible by or through changes 
in requirements, greater efficiency of operations, or other [post-
appropriation] developments.'' General Appropriation Act, 1951, ch. 
896, Sec. 1211, 64 Stat. 765-766. Similarly, the Revenue and 
Expenditure Control Act of 1968, Pub. L. No. 90-364, Sec. Sec. 202(a), 
203(a), 82 Stat. 271-72, authorized the President to reserve as much as 
$6 billion in outlays and $10 billion in new obligation authority, with 
no restrictions on the President's discretion regarding what spending 
to reduce. Sec. Sec. 202(b), 203(b), 82 Stat. 272. See also Second 
Supplemental Appropriations Act, 1969, Pub. L. No. 91-47, Sec. 401, 83 
Stat. 82; Second Supplemental Appropriations Act, 1970, Pub. L. No. 91-
305, Sec. Sec. 401, 501, 84 Stat. 405-407.
    And in the Impoundment Control Act of 1974 (ICA), 2 U.S.C. 681 et 
seq., Congress distinguished between two forms of impoundment: 
deferrals (delays in spending during the course of a fiscal year, or 
other period of availability) and rescissions (permanent withholdings 
of spending of appropriated funds). See 2 U.S.C. 682(1), 682(3). While 
generally authorizing the President to carry out deferrals, see 2 
U.S.C. 684 (1982), the Act prohibited the President from engaging in 
unilateral rescissions. Instead, it authorized the President to propose 
rescissions to Congress under a mechanism for expedited legislative 
consideration. 2 U.S.C. 683 (1982).
    In sum, when Congress has passed lump-sum appropriations bills, or 
when it has given the President general authority to reduce government 
spending below appropriated levels, Congress has largely freed the 
President to exercise his own judgment regarding which spending 
programs to reduce and how much to reduce them. And while the scope of 
authority vested in the President has varied in response to changing 
legislative judgments about the need for Executive Branch discretion, 
the extent of the Executive's spending discretion has always been 
regarded, both by Congress and by the courts, as a matter for Congress 
itself to decide through the legislative process.
    The Supreme Court in Clinton acknowledged Congress's venerable and 
noncontroversial practice of vesting the President with ``broad 
discretion over the expenditure of appropriated funds,'' but it 
concluded that the President's cancellation power under the Line Item 
Veto Act crossed the constitutional line between discretionary spending 
authority and lawmaking: ``The critical difference between [the Line 
Item Veto Act] and all of its predecessors . . . is that unlike any of 
them, this Act gives the President a unilateral power to change the 
text of duly enacted statutes.'' 524 U.S. at 446-47. In contrast, 
nothing in the Legislative Line Item Veto Act of 2006 even arguably 
grants the President the unilateral power to change the text of a duly 
enacted statute. Indeed, the deferral authority that would be vested in 
the President under the bill is actually narrower than the spending 
discretion that Congress has accorded the President on numerous 
occasions throughout the Nation's history. Again, a deferral under the 
Bill can last no more than 180 calendar days, and immediately 
thereafter the President is obliged to execute the spending or tax 
provision for which he has unsuccessfully sought congressional 
rescission. The possibility that the appropriation authority could 
lapse during the period in which spending has been deferred is of no 
constitutional moment, as the historical precedents described above 
make clear.
    The constitutional validity of the President's deferral authority 
under H.R. 4890 can be brought into sharper focus by hypothesizing an 
appropriations statute in which each individual spending or tax benefit 
item is accompanied by its own specific proviso authorizing the 
President to defer its execution for up to 180 days pending 
congressional resolution of a presidential rescission proposal. Surely 
no one would question the constitutional authority of Congress to 
condition the expenditure or obligation of federal funds in this 
matter. The bill would merely make such presidential deferral authority 
generally applicable rather than specifically targeted. And it is clear 
that the President's deferral authority under H.R. 4890 would act only 
as a default rule, for nothing in the bill purports to prevent Congress 
from determining that the President's deferral authority shall not 
apply to a particular spending or tax benefit measure or any portion 
thereof in the future. See Raines, 521 U.S. at 824 (Congress may 
``exempt a given appropriations bill (or a given provision in an 
appropriations bill) from the Act.'').
    The short of my testimony is this: The Supreme Court's decision in 
Clinton recognizes and enforces the constitutional line established by 
Article I, Section 7, between the power to exercise discretion in the 
making, or unmaking, of law and the power to exercise discretion in the 
execution of law, which in the spending context has historically 
included the power to defer, or to decline, expenditure of appropriated 
funds. Congress cannot constitutionally vest the President with the 
former, but it can the latter, and has done so repeatedly throughout 
our Nation's history. In my opinion, the powers granted the President 
under the Legislative Line Item Veto Act of 2006 fall safely on the 
constitutional side of that line.
    Again, Mr. Chairman, I appreciate this opportunity to share my 
views with the Subcommittee.
    1 Continuing to defer execution of a spending or tax provision 
after a rescission proposal is voted down by one or both Houses of 
Congress would presumably not further, except in the most unusual of 
circumstances, the purposes of the Act. Statutorily requiring or 
triggering termination of the deferral, however, on a negative vote on 
the President's rescission proposal in either House of Congress would 
raise a serious constitutional issue under Chadha, which held that any 
action by Congress that has ``the purpose and effect of altering the 
legal rights, duties, and relations of persons . . . outside the 
Legislative Branch'' is a legislative action that must conform to the 
bicameralism and presentment requirements of Article I, Section 7, of 
the Constitution. INS v. Chadha, 462 U.S. 919, 952 (1983). As framed in 
the bill, however, the deferral provisions would not raise this concern 
under Chadha even if the President felt bound in good faith (as he 
presumably would) to terminate any deferral at the moment that either 
House voted down his rescission proposal.

    Mr. Chabot. We appreciate all the witnesses' testimony. The 
Members of this panel up here now will have an opportunity to 
ask questions and we will try to stay within the 5-minute rule, 
as well, and I recognize myself for that purpose at this time.
    Congressman Ryan, let me start with you, if I can. In your 
written testimony, you state that the current rescission 
procedures in the Impoundment Control Act of 1974 have been 
largely ineffective at controlling Congressional spending. How 
would your bill encourage greater fiscal restraint and prevent 
wasteful spending?
    Mr. Ryan. In one major way. Congress couldn't ignore it. 
The President can send a rescission authority. Let's just 
assume we have divided Government. We've had these requests 
before. President Reagan sent to Congress a large rescission 
request. Congress just ignored it. Under this system, Congress 
can't ignore it. Congress has to act on it and deliberate. 
Congress will have the final say so with a majority vote in 
both Houses, but Congress will have to act on these rescission 
requests within 10 days of introduction.
    Mr. Chabot. Thank you very much.
    Congressman Kennedy, let me move to you at this point, if I 
can. As you note in your testimony, your proposed 
constitutional amendment has the advantage of clearly being 
constitutional. Could you please amplify your remarks on how 
your approach would differ from the line item veto that was 
found unconstitutional in the Clinton case, as we have 
previously referred to, as well as the line item veto that 
we're referring to here today, the act?
    And then, finally, Congressman Phil English had talked to 
me a number of times over the years about his line item veto, 
and I think Congressman Andrews also had one, and I believe 
Bill Archer had one years ago, as well. Is yours along those 
lines or are there differences, and if you don't know, we can 
follow up on that later.
    Mr. Kennedy. Well, Chairman, I don't really understand the 
key differences between some of the other ones you mentioned, 
but let me just say relative to the Clinton veto power that was 
set aside by the Supreme Court, this, being a constitutional 
amendment, therefore would be constitutional, but the 
difference is that it lets you reach within the non-legislative 
text of the bill and instead of having to veto a whole 
category, can dip down and more easily find the specific item 
to veto. So it has that improvement for really targeting the 
need to control spending, which I think is also shared in 
Congressman Ryan's proposal, as well.
    The difference, I think, was really outlined by Mr. Cooper. 
Whereas under this constitutional amendment, once the President 
vetoes it, it is vetoed and no longer would have effect, 
Congress would have to act in order for that to be put back 
into place, would have to pass new legislation, whereas under 
Congressman Ryan's approach, there would be still the need for 
Congress to act or, in fact, the spending item to be 
terminated, and that would be the key differences between 
Congressman Ryan and my own.
    Mr. Chabot. Thank you very much.
    Ms. Firvida, let me turn to you, if I can. In your written 
testimony, you argued that a line item veto might have little 
budgetary effect. Is it your position that such savings, 
regardless of their size relative to an admittedly astronomical 
Federal budget, are just not worth having?
    Ms. Firvida. No. I think the point that we are trying to 
make is that it is not worth assuming the risk of violating the 
Constitution, especially when the savings are so limited. It is 
never justified to, of course, pass an unconstitutional act, 
but especially when what is before you is balancing a proposal 
that might present these constitutional questions and you are 
looking at limited savings, that should really give everyone 
pause.
    In addition, there already exists many constitutional means 
of reducing the deficit. For example, the President easily 
could veto bills, but for reasons that I would not want to get 
into because I don't know what they are, he does not. 
Certainly, Congress in its rulemaking capacity could reinstate 
some budget rules that were very effective in the mid-1990's 
and were not declared unconstitutional, like the pay-go rule, 
and that would result also in greater savings.
    So there's any number of constitutional tools available 
that we know save more money than this one, and this one may 
present constitutional issues and may not save that much money.
    Mr. Chabot. Thank you, and let me conclude with you, Mr. 
Cooper, in the time that I have remaining. I think you've had 
the opportunity to review in the Congressional Research Service 
their critique of this particular piece of legislation. Could 
you comment on two issues that were raised in that report? One, 
should there be a limitation on the President's ability to 
submit multiple rescission requests with respect to a single 
item of spending? And second, is the President's 180-day hold 
on funds automatically terminated upon Congress's rejection of 
the President's rescission request?
    Mr. Cooper. First, with respect to your first question, 
it's not altogether clear to me that the President would have 
authority to submit a second or serial rescission proposal with 
respect to the same item. The statute doesn't prohibit that, 
but it certainly doesn't explicitly authorize it and it's--I 
think it could be interpreted as being possibly inconsistent 
with the general purpose of this measure.
    But assuming that the President would have discretion to 
submit such serial proposals, whether or not Congress should 
prevent that from happening, it seems to me that is entirely up 
to Congress as a matter of policy. I think Ms. Firvida has 
identified some scenarios under which a willful President could 
abuse the authorities that this statute affords to him in a 
method that--in a manner that a limit on the President's 
ability to send serial proposals would prevent.
    By the same token, one might be able to envision a 
situation in which a President would be perfectly in good 
faith, even after, say, a body in Congress had negatively voted 
on one of his rescission proposals, to resubmit it, and that 
would be if some unusual circumstance took place to change 
the--possibly change the legislative attitude with respect to 
that matter.
    Mr. Chabot. Okay. Thank you very much. My time has expired.
    The gentleman from New York is recognized for 5 minutes.
    Mr. Nadler. Thank you. Congressman Ryan, you talked about 
the abuse where we never have the opportunity to vote on things 
because they're put in at the last moment in the conference 
Committee and we can only vote yes or no. But isn't the simple 
way to fix that to amend the rules of the House so that you 
can--so that, in fact, our rules are followed, which they 
haven't been because they're waived all the time, and the 
conference Committee can only deal with conferenceable items, 
that is, items where the two Houses differ----
    Mr. Ryan. Yes.
    Mr. Nadler [continuing]. And that nothing can be put in 
that wasn't in one House or the other at that point?
    Mr. Ryan. I think there are a number of things we can do to 
address those issues. We call these air-dropped earmarks. That 
is something that wasn't in the House or the Senate----
    Mr. Nadler. Air dropped?
    Mr. Ryan. Yes.
    Mr. Nadler. So why don't we just prohibit air drops, 
period, never mind earmarks in the conference----
    Mr. Ryan. Because I think there are situations that arise 
where Congress needs to maintain its discretion. And we are not 
talking about just appropriation bills. We are talking about 
tax legislation, we are talking about authorization legislation 
where new evidence may come to light--when you pass a bill 
through the House and the Senate and go to conference, that can 
take an entire year. Congress probably, I believe, needs to 
have the discretion to be able to address circumstances that 
occur in those times in conference reports.
    Mr. Nadler. Let me just say----
    Mr. Ryan. To ban the ability of Congress to put something 
in a conference report----
    Mr. Nadler. Let me just say I disagree with you. We break 
those rules routinely, but we shouldn't, and I think if 
something happens, you should go back to the House and the 
Senate.
    Second question, Congressman Kennedy. Your testimony is 
that we shouldn't be surprised that the spending is projected 
to reach an all-time high of $23,000 per household with $3,800 
to be borrowed, but given what Congressman Scott pointed out, 
that the earmarks, which is what you're talking about, are less 
than 1 percent of the budget, isn't this a red herring, as if 
the earmarks are really a substantial part of the deficit case 
when the real problem is either that we're overall spending too 
much or that we're, not with earmarks but overall, or that our 
tax cuts are too high? In other words, if you took care of all 
these earmarks, you're dealing with 1 percent of the problem.
    Mr. Kennedy. I would agree with what Congressman Ryan said 
before, that there's a cultural issue there that says, are you 
for more spending or are you for less spending, that it would 
have a chilling effect on some of the non-earmarked ones where 
they just wouldn't bring it forth.
    You brought up some other budget control measures that we 
ought to be looking at it in terms of identifying who has 
requested an earmark and those other things.
    Mr. Nadler. We should.
    Mr. Kennedy. But if you look at, for example, the 
impoundment authority, really, the line item veto is kind of 
impoundment authority on a diet. We need to make sure that when 
you're looking at which way do the rules tilt, do they tilt 
toward more spending or less spending, that it is putting some 
constraints----
    Mr. Nadler. Okay. I hear your answer----
    Mr. Kennedy [continuing]. On spending and this is a step in 
the right direction----
    Mr. Nadler. Let me just say that I think the rules should 
not tilt toward more spending or less spending. The rules 
should tilt toward transparency. People should vote for 
Congressmen they want to who will do more or less spending, as 
the people want. The President, ditto. And it ought to be 
transparent and Congressmen ought to be able to vote on these 
things and not have them air-dropped into conference reports at 
the end. The rules should not tilt, because when the rules tilt 
one way or another, you are inhibiting the democratic ability, 
with a small ``d'', of people to get what they want out of 
Congress and the President.
    Mr. Kennedy. In----
    Mr. Nadler. That's not a question, it's a statement, 
because I want to ask a few more questions.
    Ms. Firvida, could you discuss briefly the kinds of 
programs that might be vulnerable under this legislation? Is it 
limited to earmarks in appropriations bills?
    Ms. Firvida. No. This extends current rescission authority 
to a far broader set of spending programs, including 
entitlement programs like the SCHIP program, like the food 
stamps, other programs that--anything, essentially, that is 
reauthorized after the enactment of this line item veto would 
be subject to that power as long as it had some budgetary 
effect. In other words, it would not even have to result in new 
spending. It would not need to be a new benefit.
    Mr. Nadler. Right. So it would just tilt the power to the 
President in that. How could this bill be applied in the tax 
arena, Ms. Firvida?
    Ms. Firvida. There are provisions here that would get to 
some targeted tax breaks. However, the term is so narrowly 
defined--for the benefit of fewer than 100 individuals--that 
almost no tax benefit, if it was carefully crafted by the 
appropriate Committees would ever meet that definition. And, in 
fact, we know that the Joint Committee on Taxation analyzed 
this very definition, which was in the veto of '96, and stated 
that it was so vague and poorly defined, it was problematic.
    Mr. Nadler. Let me ask Congressman Ryan the last question 
I'll have time to ask, which may illustrate what Ms. Firvida 
was just saying. In your bill, Congressman, you have on page 15 
two provisions. You say, the term targeted tax benefit means 
any revenue losing provision that provides a Federal tax 
deduction, credit, exclusion, or preference to 100 or fewer 
beneficiaries, et cetera. And then a few lines down, you say, a 
provision shall not be treated as described in the paragraph I 
just read if the effect of that provision is that all persons 
in the same industry or engaged in the same type of activity 
receive the same treatment. That sounds wonderful.
    However, a special tax benefit given to the oil industry, 
it is given to fewer than 100 beneficiaries because there are 
less than 100 large oil companies. There are, in fact, five or 
six of them. And yet if ExxonMobil and Shell were treated the 
same way, or engaged in the same type of activity and received 
the same treatment, it would seem that a special tax break that 
would be given only to the five big oil companies or to the--
well, to the five big oil companies or to the entire industry--
--
    Mr. Ryan. Sure.
    Mr. Nadler [continuing]. Would not be subject to the line 
item veto.
    Mr. Ryan. No----
    Mr. Chabot. The gentleman's time has expired, but you can 
answer the question.
    Mr. Ryan. No, ExxonMobil has thousands of shareholders. 
Those tax benefits would accrue to all those shareholders, so 
it wouldn't--this doesn't limit it to, say, five oil 
companies--individual people, taxpayers, shareholders.
    Mr. Nadler. But the benefit----
    Mr. Ryan. A tax benefit like that----
    Mr. Nadler. But the benefit goes to the company, not to the 
individuals.
    Mr. Ryan. No, the way our legislative counsel--the 
intention of this and our interpretation of this is that we are 
talking about individuals. It would not apply in a case like 
that where you're talking about, say, five companies. We're 
talking about individuals.
    Mr. Nadler. That's not what it says.
    Mr. Ryan. As a Member of Ways and Means, I can tell you, 
there are tax laws that pass that accrue to small numbers of 
individual taxpayers. Those are the targeted types of tax 
breaks that we're talking about.
    Mr. Nadler. But it doesn't say individuals. It says 
beneficiaries.
    Mr. Ryan. That is what--that is the intention and our 
interpretation of that language.
    Mr. Chabot. The gentleman's time has expired. Never argue 
with a Member of the Ways and Means Committee on a tax issue.
    Mr. Nadler. Whether he is right or wrong.
    Mr. Chabot. Whether he is right or wrong is right. 
[Laughter.]
    The gentleman from Arizona, Mr. Franks, is recognized for 5 
minutes.
    Mr. Franks. Thank you, Mr. Chairman. You know, there was 
some previous discussion related to the tax breaks that passed 
in this Congress as having a negative effect, and it just 
occurred to me that that debate is really over, given the fact 
that we have nearly $100 billion more in revenues than we did 
prior to those tax breaks. I just--it occurs to me that that's 
the way that we really affect the deficit, is to spur the 
economy to greater productivity and greater tax revenue.
    Having said that, Ms. Firvida in her testimony said that a 
line item veto might have little budgetary effect and cites as 
evidence the fact that President Clinton only effected savings 
of about $600 million over 5 years with his use of the line 
item veto. Of course, the Wall Street Journal and others have 
said that it might do a lot more. But none of these really 
amounts to anything more than $2 or $3 billion. But you have 
given testimony that you think that the ancillary effects could 
be significantly more than that. Could you just go ahead and 
reexpand on that a little?
    Mr. Ryan. Sure. Two points I would make. Number one, there 
are a lot more earmarks these days than there were in those 
days.
    Number two, it depends on the President. It depends on who 
the President is and how aggressive they want to go after 
individual line item spending provisions, tax provisions. If 
the President is aggressive and pursues this aggressively, the 
President can save billions of dollars. If the President 
chooses not to use it, he can't.
    One more point on this, on foods like SCHIP and things like 
that. Congress will have the final say so. If Congress passes a 
broad-based program like refundable tax credit for low-income 
taxpayers, if they pass SCHIP for health care for low-income 
children, that's a bill Congress passes. If the President tries 
to veto that, Congress by a simple majority will rescind that 
veto.
    So again, I do not believe this tips the power in the hands 
of the President. This preserves the power of the Congress, but 
it gives the President and the Congress the ability to go after 
wasteful spending items with a scalpel instead of a meat axe 
and vetoing an entire piece of legislation.
    Mr. Kennedy. And if I may add, if you take the Clinton 
example as the only case you are looking at, I think the number 
is close to $2 billion. But again, you have got a comparison 
there from a Republican Congress versus a Democrat President. 
If you had the reverse of that, you might see that there might 
be a dramatically higher impact from having this power.
    Mr. Ryan. Good point.
    Mr. Franks. Congressman Kennedy, let me just ask you, then, 
constitutional amendments are pretty notoriously difficult to 
pass and certainly you have the advantage, once it passed, the 
constitutional argument goes away because it becomes part of 
the Constitution itself. Having said that, do you favor the 
passage of H.R. 4890 along with the effort to pass your 
constitutional amendment?
    Mr. Kennedy. I absolutely favor the proposal that 
Congressman Ryan has put forth, but I would also suggest that 
if you look at the impoundment authority that the President had 
for 200 years, it would grant far broader ability for the 
President to control spending than even what Congressman Ryan 
is proposing. That would be something that was within our power 
to rescind what we took away from the President that he had for 
200 years as part of the 1974 Budget and Impoundment Act and 
something, if we are not going to go the full length of a 
constitutional amendment, some further step that we ought to be 
taking to keep control of spending.
    Mr. Franks. Maybe just to expand that, would your 
constitutional amendment apply only to discretionary spending 
or could the President use it, the authority, to strike new 
mandatory spending or perhaps ongoing mandatory spending 
related to the so-called entitlements and the special interest 
tax breaks, and if so, how does it differ from Congressman 
Ryan's bill?
    Mr. Kennedy. My interpretation of it is that it would apply 
to both discretionary as well as mandatory. As crafted, though, 
Congressman Ryan's goes further in having the ability to reach 
into specific tax proposals and rescind those, as well.
    Mr. Franks. Thank you. Mr. Cooper, I might get this last 
question with you, sir. You indicate that the fact that an 
appropriation authority of this type could lapse during the 
180-day period in which the President is authorized to defer 
spending is of, quote, ``no-constitutional moment.'' Can you 
give the less intelligent among us a little explanation of 
that?
    Mr. Cooper. I am happy to try to do that, Congressman. The 
central point of my testimony is that Congress has throughout 
history given the President the power not to spend. And when he 
doesn't spend, the money doesn't leave the Treasury. And so the 
basic proposition is that if through operation of this 
mechanism Congress, with eyes wide open, created a mechanism 
through which the President through the good faith exercise of 
his discretionary powers ends up suspending a spending measure 
while Congress is considering it and the authority to spend 
expires during that period, it is the equivalent of the 
President simply exercising his discretion which Congress could 
give him not to spend at all. That's the reality of it.
    The difference is this. The President could spend--could 
exercise his discretion, which this body would give him, to 
spend right up until that moment. That was not true under the 
Line Item Veto Act. After the President canceled the law on the 
sixth day, he could not change his mind. The only thing that 
could change that was this body passing a new law. Here, the 
President has that authority right up until this body acts to 
rescind the statute, if it decides to do that, or by operation 
of the spending provision itself, the authority lapses. But 
either way, the law is in place. It's in full force and effect.
    Mr. Chabot. The gentleman's time has expired.
    Mr. Franks. Thank you, Mr. Chairman.
    Mr. Chabot. Thank you. The gentleman from Virginia, the man 
with the charts, Mr. Scott, is recognized for 5 minutes.
    Mr. Scott. Thank you. Thank you, Mr. Chairman. Mr. 
Chairman, we keep talking about the President can only sign or 
veto. He can actually veto and resend the bill back with 
instructions, like I told you I wasn't going to sign a bill 
with more than $100 billion in it. You sent it $110. Here is a 
veto. Get $10 billion out and I will sign it. Or, he can say, I 
will sign it with these provisions not in it. Just give the 
message back and you are essentially right back where we are if 
one of these things had passed. So he can do pretty much, if 
the President really wanted to get tough on the budget, then 
create this purple line up here, as President Clinton did, 
vetoing it, even closing down the Government if you keep 
sending back stuff he's not going to sign, or you can just sign 
what's sent to you and get that red line.
    Let me ask a question. Mr. Ryan, you say he could line item 
veto the narrow special interest tax cuts. What about a big, 
fat, irresponsible tax cut? [Laughter.]
    Mr. Ryan. If it's a big, fat, irresponsible tax cut that 
applies to 100 or fewer beneficiaries, the answer is yes. If 
it's a big, fat, irresponsible tax cut that he did sign into 
law that applies to more than that, the answer is no. I just 
wanted to be clear with you.
    Mr. Scott. I'm sorry. He could not veto a big, fat, 
irresponsible----
    Mr. Ryan. Well, he can veto an entire tax bill. He wouldn't 
be able to line item an individual tax cut within a tax bill 
that applied to more than 100 beneficiaries. Shareholders are 
beneficiaries----
    Mr. Scott. Just to be clear, if he gave--if we sent up 
there a provision that had a tax cut just for ExxonMobil, 
nobody else----
    Mr. Ryan. Well, remember, ExxonMobil has shareholders. It's 
a publicly-traded company.
    Mr. Scott. Okay. So he couldn't line item that. So Exxon--
--
    Mr. Ryan. I don't know how you would write--I literally 
would not know how you would write a tax cut to apply to just 
ExxonMobil unless you literally put in law only ExxonMobil gets 
this tax cut.
    Mr. Scott. You can do it that it applies----
    Mr. Ryan. I write a lot of tax bills, I can tell you.
    Mr. Scott [continuing]. To only those oil companies with 
revenues over--with profits more than $40 billion. It would 
only apply to ExxonMobil. They get the big fat tax cut. That 
would be okay. He couldn't touch it because they've got more 
than 100 shareholders.
    Mr. Ryan. Well, if you're passing a tax bill like that, 
then you'd pass a tax cut for ExxonMobil. Congress would have 
to pass that. Then the President would have to sign that. You 
basically would have that power to veto it by signing it or not 
signing it in the first place.
    Mr. Scott. If it was just part of the bill. When you talk 
about these earmarks and the fact that they cost $20-some-
billion, a lot of the earmarks are earmarks that out of the 
$300 million, $1 million goes to this project. That is a 
million-dollar earmark. If you didn't have that earmark, you 
would still have the $300 million, so you didn't save any money 
or spend any money more than would be spent, is that right?
    Mr. Ryan. Sure. In your example, yes. I think the issue at 
stake here is the culture of Congress and a culture that is 
growing where, to borrow a phrase from a Senator from Oklahoma, 
earmarks are the gateway drug to more spending. I think 
earmarks and the proliferation of earmarks are----
    Mr. Scott. The point I am making, just----
    Mr. Ryan [continuing]. Putting a bias toward much, much 
higher spending in Congress, and I think that bringing more 
transparency and accountability to the earmarking process will 
do more than just cut out wasteful earmarks. I think it will do 
a lot to bring more transparency and accountability to all of 
the dollars we spend.
    Mr. Scott. Which means, in answer to my question, just 
because you have an earmark did not mean you increased 
spending. If out of the $300 million, $1 million goes to my 
special project----
    Mr. Ryan. If you got rid of the $1 million earmark, you 
would then spend $299 million and you would reduce spending.
    Mr. Scott. No, you would spend the $300 million and I just 
wouldn't be guaranteed at getting the first million.
    Mr. Ryan. It depends on how you write it.
    Mr. Scott. That is how they are written a lot.
    Mr. Ryan. Well, just to answer your question specifically, 
if there's a $300 million spending bill and there's a $1 
million earmark in it, the President sends the rescission on 
the $1 million, Congress passes that rescission, then you save 
$1 million and you end up spending only $299 million.
    Mr. Scott. Does this bill allow you to reduce the spending, 
or you have to eliminate the whole line? Do you have to 
eliminate the whole line?
    Mr. Ryan. I don't understand the question.
    Mr. Scott. Can you reduce the item, or do you have to 
just----
    Mr. Ryan. Oh, no, it is eliminate. Yes. You can't change 
the spending numbers. Right. You mean, so could you make the $1 
million a $500,000 earmark?
    Mr. Scott. Yes.
    Mr. Ryan. No.
    Mr. Scott. Okay. Ms. Firvida, you said you might actually 
increase spending. What in the legislation would produce that 
result?
    Ms. Firvida. Well, it goes a little bit to this problem of 
the culture of spending that Congressman Ryan is talking about. 
The culture would change in the following way, and we already 
see this in the State legislatures. The President, by simply 
threatening veto action, can essentially exact a legislation 
tax from Congress and say, I will not line item these 
particular projects or these important compromises that you 
have reached in your bill as long as you give me my spending 
priorities, and overall, spending increases because the 
President gets his spending priorities and Congress continues 
to maintain their spending priorities. This is a dynamic that 
is a recipe for disaster and increased deficits.
    Mr. Chabot. The gentleman's time has expired.
    The gentleman from Florida, Mr. Feeney, is recognized for 5 
minutes.
    Mr. Feeney. I thank all of you for your testimony.
    Congressman Ryan, on your bill, since one Congress can't 
bind a future Congress, and even in Mr. Cooper's testimony on 
page 13 he says that Congress may exempt any given 
appropriation bill or a given provision from the act, I mean, 
theoretically, every appropriations bill we see in the future 
may contain some phrase that basically says, you know, 
notwithstanding any provision of the Congressional Impoundment 
or Control Act as amended by the Ryan Act, the President is not 
able to rescind any spending in the bill herein. I mean, is 
that a practical possibility?
    Mr. Ryan. I don't think, because that would be a rule 
change. I don't think that that would be a practical 
possibility because this is a statutory change that gives the 
President the ability to pull out specific items. Then Congress 
passes a rescission bill. And so Congress will follow up with a 
new law that will rescind the taxing or taxing----
    Mr. Feeney. Well, maybe Mr. Cooper understood my question. 
Supposing we passed the Ryan Act tomorrow, and I am a 
cosponsor. I love the idea of what we are trying to get at 
here. But can't the next appropriations bill that comes down 
the pike just say, we are exempted from the Ryan Act?
    Mr. Cooper. I believe it could.
    Mr. Feeney. I think so. I think----
    Mr. Ryan. Congress can always undo what it does.
    Mr. Feeney. Yes. I think that is the point of----
    Mr. Cooper. I don't think this Congress could prevent a 
future Congress from doing exactly like that. So the lesson of 
that point, it seems to me, is that any legislation depends 
upon the good faith of all the branches.
    Mr. Feeney. Well, the Members are going to have to exercise 
some self-discipline and say things like, we are not going to 
vote for an appropriations bill that excludes ourselves from 
the Ryan proposal.
    Congressman Ryan, you said that you couldn't veto a portion 
of a spending item. On page three of the act, subsection (i), 
it says the President could send a rescission message 
concerning the amount of budgetary authority or the specific 
item of direct spending. That would imply to me, and maybe you 
will want to take a look at the language as we move forward, 
the President theoretically could veto half of the bridge to 
nowhere as opposed to the whole bridge to nowhere if we are not 
careful here. We need to decide what exactly it would empower 
him to do.
    Congressman Ryan, do you think that your bill, and for that 
matter, Congressman Kennedy's constitutional amendment, which 
is also a great idea, do you think it might have a chilling 
effect, talking about the culture in Congress, of people who 
are thinking about building a museum to Groundhog Punxatawney 
Phil or a bridge to nowhere or a railroad to nowhere? Do you 
think there may be a sort of a chilling effect? My colleague 
from New York was concerned about a road or a tunnel or a 
bridge built for a developer in his district. Do you think 
somebody in Mr. Nadler's position may be happy to know that 
there's one more whack at the apple, and not only that, but 
Congress may, in fact, discipline itself knowing that the 
President may pick on and outrage and embarrass the entire 
proposal? Maybe both the Congressmen can comment on that.
    Mr. Ryan. I believe it will have that effect because at the 
end of the process, a Member is able to slip in a spending item 
which doesn't go through general order, doesn't go through a 
hearing process, doesn't go through ordinary scrutiny, cannot 
be susceptible to an amendment on the floor, and that is where 
a lot of the more unjustifiable spending items occur. I think 
this will have the practical effect of embarrassing those 
things out because these items may have to be voted on. The 
Member will have to go to the floor to defend these things.
    There are a number of points that are brought up, if I 
could just quickly----
    Mr. Feeney. Well, I will tell you what. I will recognize 
you. This is my time's over, so I can get one more in.
    Mr. Ryan. Yes.
    Mr. Feeney. Congressman Kennedy?
    Mr. Kennedy. You know, I would say the same thing. There is 
a difference between having some talk show folks point out that 
this is ridiculous as opposed to having the President with the 
big light that shines on it saying that this is not a priority. 
So I do believe it would have a chilling effect. It would reach 
beyond just those that he vetoed and call for more responsible 
spending.
    Mr. Feeney. Madison, when he describes the separation of 
powers, actually gives credit to Montesquieu, a French 
philosopher, and even Publius, going back to Roman days. But 
separation of powers, we don't have three branches that do not 
interact. There is a lot of gray and overlap. I would like to 
point out that this is certainly true in the spending area. I 
think Mr. Cooper's entire testimony is devoted to the overlap 
between the executive and the Congress which appropriates.
    I would like to point out and then get Mr. Ryan to comment 
on my experience at the State level. Some 40 governors have 
some version of a line item veto. I once got basically, in my 
view, held hostage by a Senate President who refused to pass an 
appropriations bill unless he had certain largess equivalent in 
the State of Florida to bridges to nowhere. He had a bunch of 
them. I basically picked up the phone when I was the Speaker of 
the House and told the governor that we needed an 
appropriations bill and I was stuck, being held hostage. I 
thought that some of these things were jokes. Would he take a 
look at them?
    My governor looked at him and he said, ``You know, I think 
they're jokes, Speaker Feeney.'' I said, well, what happens if 
I pass this appropriations bill with these jokes in there? Will 
you veto it? And he said, ``Speaker, I'm not going to make a 
commitment to you. That might be a little disingenuous. But 
I'll tell you, I think they're jokes and I've got a good record 
of vetoing jokes.'' It actually helped the process move along. 
Otherwise, we might have had a long hot summer not doing an 
appropriations bill. Me knowing that we had one more whack at 
the things that Mr. Nadler was concerned about in his district 
and in a lot of Congress has been--so, Congressman Ryan, how 
else can this bill perhaps help the culture in Congress?
    Mr. Ryan. The deferral question. This has been raised quite 
a bit. It's important to remember that the President has 
deferral authority right now. He has a 45-day decision 
authority.
    Why did we pick 180 days? We chose 180 days because we 
believe we have to have a calendar deadline. My preference was 
30 legislative days. The reason I wanted to do that is because 
you have to go over recesses. Often, we have large 
appropriation bills that we pass at the end of the legislative 
session in the fall. Then we go into recess. There's 
Thanksgiving, Christmas, don't come back until January for a 
pro forma session for the State of the Union. Then in February, 
we start legislating. You have to have the ability to defer 
over those long recess periods. Otherwise, Congress could just 
stall out the clock and over-wait, you know, outlast the 
President's deferral authority.
    Now, I think that there are other ways of probably 
accomplishing this. The more important point is once Congress 
acts, the President's done. I mean, if Congress decides to 
spend the money, the money's spent. If they decide to rescind 
it, it's rescinded.
    I think a way of probably addressing this that I'm looking 
at is limiting the amount of time in which after a bill is 
passed the President could submit a rescission request to 
Congress. That's something I don't have in the bill but 
something we're looking at, which is after a certain number of 
days--the President couldn't wait 100 days and defer and defer.
    I also think there's an important part of duplication. Mr. 
Cooper mentioned our bill doesn't have a provision expressly 
repealing or preventing duplication. That is not the intention, 
to encourage duplication. I think that's obviously something we 
could figure out.
    The other thing that I think is really important are 
politics. That's the other mention. Can a President use 
leverage over a Member of Congress with this power? The 
President has all sorts of ways of using leverage over a Member 
of Congress. If the President abuses this, it will be seen as 
that abuse and Congress will act accordingly. President Clinton 
was repudiated with some of his in the mil con bill in 1996.
    So I believe that this is a tool that will be visible. It's 
a tool that the President can use to effect a culture of change 
and save taxpayer dollars. And ultimately, at the end of the 
day, Congress will have the final say so. If things are 
outright political, if things are hostage-taking political 
events, Congress will have the ability to repudiate that kind 
of activity, and I think in the end of the balance, a good 
cause will be served.
    Mr. Chabot. The gentleman's time has expired.
    Before we get to the final questioner here, Mr. Van Hollen 
from Maryland, the gentleman from New York is recognized for 2 
minutes to ask a quick question and get a quick response from 
two of the witnesses.
    Mr. Nadler. Thank you. I'd like to ask Mr. Cooper and Ms. 
Firvida the following question. Let's assume that Congressman 
Kennedy's constitutional amendment were adopted or that 
Congressman Ryan's legislation were adopted. If a Congressional 
majority had the intention to do the following, could they do 
it? Let's assume you pass the budget and it said that, with 
respect to the following 600 items, if any of these 600 items 
end up reduced, the White House budget is hereby reduced by 80 
percent. [Laughter.]
    Would that be effective or would there be something 
constitutionally stopping you? In other words, could the line 
item veto be totally frustrated by what could become boiler-
plate language in a budget where the Congress said, well, 
here's our list of things we're worried about. You touch that, 
you have no budget for the White House or for the Central 
Intelligence Agency or whatever. Would that be constitutional? 
Is there anything that----
    Ms. Firvida. For myself, I would say I would want to have 
more time to consider that, but it certainly presents some--
it's a conundrum. That presents some curious questions.
    Mr. Cooper. I, too, would---- [Laughter.]
    I would appreciate more time to consider that more 
carefully, but off the top of my head, I can't think of a 
reason why that--I can't think of anything in the Constitution 
that would prevent that, and I do think the Congress could much 
more, you know, in a much more straightforward fashion exempt 
either items within an appropriations measure or the 
appropriations measure as a whole from the reach of this bill 
in the future. That's----
    Mr. Nadler. Or this constitutional amendment, in effect?
    Mr. Cooper. No, no, it couldn't do that.
    Mr. Nadler. No, no, but under the constitutional amendment, 
could it do what I just suggested, and as a practical matter, 
make it impossible for a President to exercise the line item 
veto?
    Mr. Cooper. I was focusing on Mr. Ryan's proposal. Again, I 
would want to think that through.
    Mr. Nadler. Thank you.
    Mr. Chabot. Thank you very much.
    The gentleman from Maryland, Mr. Van Hollen, is recognized 
for 5 minutes.
    Mr. Van Hollen. Thank you. Thank you, Mr. Chairman. Thank 
you and Mr. Nadler for holding this hearing. Thank you to all 
our witnesses. I appreciate your testimony.
    Let me just ask a couple of questions, if I could, with 
respect to your proposal, Mr. Ryan, and first, let me just 
agree with many of the comments that were made by Mr. Nadler 
with respect to the air-dropping issue and the fact that if we 
were serious within our institution, without any Presidential 
activity, we could pass some rule changes that would address 
the many air drops in the middle of conference, and I think you 
acknowledged that fact.
    I am concerned about the ability of the President, who 
already, of course, has lots more tools, but giving even more 
tools with respect to the ability to exert political pressure 
on Members of Congress, and I understand your argument about 
the self-correcting aspect of that over time. I am not sure of 
that.
    But in that regard, let me ask you, as I understand your 
proposal, there is no time limit with respect to when the 
President has to submit. Why not? I mean, why let him--and 
second, if you could address the issue of at least there is 
nothing in the bill that prohibits the serial air-dropping by 
the President----
    Mr. Ryan. Sure.
    Mr. Van Hollen [continuing]. Of different provisions.
    Mr. Ryan. Those are two suggestions that I think would be 
improvements to the bill. I think the serial issue, it wasn't 
our intention to encourage it. We didn't outright specifically 
prohibit it. Mr. Cooper believes that it still may be 
prohibited, or he doesn't know if it's prohibited or not. I 
think we should just explicitly prohibit that you can't 
duplicate rescission messages to Congress. That would be an 
improvement in this bill, I think.
    I also think the time limit--we ought to insert a time 
limit as to when the President--how many days the President has 
to act, to send a rescission message to Congress. I think that 
would be an improvement in this bill, as well.
    Mr. Van Hollen. Good.
    Mr. Ryan. Another question that a lot of people have 
mentioned to me, appropriators especially, is what if the 
President sends 500 rescission requests. That is that many 
hours of debate. That is that many considerations. That is that 
many bills. They could just tie us up. I think that is a 
legitimate concern.
    So I think we need to--we're looking at different ways of 
allowing--either limiting the number of rescission messages the 
President can send to the Congress or allowing possibly some 
bundling of these things. I think there are some pitfalls in 
the way we would do that, but some bundling of these requests 
so that a President couldn't tie Congress up in the works. 
Those are the other concerns that I think are very legitimate 
that have been raised where I think we can make improvements in 
this bill.
    Mr. Van Hollen. Well, not just tie Congress up, but, I 
mean, the political mischief that would be involved with 
sending up a series of small bundles and negotiating on 
different----
    Mr. Ryan. Sure. I think there are ways of fixing those.
    Mr. Van Hollen. It seems to me one bundle, maybe.
    Let me ask you a question with the differential treatment 
here with respect to appropriation provisions and tax breaks, 
and let me make sure I understand your bill. If the President 
wanted to essentially use a veto over a tax break, the 
President could only do that with respect to tax breaks that 
benefit ten or fewer----
    Mr. Ryan. Right.
    Mr. Van Hollen. Is that right?
    Mr. Ryan. Yes.
    Mr. Van Hollen. And then there's even an exception to that 
if they're treated equally, is that right?
    Mr. Ryan. Right.
    Mr. Van Hollen. But as I understand it, with respect to 
spending provisions, there is no such numerical limit, is that 
right?
    Mr. Ryan. The intention----
    Mr. Van Hollen. Okay.
    Mr. Ryan. No, I think I----
    Mr. Van Hollen. Here's my question. I mean, as I understand 
it under this bill, if you passed a tax break that benefitted 
the 101 wealthiest people in this country, that would not be 
subject to Presidential veto. But if you passed the SCHIP bill 
to help thousands of families, low-income families, that would 
be eligible for it. And if the objective here is deficit 
reduction, it seems to me I'm not sure I understand the 
differential treatment.
    Mr. Ryan. Because there is a big difference between tax law 
and tax bills and spending law and spending bills. I think if 
you expanded that tax policy--and believe me, I'm a Member of 
the Ways and Means Committee who put this provision in there, 
not at the request of the Ways and Means Committee, I'll tell 
you that--I believe that you could radically change Congress's 
intent under the entire tax law. If you widen the scope of this 
type of tax policy where the President could veto that tax 
bill, you could substantially change the entire economic 
policy, the effect of the entire tax bill.
    It doesn't work that way with spending. On spending, the 
President has to go after a line item program and that line 
item program which Congress could choose to rescind or not to 
rescind affects that program. It doesn't affect the rest of the 
bill.
    You see, tax policy affects other tax policy. It ripples 
through the entire code and ripples through the entire economy. 
Spending policy affects that spending program and it doesn't 
ripple through the rest of the bill. Let's say it's SCHIP----
    Mr. Van Hollen. Let me just, because I don't know how much 
time I've got. I understand your argument, but if the--all 
right. Let me ask it this way. Look, the President could wipe 
out the education funding, I understand, but your whole 
argument has been----
    Mr. Ryan. Okay. Let me----
    Mr. Chabot. Thirty seconds.
    Mr. Van Hollen. All right. Your whole argument has been 
that Congress gets that extra bite at the apple.
    Mr. Ryan. Yes. The Congress----
    Mr. Van Hollen. If the President is going to exercise this 
authority to affect thousands of taxpayers, as you said, he's 
still got to come back to the Congress. So why the differential 
treatment between programs----
    Mr. Ryan. The point----
    Mr. Van Hollen [continuing]. That help lots of low-income 
people and----
    Mr. Ryan. The point of this----
    Mr. Chabot. The gentleman's time has expired, but the 
gentleman can respond.
    Mr. Ryan. The point of this is not to change radical policy 
changes and give the President the power to go after radical 
policy changes. The point is to go after pinpoint spending and 
pinpoint tax cutting or tax increasing. That's the point. So 
the point is to go after line item individual items, not to 
radically change the policy of these bills, which is what you 
would do if you broadened that definition.
    Mr. Chabot. The gentleman's time has expired.
    We want to thank the witness panel for excellent testimony, 
all four of you, this afternoon. I think on both sides of the 
aisle, Members of Congress agree that there is a spending 
problem, has been under Republican control or under Democratic 
control. We might disagree somewhat on who's more responsible 
for that, but nonetheless, it's an issue that needs to be dealt 
with and I would commend these Members of Congress for their 
efforts in doing something about it and I'd also commend these 
witnesses for participating in this discussion this afternoon.
    If there's no further business to come before this 
Committee, we're adjourned. Thank you.
    [Whereupon, at 3:30 p.m., the Subcommittee was adjourned.]

                                 
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