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Monday, October 8, 2012

Me and Dr. Walter E. Williams Against the World

In my political reading, I tend to lean toward National Review.  Since my early days of political awareness, I was a William F. Buckley, Jr. fan and remain a fan of the magazine he created.

However, it drives me up the freaking wall when I find nonsense like this on their pages: O’Malley Denies Obama Has Increased National Debt More than Any Other President and the comments found attached to the article.

What does this have to do with the great Dr. Walter E. Williams?  It seems like he and I are the only people left in America who will call bullshit on the notion that Presidents can spend any monies not appropriated by the Congress, and I will add that it is bullshit to think that Presidents can refuse to spend monies appropriated by the Congress.  One does not need a PhD in Economics to understand this, as I am living, breathing proof.

Dr. Williams brought this point up in closing his last appearance guest hosting the Rush Limbaugh radio show, several weeks before the date stamp on this post.  In a more recent column, he stated it this way (pretty darn close to the same way I have been stating it for a few years):
Who May Tax and Spend?
The first clause of Article 1, Section 7 of the U.S. Constitution, generally known as the "origination clause," reads: "All Bills for raising Revenue shall originate in the House of Representatives; but the Senate may propose or concur with Amendments as on other Bills." Constitutionally and by precedent, the House of Representatives has the exclusive prerogative to originate bills to appropriate money, as well as to raise revenues. The president is constitutionally permitted to propose tax and spending measures or veto them. Congress has the authority to ignore the president's proposals and override his vetoes.

There is little intellectually challenging about the fact that the Constitution gave Congress ultimate taxing and spending authority. My question is this: How can academics, politicians, news media people and ordinary citizens continually make and get away with statements such as "Reagan's budget deficits," "Clinton's budget surplus," "Bush's tax cuts" and "Obama's spending binge"? I know that the nation's law schools teach little about Framer intent, but I wonder whether they tell students that it's the executive branch of government that holds taxing and spending authority. Maybe it's simply incurable ignorance, willful deception, sloppy thinking or just plain stupidity. If there's an explanation that I've missed, I'd surely like to hear it.
The question about the debt is even more obvious.  Katrina Trinko and every other typing head in The Beltway just came off of a typing binge about raising the debt ceiling, followed by another typing binge about raising the debt ceiling.  The Congress raises the debt ceiling, not the President, as these writers would know if they only read their own articles strewn with Congressional Republican vs. Democrat positions on raising the debt ceiling.  Not a one of them were so dim as to suggest that the President might do it all on his lonesome.

I do remember the days when I believed what Katrina Trinko and others believed, that the Congress passes budgets but the President does the spending, followed by the flawed logic that Presidents can spend whatever they like or refuse to spend federal funds on things they don't like.  Part of this was true in practice before 1974.  Presidents, up until Nixon, were able to impound Congressional appropriated funds on a whim.  Not any more.

Yes, the President usually submits a budget annually.  The Congress can, and usually does, ignore that budget before passing their own.  As on many things, the Congress has the last word.  In recent years, the Congress has not even bothered passing a budget, relying on Continuing Resolutions to direct spending.  In essence, the Congresses since 2008 have left federal spending on autopilot.  However, there is a bigger problem which Dr. Williams writes well in the above linked article.
Believing that presidents have taxing and spending powers leaves Congress less politically accountable for our deepening economic quagmire. Of course, if you're a congressman, not being held accountable is what you want.
Apparently the legions of National Review writers and commentators like it that way too.  Just go take a peek at the responses to my comments when I expressed exactly the same notions as Dr. Williams.

The Senate's version of fiscal law history is here.  The key element for the modern American is this bit:
Two developments provided the impetus for the enactment of the Budget Act in 1974. One development was an increasing realization by Congress that it had no means to develop an overall budget plan. Prior to 1974, Congress responded to the President's budget (which contains the President's many spending and revenue proposals) each year in a piece-meal fashion. There existed no framework for Congress to establish its own spending priorities before work began on specific spending and revenue bills during the spring and summer.

A second, and more immediate, cause for passage of the Budget Act was a dispute in the early 1970's regarding presidential authority to impound money appropriated by Congress. During this time, President Nixon repeatedly asserted authority (as had many of his predecessors) to withhold from Federal agencies money appropriated by Congress. By 1973, it was believed that President Nixon had impounded up to $15 billion of spending previously approved by Congress. A large portion of these funds were to have gone towards the building of highways and pollution control projects. Many in Congress disputed these actions by the President.The authorization for the pollution control projects, for example, had been enacted by Congress in 1972 with a strong vote in both Houses overriding President Nixon's veto. Nonetheless, the President impounded much of this spending. These events led Members of Congress to seek a legislative solution.

In 1974 Congress enacted the Congressional Budget and Impoundment Control Act to establish procedures for developing an annual congressional budget plan and achieving a system of impoundment control. The Budget Act also created, for the first time, congressional standing committees devoted solely to the budget. It also created the Congressional Budget Office (CBO) to serve as the ``scorekeeper'' for Congress. CBO is responsible for producing an annual economic forecast, formulating the baseline, reviewing the President's annual budget submission, scoring all spending legislation reported from committee and passed by the Congress, and preparing reports in compliance with the Unfunded Mandates Reform Act. CBO's policy with respect to providing estimates is set out in Appendix B. The Joint Committee on Taxation scores all revenue measures.
The notion that one President "spent more" or "spent less" than another is thoroughly ridiculous, since the Congress holds all of the purse strings.

One might ponder why our current President Obama could spend money on an automobile industry bailout when the Congress never authorized funds for the Chrysler bailout.  What the Congress did appropriate was funds to the Troubled Asset Relief Program (TARP), which is where the Executive illegally expended the funds from.  What it is is a misappropriation, although it may not be a deficiency if funds were still available for what the money was appropriated for.  As I have written elsewhere, every single fiscal manager in the federal government who approved any aspect, any amount of money, for the Chrysler bailout should be in jail for misappropriation.

Over at Reason, Damon Root and Jacob Sullum weighed in on the illegality of the auto industry bailouts: Why the Legality of the Chrysler Bailout Won't Matter

UPDATES:
Here are some of the places and times I have attempted to alert others to this topic, at least those I can find at the moment:
Kind of amazing how it just takes the presence of a Republican to make a deficit and the presence of a Democrat to make a surplus, even if either are just imagined.

So, according to CBS a Republican House passed this stuff without a by-your-leave to the Senate or the President. In a way it is history repeating itself from the Clinton surpluses, that apparently he created by edict without the "help" of the Congress.

I am curious, has a single person who writes this stuff ever heard of the Impoundment Control Act or the Anti-Deficiency Act? Do they have even the most remote clue that a president's budget is literally meaningless and the Executive *must spend* in accordance with the orders of the Congress? At least that is the legal way. As for all that bailout crap, there should have been some Treasury Contracting Officers up on charges for approving the car maker bailouts with financial institution bailout money (that should never have been appropriated either).
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Jonathan and his commentators are assuming too much good will from Yglesias. The Leftists never lets facts get in the way of a narrative.
OT: As far as American budgets, debt, and all of that go, I really wish that conservative columnists would take a peek at the Anti-Impoundment and Appropriations Acts of the 1970s. Then, *maybe* one side of this spending debate will stop giving credit to any president for any surplus or deficit. The Congress has been completely in charge of that since 1974.
One would think that with all the recent chatter about the debt ceiling that writers would stop tagging presidents with that one too. Wishes and horses.
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I emailed Dr. Williams and National Review about this post and received this response (nothing from NR yet):
To: John Tagliaferro <johntagliaferro@gmail.com>
Reply | Reply to all | Forward | Print | Delete | Show original
Thanks and hang in there.
Cheers.

Professor Walter E. Williams
George Mason University, Economics
4400 University Dr., MSN 3G4
Fairfax, VA 22030
On 10/8/2012 7:51 PM, John Tagliaferro wrote:

Dr. Williams (and whomever reads the mail at NRO),

It seems you and I are darn near the only people left who have read
the Constitution, to include the article typers at National Review.

Below is a clip from a recent blog post related to my upcoming book is
quoted below and I link to one of your articles. You can read the
whole thing if you like here:
http://superdupersocialism.blogspot.com/2012/10/me-and-dr-walter-e-williams-against.html

"Me and Dr. Walter E. Williams Against the World

In my political reading, I tend to lean toward National Review. Since
my early days of political awareness, I was a William F. Buckley, Jr.
fan and remain a fan of the magazine he created.

However, it drives me up the freaking wall when I find nonsense like
this on their pages: O’Malley Denies Obama Has Increased National Debt
More than Any Other President and the comments found attached to the
article.

What does this have to do with the great Dr. Walter E. Williams? It
seems like he and I are the only people left in America who will call
bullshit on the notion that Presidents can spend any monies not
appropriated by the Congress, and I will add that it is bullshit to
think that Presidents can refuse to spend monies appropriated by the
Congress.

Dr. Williams brought this point up in closing his last appearance
guest hosting the Rush Limbaugh radio show, several weeks before the
date stamp on this post. In a more recent column, he stated it this
way (pretty darn close to the same way I have been stating it for a
few years):
Who May Tax and Spend?"

Thank you for your time,
JT

Topics like this are addressed in my upcoming book, Super-Duper Socialism.

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