Isabella Carter
The power of the purse is the ability of a group to control the actions of another group by controlling their access to funding. In the United States, the power of the purse is vested in Congress, as outlined in Article I, Section 9, Clause 7 (the Appropriations Clause) and Article I, Section 8, Clause 1 (the Taxing and Spending Clause) of the US Constitution. This power has been used to limit executive power, such as in the case of the Vietnam War, and to compel states to pass laws, such as in the case of the drinking age. The power of the purse is also a feature of other governments, such as in colonial Canada and English Parliament.
| Characteristics | Values |
|---|---|
| Country | United States |
| Group with the power of the purse | Congress |
| Location in the Constitution | Article I, Section 9, Clause 7 (Appropriations Clause) and Article I, Section 8, Clause 1 (Taxing and Spending Clause) |
| Power | Control over federal taxation and spending |
| Function | A check on the executive branch |
| Historical examples | Ending the Vietnam War, limiting Ronald Reagan's military funding, the Iran-Contra affair, compelling states to raise the drinking age |
| Related laws | Antideficiency Act, Impoundment Control Act, Congressional Budget and Impoundment Control Act, Congressional Power of the Purse Act |
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What You'll Learn
The US Constitution and Congress
The US Constitution gives the Power of the Purse to Congress. This power is outlined in Article I, Section 9, Clause 7, known as the Appropriations Clause, and Article I, Section 8, Clause 1, known as the Taxing and Spending Clause. The Power of the Purse is the ability to tax and spend public money for the federal government. It is a critical tool by which Congress has limited executive power and plays a crucial role in the relationship between Congress and the President.
The Appropriations Clause establishes a rule of law to govern money contained in the Treasury, stating that no money can be withdrawn without a law appropriating it. This clause has roots in the practices of English parliaments, dating back to at least the 1690s, where they controlled the disbursement of public funds. The Spending Clause, on the other hand, grants Congress the power to lay and collect taxes, duties, imposts, and excises, to pay debts and provide for the common defence and general welfare of the United States.
The Power of the Purse can be used to control the actions of another group by withholding or stipulating the use of funds. It can be used positively, such as awarding extra funding to programs that meet certain benchmarks, or negatively, such as removing funding for a department, effectively eliminating it. In the US, this power has been used to limit executive power, such as ending the Vietnam War by eliminating military funding for South Vietnam and limiting military funding for Ronald Reagan, leading to the withdrawal of US Marines from Lebanon.
Beyond the Constitution, two key laws support Congress's Power of the Purse: the Antideficiency Act and the Impoundment Control Act. The former aims to prevent agencies from spending money they do not have, while the latter outlines restrictions on when and how an administration can withhold, cancel, or delay appropriated funds.
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The Appropriations Clause
> "No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law; and a regular Statement and Account of the Receipts and Expenditures of all public Money shall be published from time to time."
The clause establishes a rule of law governing money contained in the Treasury, which is defined as a place where public revenue is deposited, and from which payments are made to cover public expenses. The Appropriations Clause has its roots in the practices of English parliaments, dating back to at least the 1690s, where they legislated both the means of raising public revenue and the appropriation of newly raised sums to specific purposes.
The Power of the Purse has been used historically to limit executive power, such as in the case of King Charles II, whose power to engage in war efforts was curtailed by Parliament's refusal to authorise further taxes. In the context of the United States government, the power of the purse has been used to influence various policies, including the drinking age, military funding, and responses to financial crises.
In the United States Congress, appropriations bills are a key mechanism for exercising the power of the purse. These bills appropriate federal funds to specific government departments, agencies, and programs, providing funding for operations, personnel, equipment, and activities. Regular appropriations bills are passed annually and cover funding for one fiscal year. If Congress fails to pass an appropriation bill or a continuing resolution, or if the president vetoes a passed bill, it may result in a government shutdown.
The power of the purse is a critical aspect of the relationship between Congress and the President, and it plays a significant role in shaping policy and limiting executive power.
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The Taxing and Spending Clause
> The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States.
The Power of the Purse is not solely an American concept. Its earliest examples in a modern context can be found in the English Parliament, which gained the exclusive power to authorise taxes and control the nation's finances. This power allowed Parliament to curb the executive powers of the monarchy. For instance, King Charles II was restricted in his ability to engage in war efforts due to Parliament's refusal to authorise additional taxes.
In the US context, the Power of the Purse has been used by Congress to compel states to pass laws in areas where it lacks the constitutional authority to act directly. For instance, Congress passed a law withholding 10% of federal funds for highways in states that did not raise the drinking age to 21. This use of the Power of the Purse was upheld by the Supreme Court in South Dakota v. Dole.
While the Power of the Purse is a crucial tool for Congress, it has faced challenges and controversies in recent years. There have been concerns about a lack of transparency and accountability in the appropriation of funds. Additionally, the power has been at the centre of disputes between Congress and the executive branch, such as in the case of President Biden's student debt relief plan.
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The Congressional Budget and Impoundment Control Act
The ICA created a process the President must follow if they seek to delay or cancel funding that Congress has provided. It also established the House and Senate Budget Committees and the Congressional Budget Office. The Act outlines that if the President wishes to spend less money than Congress provided for a specific purpose, they must first secure a law providing Congressional approval to rescind the funding. The President is required to send a special message to Congress, identifying the amount of the proposed rescission, the reasons for it, and its budgetary, economic, and programmatic effects. Upon transmission of this message, the President may withhold certain funding for up to 45 legislative session days. If a law approving the rescission is not enacted within this time frame, any withheld funds must be made available.
The ICA defines a "deferral" as withholding, delaying, or through other executive action or inaction, effectively preventing funding from being obligated or spent. It prescribes three circumstances in which the President may propose to defer funding: providing for contingencies, achieving budgetary savings through improved operational efficiency, and as specifically provided by law. The Act has been amended several times, including provisions in the Balanced Budget and Emergency Deficit Control Act of 1985, the Budget Enforcement Act of 1990, and the Balanced Budget Act of 1997.
The Impoundment Control Act made news during the Trump impeachment investigation in 2019, when concerns arose over the withholding of approved Ukraine military funds. Emails released during this investigation showed that Acting Undersecretary of Defense (Comptroller) Elaine McCusker had emailed the White House Office of Management and Budget, expressing her concerns that the withholding of funds could be a violation of the Impoundment Control Act.
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The role of the President
The power of the purse is a term that refers to the ability of a group to control the actions of another group by influencing their access to funding. In the United States, the power of the purse is vested in the Congress as per the US Constitution, Article I, Section 9, Clause 7 (the Appropriations Clause), and Article I, Section 8, Clause 1 (the Taxing and Spending Clause).
The President's power to spend public funds has been a subject of debate and interpretation. Some, like Professor Kate Stith of Yale Law School, argue that the Constitution's Appropriations Clause prohibits the "expenditure of any public money without legislative authorization," essentially creating a legislative veto on presidential action. This interpretation suggests that Congress can use its power of the purse as a check on executive power.
However, others, like the author of "The President's Power of the Purse" on Criterion Economics, disagree with this interpretation. They argue that the President may have more flexibility in spending public funds, particularly in cases where Congress has failed to appropriate the necessary funds for the President to carry out their constitutional duties. This perspective highlights the potential for conflict between the executive and legislative branches over the power of the purse and the interpretation of the Constitution.
Additionally, the President's role in the power of the purse is also influenced by historical context and political dynamics. For example, in the case of the Iran-Contra affair, members of the Reagan administration sought to generate unofficial funds when Congress denied aid to the Contras in Nicaragua. This example illustrates how the President's actions can shape the power dynamics around the power of the purse and how the executive branch might attempt to circumvent congressional control over funding in certain situations.
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Frequently asked questions
The power of the purse is referenced in the US Constitution in Article I, Section 9, Clause 7, also known as the Appropriations Clause, and in Article I, Section 8, Clause 1, also known as the Taxing and Spending Clause.
The Appropriations Clause establishes a rule of law to govern money contained in the Treasury, including the process by which funds are appropriated and spent.
The Taxing and Spending Clause outlines Congress's power to lay and collect taxes, duties, imposts, and excises to fund the government and provide for the common defence and general welfare of the United States.
The concept of the power of the purse has its roots in English Parliament, where the power to authorise taxes and control the nation's finances was used to limit the power of the monarchy. The founding fathers of the US Constitution intended for Congress to have this power as a check on the executive branch.
