Impoundment Powers

The power of the president to not spend money appropriated by Congress. Until 1974, the most powerful presidential tool in overcoming the congressional funding prerogative was the power of impoundment—the president's refusal to spend funds that Congress had appropriated for a particular purpose. Historically, presidents have claimed both constitutional and statutory authority to impound funds either by treating the funding as optional, rather than mandatory, and then controlling spending authority, or by deferring spending to future years. The impoundment power is similar to the veto power in that both are attempts to block or thwart congressional actions.

One of the most famous early examples of a president's use of the impoundment power was Thomas Jefferson's (1801–1809) refusal in 1803 to spend a $50,000 appropriation for gunboats on the Mississippi River to protect the western frontier. Jefferson told Congress that the money should be used for the purchase of more advanced boats the next year. Similarly, President Ulysses S. Grant (1869–1877) refused to spend funds that Congress had appropriated for public works projects, arguing that they could be completed for less money than had been appropriated. In both cases, [Page 163]Congress accepted the president's power to refuse to spend congressionally appropriated money.

Congress eventually gave impoundment authority a statutory basis by passing the Anti-Deficiency Acts of 1905 and 1906. These laws allowed presidents to withhold funds for a period of time to prevent deficiencies or overspending in an agency. In 1921, the Bureau of the Budget established impoundment authority when its director, Charles G. Dawes, announced that “the president does not assume … that the minimum of government expenditures is the amount fixed by Congress in its appropriations.”

Under the New Deal, President Franklin D. Roosevelt (1933–1945) occasionally used impoundments for budgetary or policy purposes. In some cases, the president acted with at least the implied consent of Congress. During the Great Depression, for example, spending bills were sometimes treated as ceilings, allowing Roosevelt to refuse to spend money that he believed to be unnecessary. During World War II (1939–1945), Roosevelt argued that his war powers gave him the authority to cut spending that was not essential to national security. Presidents Harry S. Truman (1945–1953), Dwight D. Eisenhower (1953–1961), and John F. Kennedy (1961–1963) all used impoundments to cut military spending.

President Lynton B. Johnson (1963–1969), however, used impoundments to curtail domestic spending during the Vietnam War (1964–1975). As the war progressed and inflation rose, Johnson impounded funds designated for agriculture, conservation, education, housing, and transportation. These impoundments were usually temporary, and the funds eventually were released. Although Johnson did not use the power of impoundment to cripple congressionally appropriated programs, his actions did set an example of impoundment power being used to combat inflation—a power later adopted and expanded by Richard M. Nixon (1969–1974).

Both Johnson and Nixon used impoundment to control spending, but Nixon's use was unprecedented in its scope and effects. Whereas Johnson relied on temporary deferrals rather than permanent cuts and worked personally with Congress to soothe tempers, the Nixon administration's impoundments seemed designed to eliminate or to curtail particular programs favored by the Democratic Congress. Between 1969 and 1974, the administration made a determined effort to redistribute funding for government services. When Congress overrode Nixon's veto of the Federal Water Pollution Control Act Amendments of 1972, for example, the Nixon administration impounded half of the $18 billion that had been allotted for fiscal years 1973–1975, thereby handicapping the program. In addition, the Nixon administration undertook major impoundment reductions in low-rent housing construction, mass transit, food stamps, and medical research programs.

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