President Donald Trump has floated the idea of pocket rescissions before, but now he’s actually giving it a shot. In an announcement on Friday, August 29, the president declared his intent to cut roughly $5 billion in foreign aid. But is it legal? The short answer is maybe. The somewhat longer but more politically comical answer might be that it depends on what the meaning of the word “is” is. You see, it all depends on how we define the term “legal” – but that’s the long answer, which will need a bit of explaining.
Trump Cuts Funding, With or Without Congress
“The Trump Administration is committed to getting America’s fiscal house in order by cutting government spending that is woke, weaponized, and wasteful,” reads the introduction to the White House announcement Friday. “Now, for the first time in 50 years, the President is using his authority under the Impoundment Control Act to deploy a pocket rescission, cancelling $5 billion in foreign aid and international organization funding that violates the President’s America First priorities.”
On the chopping block is $3.2 billion for the United States Agency for International Development (USAID), including:
$400 million per year for global climate “grift” projects, including millions for climate resilience homes in Honduras, biodiversity and low-emissions development in Africa, and hundreds of thousands for farmers and microbusinesses in Colombia.
$13.4 million for “civic engagement” in Zimbabwe.
$12,000 for “telling the USAID story” in Bosnia and Herzegovina.
The USAID and State Department’s Democracy Fund takes a $322 million hit, which includes funding to advance “inclusive democracy” in South Africa, the New Alliance for Global Equality’s drive to raise “global LGBTQI+ awareness,” and Organizing for Feminist Democratic Principles in Africa.
The Department of State loses $521 million in contributions to international organizations like the World Trade Organization, $393 million for International Peacekeeping Activities (America’s share of the UN’s peacekeeping funding), and $445 million for the Peacekeeping Operations slush fund.
How Pocket Rescissions Work
To understand pocket rescissions, one must first understand regular rescissions. The Impoundment Control Act of 1974 (ICA) allows the president to submit a “special message” to Congress asking for approval to permanently cut funding that has already been appropriated. Once this is done, the funds are put on hold until Congress has been in session for 45 days. If lawmakers vote to approve the request, the funding is revoked. If they don’t, however, then after that 45-day period, the executive branch is forced by law to spend the funds as previously directed by Congress.
So, how does this create pocket rescissions? Well, federal funding expires at the end of the fiscal year (September 30). Rescission requests don’t expire for 45 days, and Congress doesn’t have a way to vote to reject the request any sooner than that. Finally, the ICA doesn’t place any restrictions on when the president can submit such a request. So, what happens if the president requests a rescission 30 days before the end of the year?
Well, when President Gerald Ford, a Republican, did it in 1975, the year after the ICA took effect, the funding expired unspent. As the GAO noted in its report that year, “Budget authority in R76-7 and R76-8 will lapse on September 30, nearly a month before expiration of the 45 days of continuous session the Congress normally has to review proposed rescissions. Budget authority in R76-5 will lapse on October 31, only two days after the 45th day of continuous session.” Records show that the funds expiring in September did go unspent. Those expiring on October 31 were held until October 24, but then were released to be spent.
President Jimmy Carter, a Democrat, did the same thing in 1977, and the funding for both proposals he wanted cut lapsed on September 30, 1977. Both times, the president was able to hold up funds until they expired, and in both cases, the country moved on without any notable constitutional crisis.
What Does Legal Even Mean, Anyway?
The GAO has declared pocket rescissions illegal, though, because they circumvent Congress’ power to regulate spending. Read an article about pocket rescissions on just about any establishment media outlet and you’ll see that point made clearly and concisely – even in bold type, in some cases.
But there’s more to that assessment. “You may have heard of a ‘pocket veto,’ but maybe not a ‘pocket rescission,’” reads the first line of the GAO’s August 6 explainer. “In both cases, timing is key. But unlike pocket vetoes, pocket rescissions aren’t allowed.” So, who says they’re illegal? Well, that would be the GAO. Yes, the GAO cited itself, pointing to an earlier decision on pocket rescissions from 2018. Here’s an excerpt:
“At issue here is whether the ICA allows such an impoundment for fixed-period appropriations expiring during this 45-day period to continue through the date on which the funds would expire. We conclude that the ICA does not permit the impoundment of funds through their date of expiration. The plain language of the ICA permits only the temporary withholding of budget authority and provides that unless Congress rescinds the amounts at issue, they must be made available for obligation. Amounts proposed for rescission must be made available for prudent obligation before the amounts expire, even where the 45-day period provided in the ICA approaches or spans the date on which funds would expire.”
There is merit to this argument. The exact wording used in the law is: “Unless Congress completes action on a rescission bill to approve the proposed rescission within that time, the budget authority must be made available for obligation.” But there are some issues.
As previously noted, two presidents already got away with using pocket rescissions, so it’s not exactly some newfangled idea concocted by Trump. Then there’s the issue of the GAO’s actual authority. It provides reports and recommendations, but those aren’t legally binding. So, despite the way it’s being presented by many news outlets, the GAO’s declaration that something is illegal does not necessarily make it so.
Despite the GAO’s argument, one could easily argue that the ICA does, in fact, grant this authority. Again, there can be no pocket rescissions without the precise language that creates regular rescissions. It is, as the GAO put it, all about timing – and the ICA does not place any constraints on the timing of the president’s request relative to the natural expiration of funding at the end of the fiscal year. The question here, then, would be whether the ICA extends the validity of the funding beyond the fiscal year without explicitly saying so. There’s nothing in the law that says the president can’t initiate a rescission request within 45 days of the year’s end – so is he then required to spend expired money after those 45 days are up? Well, the fact that it worked for Ford and Carter suggests otherwise.
To once again quote the GAO directly – this time from a 1975 letter to Congress: “In our opinion, having to wait 45 days of continuous session before it can be determined that a proposed rescission has been rejected is a major deficiency in the Impoundment Control Act. We believe Congress should have available affirmative means within the Act to handle rescission, aside from merely waiting for the time to pass.”
The GAO of ’75, as can be seen by its own words to Congress, believed that the ICA did, in fact, create this loophole, which is called here a “deficiency.” It urged Congress to update the law and has since stuck by that position – that the ICA should be updated. But Congress has not done so, and thus America is stuck with the law as it stands, loopholes and all.
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