President Trump has used the Impoundment Control Act to rescind $5 billion in foreign aid and international funding. The legislation gives the president the ability to propose expedited rescissions by sending a proposal to Congress, which then has to make a decision on the proposal. This process must take place within 45 days of a continuous congressional session after the proposal is made. During those 45 days, the president can withhold the funds in question.
A pocket rescission happens when the president makes the proposal close to the end of the fiscal year, when funds expire. When the 45-day period spans the end of the fiscal year or beyond, the funds are then rescinded because they can no longer be made available after the required 45 days.
The pocket rescission method has been rarely used in history. The last president to use a pocket rescission was President Carter in 1977. Carter sent several rescission proposals to Congress in July 1977, and funds from two proposals lapsed at the end of that fiscal year. The U.S. Government Accountability Office (GAO) previously did not object to these rescissions. GAO has, however, noted that this ability of the president to impound funds is a “deficiency in the Impoundment Control Act” and has urged Congress to change this since 1975.
Congress, however, has not changed the president’s ability outlined in the ICA to use pocket rescissions or place a limit on when the president can make these proposals. The Impoundment Control Act has been used more frequently to expedite the rescissions process without the funds expiring before the 45 days pass. Each president from Ford, who was president when it was put in place, to President Clinton has used the rescission authority outlined for them in the ICA.
The most recent use of this by President Trump to rescind $5 billion in foreign aid and international funding has sparked controversy over the legality of pocket rescissions, despite previous use and statements from GAO that it is possible. In 2018, Thomas Armstrong with the GAO overruled previous inconsistent GAO opinions. According to the Independent Institute, there has long been debate about the constitutionality of pocket rescissions, but the issue has never come before the Supreme Court to make a ruling.
It is possible that, although it has been used in the past, Trump’s actions may end up before the Supreme Court to clarify the issue. As many of his actions already have, President Trump seems to be forcing decisions on topics that have been muddied for years.
Bottom Line
Clarifying the authority of the president to rescind funds that undermine the United States’ foreign policy or put the country in a financially unstable position will only benefit the American people. This gives more transparency over how tax dollars are spent. Authority to rescind funds holds Congress accountable when they spend tax dollars on efforts that do not align with American values and priorities to protect and prosper the United States before other countries.