[Senate Hearing 111-618]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 111-618

         THE LEGALITY AND EFFICACY OF LINE-ITEM VETO PROPOSALS

=======================================================================

                                HEARING

                               before the

                    SUBCOMMITTEE ON THE CONSTITUTION

                                 of the

                       COMMITTEE ON THE JUDICIARY
                          UNITED STATES SENATE

                     ONE HUNDRED ELEVENTH CONGRESS

                             SECOND SESSION

                               __________

                              MAY 26, 2010

                               __________

                          Serial No. J-111-94

                               __________


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         Printed for the use of the Committee on the Judiciary

                  PATRICK J. LEAHY, Vermont, Chairman
HERB KOHL, Wisconsin                 ARLEN SPECTER, Pennsylvania
DIANNE FEINSTEIN, California         ORRIN G. HATCH, Utah
RUSSELL D. FEINGOLD, Wisconsin       CHARLES E. GRASSLEY, Iowa
CHARLES E. SCHUMER, New York         JON KYL, Arizona
RICHARD J. DURBIN, Illinois          JEFF SESSIONS, Alabama
BENJAMIN L. CARDIN, Maryland         LINDSEY O. GRAHAM, South Carolina
SHELDON WHITEHOUSE, Rhode Island     JOHN CORNYN, Texas
AMY KLOBUCHAR, Minnesota             TOM COBURN, Oklahoma
EDWARD E. KAUFMAN, Delaware
AL FRANKEN, Minnesota
            Bruce A. Cohen, Chief Counsel and Staff Director
              Nicholas A. Rossi, Republican Chief Counsel
                                 ------                                

                    SUBCOMMITTEE ON THE CONSTITUTION

                RUSSELL D. FEINGOLD, Wisconsin, Chairman
DIANNE FEINSTEIN, California         TOM COBURN, Oklahoma
RICHARD J. DURBIN, Illinois          JON KYL, Arizona
BENJAMIN L. CARDIN, Maryland         JOHN CORNYN, Texas
SHELDON WHITEHOUSE, Rhode Island     LINDSEY O. GRAHAM, South Carolina
ARLEN SPECTER, Pennsylvania
               Robert F. Schiff, Democratic Chief Counsel
                 Brook Bacak, Republican Chief Counsel

















                            C O N T E N T S

                              ----------                              

                    STATEMENTS OF COMMITTEE MEMBERS

                                                                   Page

Coburn, Hon. Tom, a U.S. Senator from the State of Oklahoma, 
  prepared statement.............................................    37
Feingold, Hon. Russell, a U.S. Senator from the State of 
  Wisconsin......................................................     1
    prepared statement...........................................    49

                               WITNESSES

Alexander, Ryan, President, Taxpayers for Common Sense, 
  Washington, DC.................................................    15
Carper, Hon. Thomas R., a U.S. Senator from the State of Delaware     3
Cooper, Charles, Partner, Cooper & Kirk, PLLC, Washington, DC....    13
Fraser, Alison, Director, Thomas A. Roe Institute for Exonomic 
  Policy Studies, The Heritage Foundation, Washington, DC........    17
Liebman, Jeffrey, Acting Deputy Director, Office of Management 
  and Budget, Washington, DC.....................................     7

                       SUBMISSIONS FOR THE RECORD

Alexander, Ryan, President, Taxpayers for Common Sense, 
  Washington, DC, statement......................................    24
Byrd, Hon. Robert C., a U.S. Senator from the State of West 
  Virginia, prepared statement...................................    29
Carper, Hon. Thomas R., a U.S. Senator from the State of 
  Delaware, prepared statement...................................    35
Cooper, Charles, Partner, Cooper & Kirk, PLLC, Washington, DC. 
  statement......................................................    39
Fraser, Alison, Director, Thomas A. Roe Institute for Economic 
  Policy Studies, The Heritage Foundation, Washington, DC, 
  statement......................................................    52
Liebman, Jeffrey, Acting Deputy Director, Office of Management 
  and Budget, Washington, DC.....................................    59
    statement and attachment.....................................    62
Morrison, Alan B., Dean, Public Interest and Public Service Law, 
  George Washington, University Law School, Washington, DC, 
  statement......................................................   110
Ryan, Paul, a Representatives in Congress from the State of 
  Wisconsin, prepared statement..................................   113

 
         THE LEGALITY AND EFFICACY OF LINE-ITEM VETO PROPOSALS

                              ----------                              


                        WEDNESDAY, MAY 26, 2010

                               U.S. Senate,
                  Subcommittee on the Constitution,
                                Committee on the Judiciary,
                                                   Washington, D.C.
    The Subcommittee met, pursuant to notice, at 10:05 a.m., in 
room SD-226, Dirksen Senate Office Building, Hon. Russell D. 
Feingold, Chairman of the Subcommittee, presiding.
    Present: Senators Feingold and Whitehouse.

 OPENING STATEMENT OF HON. RUSSELL D. FEINGOLD, A U.S. SENATOR 
                  FROM THE STATE OF WISCONSIN

    Chairman Feingold. I call the Committee to order. Good 
morning. Welcome to this hearing of the Constitution 
Subcommittee. This morning, the Subcommittee will review the 
legality and efficacy of expedited rescission proposals, which 
are more commonly referred to as ``line-item veto proposals.''
    Every year since I was first elected to the U.S. Senate, I 
have held listening sessions in each of Wisconsin's 72 
counties. I have held over 1,200 of them so far, and I have 
heard from tens of thousands of people across the State. And 
while over those many years health care reform has been the top 
issue discussed at these listening sessions, the need to rein 
in wasteful spending, and especially wasteful earmark spending, 
has been raised consistently. And it has never been a more 
urgent issue.
    That is why it was especially encouraging to have the 
President come forward just 2 days ago with his own proposal 
for an expedited rescission, or line-item veto, measure.
    When he took office, President Obama was handed perhaps the 
worst economic and fiscal mess facing any administration since 
Franklin Roosevelt took office in 1933. The legacy President 
Obama inherited poses a gigantic challenge.
    There is no magic bullet that will solve all our budget 
problems. Congress has to make some tough decisions, and there 
will be no avoiding them if we are to get our fiscal house in 
order. But we can take some steps that will help Congress make 
the right decisions and that can sustain the progress we make.
    A line-item veto, properly structured and respectful of the 
constitutionally central role Congress plays, can help us get 
back on track. And that is what we will explore in today's 
hearing.
    I have advocated for giving the President expedited 
rescission, or line-item veto, authority for a long time. Over 
the past two Congresses, I have been pleased to join with my 
colleague from Wisconsin, Congressman Paul Ryan, the Ranking 
Member of the House Budget Committee, in offering a proposal 
that specifically targets earmark spending. He and I have 
worked on this issue for several years. While we belong to 
different political parties and differ on many issues, we do 
share at least two things in common: our hometown of 
Janesville, Wisconsin, and an abiding respect for Wisconsin's 
tradition of fiscal responsibility.
    Now, among the many members who have joined us in that 
particular effort is the Ranking Member of this Subcommittee, 
the Senator from Oklahoma, Dr. Tom Coburn. I am delighted to 
have Senator Coburn as a cosponsor of our bill. There is no 
more energetic foe of wasteful earmark spending, and I have 
been pleased to work with him on a number of different efforts 
to rein in that practice.
    At this time I would ask that Senator Coburn's statement be 
placed in the record, without objection.
    [The prepared statement of Senator Coburn appears as a 
submission for the record.]
    Chairman Feingold. There have been a number of line-item 
veto proposals offered in the past several years. But the 
measure we proposed is unique in that it specifically targets 
the very items that every line-item veto proponent cites when 
promoting a particular measure, namely earmarks.
    When President Bush asked for this kind of authority, the 
examples he gave when citing wasteful spending he wanted to 
target were Congressional earmarks. When members of the House 
or Senate tout a new line-item veto authority to go after 
Government waste, the examples they typically give are 
Congressional earmarks. When editorial pages argue for a new 
line-item veto, they, too, cite Congressional earmarks as the 
reason for granting the President this new authority.
    While we have made some progress on earmarks, they continue 
to be a serious problem. By one estimate, in 2004 alone more 
than $50 billion in earmarks were passed. Just last year, the 
Omnibus Appropriations bill for fiscal year 2009, which passed 
in March of 2009, contained more than 8,000 earmarks costing $7 
billion. And the Consolidated Appropriations bill for fiscal 
year 2010, which passed in December, included nearly 5,000 
earmarks, costing $3.7 billion.
    There is no excuse for a system that allows that kind of 
wasteful spending year after year, and while I have opposed 
granting the President line-item veto authority to effectively 
reshape programs like Medicare and Medicaid, for this specific 
category, I support giving the President this additional tool.
    Under the bill Congressman Ryan and I proposed, wasteful 
spending would have nowhere to hide. It will be out in the open 
so that both Congress and the President have a chance to get 
rid of wasteful projects before they begin. I invited my 
colleague from Wisconsin to testify today, but unfortunately, 
his schedule does not permit him to be with us in person. He 
will submit written testimony, and we will include that in the 
hearing record.
    Of course, there are other expedited rescission or line-
item veto ideas that have merit as well. The Senator from 
Delaware, Senator Carper, who will lead off our hearing today, 
has a proposal, which he may wish to discuss. I have been proud 
to work with Senator Carper on a number of critical budget 
issues, including the restoration of the PAYGO budget rule 
which was so central to our ability to balance the government's 
books during the 1990's. He has been a true champion of 
taxpayers, and his work in this area is another example of that 
leadership.
    And then there is the President's expedited rescission, or 
line-item veto, proposal that Senator Carper and I will be 
introducing shortly. We are pleased to have Jeffrey Liebman 
from the Office of Management and Budget with us today to 
discuss the President's proposal, which is an exciting and 
important development. The President's approach includes most 
of what Congressman Ryan and I have targeted and I believe what 
Senator Carper targets in his measure as well.
    While we seek to find ways to support our goal of cutting 
wasteful spending, it is essential that any new budget tools we 
create be constitutional. That is part of the core mission of 
this Subcommittee, and to help us in this regard, we are 
privileged to have a distinguished Washington attorney and 
former Assistant Attorney General for the Office of Legal 
Counsel under President Reagan, Charles J. Cooper.
    Helping us assess the potential value a line-item veto 
might bring to budget discipline is another of today's 
witnesses, Ryan Alexander, from Taxpayers for Common Sense, a 
respected budget watchdog group. Finally, joining Mr. Cooper 
and Ms. Alexander on the third panel will be Alison Fraser from 
the Heritage Foundation.
    I look forward to an open dialog on these important 
questions, and I thank the witnesses for the time they have 
devoted and the effort they have made to be here with us today.
    At this point, of course, I would normally turn to the 
Ranking Member, who cannot be here today. He is tied up in 
another important meeting about our debt crisis. But I again 
want to thank Senator Coburn for his cooperation in organizing 
this hearing.
    So we will start off this morning by hearing from Senator 
Tom Carper. Senator Carper, thank you so much for agreeing to 
testify at today's hearing. You have been a long-time ally on 
budget issues. We have worked together on a number of different 
proposals to combat government deficits and rein in other 
fiscally irresponsible practices. Senator Carper's expedited 
rescissions bill, the Budget Enforcement Legislative Tool Act, 
or BELT Act, would significantly enhance the President's 
ability to eliminate earmarks and other discretionary spending. 
And I am delighted to be joined by Senator Carper in 
introducing the President's expedited rescissions, or line-item 
veto, proposal.
    Senator, thank you for taking the time from your busy 
schedule to be here today. I look forward to hearing from you, 
and you may proceed.

  STATEMENT OF HON. THOMAS R. CARPER, A U.S. SENATOR FROM THE 
                       STATE OF DELAWARE

    Senator Carper. Mr. Chairman, thank you so much. It is 
great to be with you. It seems like a month or two ago when you 
were good enough to come and testify before a Subcommittee that 
I chair on the Homeland Security and Governmental Affairs, 
which has a big, long title, but it is really a Subcommittee 
that focuses on waste, wasteful spending, inefficient spending. 
And we appreciated very much hearing from you that day on 
providing another tool in the toolbox for, in this case, the 
President to rein in wasteful spending, and I am just delighted 
that we are going to be able to work together going forward in 
this venue.
    If we look at our budget deficit that we face, from the 
years 2001 to 2008 we racked up as much new debt in those 8 
years as we did in, I think, the previous 208 years of our 
Nation's history. Just in 8 years, doubled our Nation's debt. 
We are on course right now, if we do not do something about it, 
to double our Nation's debt again by the end of this decade. We 
have seen from what is going on in Greece and in Europe that 
that path is not sustainable, and it is important that we 
diverge from it as quickly as possible.
    When Barack Obama was a mere mortal and he was one of us--
still one of us. In fact, his last day as a U.S. Senator, he 
had been elected President, but he gave a farewell address on 
the floor of the Senate. I was there. A number of our 
colleagues were there because we thought, well, this could be 
historic. It turned out, I think, it was. And when he finished 
his address, I had been writing down literally on the back of 
an envelope about six or seven or eight ideas that his 
administration might find helpful in terms of reining in 
deficit spending.
    Among the things that I wrote down were cost overruns in 
major weapons systems were up to about $300 billion per year by 
2008. I wrote down tax gap, the tax gap, the amount of money 
that is owed to the Treasury not being collected, roughly $300 
billion per year. I wrote down the idea of sort of like 
replicating the Greenspan Commission back in 1982 for trying to 
address Social Security.
    On that list was improper payments. We make tens of 
billions of dollars of improper payments, the Federal 
Government does, mostly overpayments. And I wrote down 
recovering monies that had been misspent, fraudulent spent, 
going out and recovering that money, not just saying, well, we 
will just scratch that off or wipe that off, but going out and 
getting the money.
    I wrote down the list surplus property. We have all this 
surplus property, thousands, tens of thousands of pieces of 
property, many of which we do not use, but we pay utilities for 
them, security for them, and it is just a waste of spending.
    I wrote those down, and before he left the floor, he was 
over talking with a page and shaking hands with all the pages. 
They wanted to shake the hand of a future President. And I 
stood in line with the pages. When he came to the end of the 
line, he reached out to shake my hand, and he said, ``You are 
kind of big for a page.'' And I said, ``Mr. President,'' and we 
walked off the floor together. I gave him my envelope, and I 
said, ``I think these are eight pretty good ideas for reducing 
budget deficits, and obviously you are going to inherit a big 
one.'' I did not know how big it was going to be. But I am 
pleased to say that if you look at some of the things that this 
administration is doing with respect to going after major 
weapons systems' cost overruns, F-22s, C-17s--which is not a 
cost overrun, but just an airplane we have plenty of and do not 
need more--tax gap, deficit commission, surplus properties, 
improper payments, post-audit cost recovery efforts. He was 
really going down the list. He said to me when he took my list, 
he said, ``You know, I cannot read your writing.'' And I said, 
``Well, we will put it in a form that you can read,'' and later 
I gave it to him.
    I do not know what ever happened to that list, but I am 
delighted to say that when we watch what this administration is 
doing, a lot of the things that were on that list they are 
actually doing. One of the things on the list was statutory 
line-item veto power, something that our Chairman has supported 
for a number of years, something I have supported literally 
since 1992. As a House member, I offered legislation. I called 
it a 2-year test drive for line-item veto power for the 
President, where the President could rescind as much as 100 
percent of spending. He would have the power for 2 years. 
Congress could override it with a simple majority in either the 
House or the Senate. It did not affect entitlement programs, 
did not affect taxes, but the idea was to really do a test 
drive for 2 years with something like line-item veto power for 
the President. Then if after 2 years the President abused the 
powers, they would go away. If he did not abuse the powers and 
it was actually effective, we could extend it for another 2, 4, 
8 years, or make it permanent.
    When I came to the Senate, George Voinovich and I a couple 
years ago introduced a version of the same bill, and we now 
have, I think, over 20 cosponsors, and I am very pleased that 
the administration has come and met with us, as I am sure they 
have with Senator Feingold and his staff, but just to say, 
``What do you think we ought to do? '' and to take ideas from 
our bill, as I am sure they have from your bill. Today we are 
going to be marrying our fortunes together.
    When I was Governor for 8 years, we had line-item veto 
power, and it was interesting. One of my former colleagues who 
was a Governor, he used to describe line-item veto power as 
having a bazooka under his desk. And he said, ``It was a 
bazooka I almost never had to use, but the legislature knew it 
was there. And if we could not talk them out of wasteful 
spending or inefficient spending, bad ideas,'' he said, ``then 
we would use the bazooka.''
    I do not know that what we are talking about is a bazooka 
under the desk, but what it is, I think, is a very helpful tool 
for this Chief Executive to use, and I would suggest that we 
provide him the power, probably not forever but for maybe 4 
years, do a test drive, see how it works. If it is abused, then 
it goes away. If it is effective or if we learn that it can 
maybe be more effective, then we have the opportunity maybe 4 
years down the road to enhance it and to improve it.
    I do know this: As much as I like the idea of silver 
bullets, I do not think there is one. I do not think there is 
one for reining in the budget deficit. Maybe if we had a magic 
wand and could sort of wave it, and all of a sudden GDP growth 
would be 10 percent a year for the next, you know, 50 years or 
even 10 years, I think that would pretty well wipe out the 
deficit.
    Unfortunately, I do not have that magic wand, and neither 
do the rest of us. What we do have are a bunch of good ideas, 
and this administration is beginning to implement a bunch of 
good ideas. And I think we have the opportunity here for us, 
for Senator Feingold and myself, and hopefully Senator 
Voinovich and Senator Coburn and others to join forces on 
another good idea, and that is, to give this President the 
opportunity to single out spending that does not make sense, 
that is inefficient, that is wasteful, and require us to vote 
on it. We can vote it--if a majority of us think that, no, that 
is reasonable spending, that is a good one, that is a good 
idea, then so be it. But I have always said on an idea of mine, 
if I cannot get 50 of my colleagues to vote with me for it in 
the U.S. Senate, then maybe we should not be spending that 
money. And I think that pertains to ideas of almost all of us.
    So, Mr. Chairman, I am delighted to be here with you before 
your Committee. I am very much looking forward to working with 
you and your team as we put together a bipartisan coalition 
around this idea, and with the support of the President, 
actually enact it this time.
    Chairman Feingold. Senator, thank you. I think this will be 
not only a terrific opportunity for us to work together on 
something we both care a lot about, but as I think you said 
yesterday, this is really a time when maybe the stars are 
aligned and we can actually get this done.
    I was struck by your comments about your experience as 
Governor with the line-item veto, because in Wisconsin, we had 
the most, if you will, extreme line-item veto where the 
Governor was able basically to use a computer and move numbers 
and letters around in a way that actually made the people of 
the State kind of squeamish about a line-item veto and fearful 
of it, and we had to modify it.
    Senator Carper. That is a couple of bazookas.
    [Laughter.]
    Chairman Feingold. And it was called the King George III 
veto.
    So what I am struck by, Senator, is how popular this idea 
is even in that context, because I, of course, reassure people 
this is not what this is. This is a much more narrow, targeted 
technique. So I really appreciate your testimony. Thank you.
    Senator Carper. It is my pleasure. Thanks so much. We look 
forward to it.
    Chairman Feingold. Now I will turn to the testimony from 
the Office of Management and Budget. Mr. Liebman, will you 
please stand and raise your right hand to be sworn in as soon 
as you are up there?
    Do you swear or affirm that the testimony you are about to 
give before the Committee will be the truth, the whole truth, 
and nothing but the truth, so help you God?
    Mr. Liebman. I do.
    Chairman Feingold. Thank you. You may be seated.
    Our first witness on this panel is Jeffrey Liebman, the 
Acting Deputy Director of OMB, where he has served as executive 
associate and chief economist. Mr. Liebman is a renowned 
economist and is currently on leave from Harvard University's 
Kennedy School of Government, where he teaches courses on U.S. 
economic policy and public sector economics. Mr. Liebman 
previously served in the Clinton administration as a Special 
Assistant to the President for Economic Policy at the National 
Economic Council.
    Sir, we appreciate you being here today and look forward to 
hearing more about the administration's proposal, and you may 
proceed.

STATEMENT OF JEFFREY B. LIEBMAN, ACTING DEPUTY DIRECTOR, OFFICE 
            OF MANAGEMENT AND BUDGET, WASHINGTON, DC

    Mr. Liebman. Thank you, Chairman Feingold, for inviting me 
to testify today about the President's new proposal, the Reduce 
Unnecessary Spending Act of 2010. And I also want to thank 
Senator Carper for his leadership on this issue.
    This legislation would create an expedited procedure that 
guarantees an up-or-down vote on certain rescissions proposed 
by the President, helping to eliminate unnecessary spending and 
discouraging waste in the first place.
    Since taking office, the administration has made a priority 
of identifying and cutting wasteful spending, proposing 
approximately $20 billion of terminations, reductions, and 
savings in both the fiscal year 2010 and fiscal year 2011 
budget proposals. While recent administrations have seen 
between 15 and 20 percent of their proposed discretionary cuts 
enacted, we were pleased to work with Congress last year to 
succeed in achieving 60 percent of the discretionary cuts that 
the President proposed in his budget. So for that, I thank you 
and your colleagues.
    Further, the administration has worked with Congress to 
curb earmarks, and the appropriations bills for this year saw a 
significant decline in earmarks--a drop of 17 percent in number 
and 27 percent in dollar value over the previous year. These 
reductions build on the progress that Congress has made on 
earmarks since 2006; reductions prompted by a series of reforms 
that then Senator Obama helped to write with Senator Coburn and 
others, which helped to bring more transparency and disclosure 
to the process.
    In this year's budget, the administration also committed to 
restraining spending more broadly and has proposed a 3-year 
freeze on non-security discretionary funding, saving $250 
billion over 10 years compared to what would happen if this 
spending grew with inflation over that time period. This 
spending restraint complements other measures in the budget 
that, together, produce more deficit reduction than has been 
proposed by any President's budget in over a decade.
    Furthermore, the administration proposed, and Congress 
enacted, statutory pay-as-you-go legislation. PAYGO forces us 
to live under a very important planning--that the Federal 
Government can only spend a dollar on entitlement programs or 
pass a tax cut if it saves a dollar elsewhere, and this 
encourages the kinds of tough choices that are going to be 
critical to putting our country back on a path toward fiscal 
sustainability.
    Significant progress has been made on cutting unnecessary 
spending, including earmarks, but more can be done. The 
President's proposal for expedited rescission would create an 
important tool for reducing such spending. In short, the bill 
would provide the President with additional authority to 
propose a package of rescissions that would then receive 
expedited consideration in Congress and a guaranteed up-or-down 
vote.
    Here is how it works.
    Under this new authority, the President can propose fast-
track consideration of rescissions of discretionary and non-
entitlement mandatory spending. The President is limited to 
proposing changes that reduce funding levels and cannot use 
this authority to propose any other changes to law. The fast-
track process is thus limited only to reducing or eliminating 
funding, for which a straight up-or-down vote is desirable.
    After enactment of funding, the President has 45 days 
during which Congress is in session to decide whether to submit 
a rescission package using this expedited procedure.
    A rescission package submitted under this authority 
receives fast-track consideration in Congress. Debate is 
limited in both Houses, and the package is guaranteed an up-or-
down vote without amendment. From the package's introduction to 
the final vote, the process can take no more than 25 days.
    Following submission of a rescission request using this 
expedited procedure, the President may withhold funding for up 
to 25 days, after which the funding must be released. This 
ensures that agencies do not obligate funds before Congress has 
had an opportunity to consider the rescission package.
    The proposal has been crafted to preserve the 
constitutional balance of power between the President and 
Congress. Under our proposal, Congress, which is empowered to 
set its own rules, changes those rules under which it considers 
rescission packages submitted by the President--using well-
established fast-track procedures. Rescissions can only occur 
if Congress enacts them into law. In other words, our proposal 
does not expand the Presidential veto authority in any way.
    A number of members from both parties, including the 
Chairman and Senator Carper who testified on the first panel, 
have introduced proposals that would, like our proposal, target 
unnecessary spending by fast-tracking consideration of 
rescissions. We applaud these efforts, and we look forward to 
working with Congress to resolve any remaining differences and 
enact this authority into law.
    Thank you.
    [The prepared statement of Mr. Liebman appears as a 
submission for the record.]
    Chairman Feingold. Thank you so much. Let me just ask you a 
few questions.
    I want to start by asking you about the practical impact of 
the proposal you have laid out. Could you give me some examples 
of the type of unnecessary spending and wasteful programs you 
are hoping that this proposal will end? How much money do you 
think something like this could save U.S. taxpayers?
    Mr. Liebman. Yes, thank you, Senator. I think there are 
several types of spending that this proposal could be effective 
in targeting. One type of spending are programs that are 
heavily earmarked or allocated on methods other than merit-
based or competitively based methods of allocating spending. 
And so the President in his budget has proposed ending several 
categories of programs of this sort.
    For example, there are State assistance grants for water 
infrastructure at the EPA, where we spend $157 million on a 
heavily earmarked program, and we have other programs where we 
address similar needs in competitive and merit-based ways. 
Similarly, there are earmarked surface transportation programs 
at the Department of Transportation. We spend $293 million on 
those programs, and, again, there are other ways to meet our 
surface transportation needs where the allocation is merit-
based. So heavily earmarked programs is one example.
    The other category of programs where I think we can achieve 
real savings from this are in duplicative programs. For 
example, we have programs at both the Department of Commerce 
and at the USDA that are supposed to fund public broadcasting, 
but we have also very effective programming through the 
Corporation for Public Broadcasting, and going after that kind 
of duplicative program could also be accomplished by this 
spending.
    In terms of the total magnitude, the President last year 
and this year proposed about $20 billion in this category of 
spending. You know, we achieved some of that working through 
the normal appropriations process. I think with this tool we 
could achieve a lot more of it. This comes back to something 
that was said in the opening remarks. It is not simply reducing 
spending after it has occurred that will be able to reduce the 
deficit through this approach; it is also discouraging people 
from proposing these things in the first place. And, really, I 
think that is probably the biggest impact of this proposal.
    Chairman Feingold. I agree with you that the deterrent 
effect is probably the most effective aspect of it.
    As you note, the President's proposal focuses only on 
rescissions of discretionary spending and on non-entitlement 
mandatory spending. It does not cover entitlement programs or 
tax expenditures of any kind.
    Now, I strongly believe that enacting a line-item veto 
measure for this sort of discretionary earmarked spending would 
be very significant on its own, but some critics might contend 
that our major fiscal challenges stem in large part from 
entitlements and tax expenditures.
    What would you say to those who want to include 
entitlements and tax expenditures in this kind of an expedited 
rescissions or line-item veto bill?
    Mr. Liebman. I think the answer to that very good question, 
Senator, is that this particular tool aims to be a very 
streamlined tool for letting us, you know, within weeks after 
discretionary or non-entitlement mandatory spending is enacted 
to go after wasteful programs. And the idea here, in order to 
keep it streamlined and very transparent, is to permit only a 
very simple thing to happen, which is spending levels for these 
programs to be reduced or eliminated altogether. And, in 
particular, the President's proposal does not allow any 
amendments to the proposal. It is just a matter of reducing 
dollar amounts.
    When one makes changes to tax or to entitlement programs, 
one typically needs to make statutory changes as part of that 
legislation because these programs are complicated, they 
interact with each other, and it is typically not the case that 
one can make a change to those programs in a simple sort of 
yes-or-no, up-or-down approach. And so we do not think this 
kind of streamlined simple approach matches well with those 
needs.
    But it is absolutely the case that if we were going to get 
control over the country's budget situation, we are going to 
have to continue to make progress not simply on the 
discretionary side, but on the entitlement side, on the tax 
expenditure side. And as you know, the President worked very 
hard to the largest fiscal challenge, controlling health care 
costs, right from the beginning of the administration, and he 
has proposed the bipartisan fiscal commission as a way to work 
on these bigger programs. So I think we need different tools 
for different tasks, and this is not a silver bullet at all, as 
Senator Carper said. This is just a way to go after one 
particular and very important aspect of the spending challenge 
we face.
    Chairman Feingold. The legislation I introduced with 
Congressman Ryan requires that any savings realized from a 
line-item veto be used to reduce our budget deficits. Is there 
a reason that feature was not included in the President's 
proposal? And do you have any objection to including it?
    Mr. Liebman. That is a good question. Under the rescission 
proposal from the President, only one thing can happen: 
spending can get reduced. There is no way to reallocate 
spending to other programs. There is no other way to introduce 
new spending into it. In the President's proposal, the direct 
effect is simply to reduce spending and reduce the deficit. But 
as you note, other proposals have gone a step further and have 
said that the discretionary spending allocation should be 
reduced by the amount of the rescissions, and we did not do 
that in this proposal because we think, although in many, and 
maybe even most cases, what one will want to happen when 
spending is eliminated through a rescission is to reduce the 
deficit and not to have that spending replaced with another 
program. In other cases, what may happen is that there may be 
ineffective programs targeting a real need where Congress wants 
to eliminate those ineffective programs, and then they want to 
come back later in the session and try to address that need 
with a more effective merit-based approach. So in drafting this 
proposal, we left that flexibility.
    That said, there are many features of this proposal, 
including this one, where we would be very happy to work with 
you and figure out whether we got it right.
    Chairman Feingold. So you do not necessarily object to 
tying that down a little more tightly.
    Mr. Liebman. No. We would be happy to work with you on 
that.
    Chairman Feingold. Thank you. As I understand it, the 
administration's proposal gives the President up to 45 session 
days after enactment of a spending bill to send a proposed 
package of rescissions to Congress, and depending on the time 
of year, as you well know, that could end up being 3 months or 
even longer. Does the administration really need that much time 
to review an appropriations bill and submit proposed 
rescissions? Could you live instead with 30 calendar days, as I 
previously proposed in my legislation?
    Mr. Liebman. The key goal of this provision and one of the 
main differences with the existing Impoundment Control Act is 
that it requires a rapid submission by the President, that it 
has to be done within 45 days, unlike the existing rescission 
authority where submissions can be delayed much later. And the 
reason we chose 45 days is that at the end of the year, in 
December or January, frequently there are large omnibus 
appropriations bills exactly at the same time that we are 
putting together the President's budget. And so if one gets one 
of these huge bills and we need the time to go through it and 
figure out exactly what is in it, do the analysis of the policy 
and figure out which things need rescissions, we thought that 
something like 45 days might well be what is needed at that 
period. Most times of the year, on smaller, more traditional 
appropriation vehicles, 45 days is longer than one needs.
    We decided to go simple and just have a single number of 
days, but one could perhaps have 45 days only for things passed 
in December or January in an omnibus procedure and a shorter 
time period on other ones.
    Chairman Feingold. It sounds like something we could work 
out.
    Mr. Liebman. Absolutely.
    Chairman Feingold. Thank you.
    I now want to ask you about the specific procedures 
governing Congressional consideration of the rescissions 
package. Correct me if I am wrong, but it appears that the 
House could avoid a direct vote on the rescissions package 
itself by defeating the motion to proceed to it. By contrast, 
the proposal for consideration by the Senate ensures that the 
rescissions package comes to the floor for debate and a vote.
    Why is the process structured the way it is in the House? 
Is there some quirk of House procedure that makes that 
necessary?
    Mr. Liebman. Well, fundamentally, the Constitution empowers 
each chamber of Congress to set its own rules, and so this 
procedure tries to respect that, and we tried to write a 
procedure that was consistent with the culture in each House of 
Congress. But, frankly, that is something we would be very 
happy to work with you on and figure out what procedures work 
best. Our goal here is quite simple. We want to have an up-or-
down vote. We want the President to have to introduce something 
quickly. We want there to be no amendments. And the details 
around that are all things that I think we can work together to 
get right.
    Chairman Feingold. For the deterrent effect on this to 
work, you and I both discussed the need for a substantive vote 
where somebody has to own keeping these expenditures important. 
It occurs to me that we do not want to have somebody have the 
excuse that they simply wanted to proceed to something else.
    Mr. Liebman. That is a good point.
    Chairman Feingold. Thank you for that candid response.
    Finally, I want you to know--and this is more of a comment 
for your reaction--that I will be pushing hard to pass the 
line-item veto as the President has proposed. You and I both 
know it will be an uphill struggle, so we will need the full 
support of the administration. So I hope you will take that 
request back with you.
    But I also have another request to pass on, and that is 
that the administration not wait until it has the line-item 
veto to aggressively challenge wasteful spending and 
unjustified earmarks. You have already mentioned some of the 
things that the administration has already done in this regard, 
and I congratulate you on that.
    Let me say this: The next time Congress sends you a massive 
spending bill, stuffed with over 8,000 earmarks totaling more 
than $7 billion, like last year's omnibus, I hope the President 
vetoes it and tells Congress to try again. Your reaction?
    Mr. Liebman. Well, I thank you for that advice. I think one 
of the reasons, clearly, why this particular authority is 
needed is that the veto pen is a very blunt instrument, and as 
you well know, one often gets a bill where 90 percent of it is 
essential, and then there is 10 percent that you wish were not 
there, and it makes it very difficult to get rid of the 
wasteful spending.
    And so, you know, I do hope we will continue to be 
successful in this year's appropriation process as we were in 
last year's appropriation process in going after wasteful 
spending, and I will certainly take your message back, and 
thank you very much.
    Chairman Feingold. Thank you, Mr. Liebman, for your 
excellent testimony. I look forward to working with you on 
this.
    Mr. Liebman. Thank you.
    Chairman Feingold. We will now turn to testimony from our 
third panel of witnesses. Will you all please stand and raise 
your right hand to be sworn in? Do you swear or affirm that the 
testimony you are about to give before the Committee will be 
the truth, the whole truth, and nothing but the truth, so help 
you God?
    Mr. Cooper. I do.
    Ms. Alexander. I do.
    Ms. Fraser. I do.
    Chairman Feingold. Thank you. You may be seated. Welcome to 
all of you. Thanks for being with us here this morning. I am 
extremely impressed with the caliber of the witnesses on this 
panel. I look forward to hearing from all of you. I ask that 
each of you limit your remarks to 5 minutes. As always, your 
full written statements will be included in the record.
    Our first witness on this panel is Charles Cooper, a 
constitutional scholar and expert on line-item veto proposals. 
Mr. Cooper served as Assistant Attorney General in the Office 
of Legal Counsel in the Reagan administration and had, I am 
told, the unfortunate and unenviable task of telling President 
Reagan that there is no legal or constitutional support for an 
inherent line-item veto. Mr. Cooper is one of the lawyers who 
was retained by several Members of Congress to challenge the 
constitutionality of the Line Item Veto Act of 1996 and is, 
therefore, uniquely suited to discuss how the 1996 Act is 
different from the legislative proposals we are talking about 
today.
    Mr. Cooper has over 25 years of legal experience in 
Government and private practice. He was named by the National 
Law Journal as one of the ten best civil litigators in 
Washington. He is a graduate of the University of Alabama Law 
School and is a founding member and Chairman of the law firm of 
Cooper & Kirk where his practice is concentrated in the areas 
of constitutional, commercial, and civil rights litigation.
    So, Mr. Cooper, thank you so much for being here today, and 
you may proceed.

 STATEMENT OF CHARLES J. COOPER, PARTNER, COOPER & KIRK, PLLC, 
                         WASHINGTON, DC

    Mr. Cooper. Thank you very much, Mr. Chairman. I very much 
appreciate the Committee's invitation to me to present my views 
on the constitutionality of the recently proposed measures 
designed to give the President an authority akin to a line-item 
veto.
    The analysis of the constitutionality of the various line-
item veto measures that have been proposed is controlled by the 
Supreme Court's decision in Clinton v. City of New York, which 
struck down the Line Item Veto Act of 1996. That Act provided 
that the President may cancel any dollar amount of 
discretionary budget authority, any item of new direct 
spending, or any limited tax benefit by sending Congress a 
special message within 5 days after signing a bill containing 
such items. Cancellation took effect when the Congress received 
the special message.
    The term ``cancel'' was defined by that Act as ``to 
rescind'' and to ``prevent...from having legal force or 
effect,'' which made it clear that the President's action would 
be both permanent and irreversible. Thus, a Presidential 
cancellation under the 1996 Act extinguished the canceled 
provision, as though it had been formally repealed by an act of 
Congress. And neither the President who canceled the provision 
nor any successor President could exercise the authority that 
the provision, before the cancellation, had granted. It could 
be restored to the status of law only if a ``disapproval bill'' 
was enacted according to the bicameral passage and presentment 
requirements of Article I, Section 7.
    In striking down the Line Item Veto Act of 1996, the 
Supreme Court in Clinton concluded that vesting the President 
with unilateral power to cancel a provision of duly enacted law 
could not be reconciled with the requirements established under 
Article I, Section 7; that is, bicameral passage and 
presentment to the President. The Court struck down the 1996 
Act because--and these are the Court's words, Mr. Chairman--
cancellations pursuant to the Line Item Veto Act are the 
functional equivalent of partial repeals of Acts of Congress 
that fail to satisfy Article I, Section 7.
    The various measures that are now pending before this body 
for your consideration are very much in contrast to that Act. 
They are framed in careful obedience, I believe, to Article I, 
Section 7, and to the Supreme Court's teaching in Clinton. The 
President is not authorized by these bills to cancel any 
spending or tax provision or otherwise to prevent such a 
provision from having legal force and effect. Instead, the 
purpose of the proposed measures is simply to provide a fast-
track procedure to require the Congress to vote up or down on 
rescissions that have been proposed by the President. In other 
words, the President's proposed rescissions are just that--
proposals. Thus, any spending or tax provision duly enacted 
into law remains in full force and effect under all of these 
measures that I have seen unless and until it is repealed the 
old-fashioned way--by this body through bicameral passage and 
presentment.
    To be sure, the current proposals--that I have seen, 
anyway--would authorize the President to temporarily defer or 
to suspend execution of the spending or the tax provision at 
issue for a single specified period of time. Now, the purpose 
of that deferral authority, obviously, is simply to allow the 
Congress adequate time to consider the President's rescission 
proposals and vote them up or down before the funds at issue 
are obligated or spent. The President would be authorized to 
terminate the deferral, however, at any time that he determined 
that continuation of the deferral would not further the 
purposes of the Act.
    So the President would be free at any time to change his 
mind--and that is critical--any time to change his mind about 
the deferred spending item or tax provision and to commit the 
funds. Likewise, if Congress does not approve the President's 
rescission proposal, the President would be required under the 
law to make the funds or tax benefits available no later than 
the end of the statutory deferral period--which, again, cannot 
exceed a single specified period of time.
    Thus, the President is authorized only to defer a spending 
or tax provision under the proposal, not to cancel or otherwise 
prevent the provision from having legal force and effect. And 
the Congressional practice of vesting discretionary authority 
such as this in the President to defer and even to decline 
expenditure of Federal funds has been commonplace since the 
beginning of the Republic, and its constitutionality has never 
seriously been questioned and, in fact, was sustained and 
confirmed in the Clinton case itself.
    So the short of my testimony, Mr. Chairman, is this: The 
Supreme Court's decision in Clinton recognizes and enforces the 
constitutional line established by Article I, Section 7, 
between the power to exercise discretion in making or unmaking 
a statute, which cannot be delegated to the President, and the 
power to exercise discretion in execution of the statute, which 
can be and has for centuries been delegated to the President. 
And, in my opinion, the provisions pending now before you, the 
one that you have introduced, the one that President Obama has 
just submitted earlier this week, seem to me to be on the 
constitutional side of that line.
    Thank you again for inviting me to share my views with you, 
Chairman Feingold.
    [The prepared statement of Mr. Cooper appears as a 
submission for the record.]
    Chairman Feingold. Thank you, Mr. Cooper, for your 
excellent testimony.
    Our next witness is Ryan Alexander, the President of 
Taxpayers for Common Sense, an organization dedicated to making 
sure that the government spends taxpayer dollars in a 
responsible, transparent manner. A graduate of Wesleyan 
University and, I am pleased to note, of the University of 
Wisconsin Law School, Ms. Alexander has dedicated her career to 
the public sector and to halting government waste. She has been 
the President of Taxpayers for Common Sense for the last 4 
years and has worked in some capacity for TCS for the last two 
decades. Prior to that, she served as Executive Director of the 
Common Cause Education Fund and co-founded the Appalachian 
Center for the Economy and the Environment. She also sits on 
the Board of Directors of the Project on Government Oversight.
    Ms. Alexander, we welcome you, and thank you for taking the 
time to be here, and you may proceed.

 STATEMENT OF RYAN ALEXANDER, PRESIDENT, TAXPAYERS FOR COMMON 
                     SENSE, WASHINGTON, DC

    Ms. Alexander. Thank you. I am also a Wisconsin native, so 
I have that fiscal responsibility----
    Chairman Feingold. What town?
    Ms. Alexander. Thiensville. Thank you for the invitation to 
testify today. Taxpayers for Common Sense is an independent and 
non-partisan voice for taxpayers working to increase 
transparency and expose and eliminate wasteful and corrupt 
spending. As many people in this room know, we have created 
databases of all appropriation earmarks for the past 6 years. 
Our mission is to achieve a Government that spends taxpayer 
dollars responsibly and operates within its means. All of our 
work stems from our belief that no one--no matter where they 
find themselves on the map or the political spectrum--wants to 
see their money wasted.
    TCS supports the Reduce Unnecessary Spending Act of 2010. 
It would establish a useful tool to cut wasteful spending 
without unconstitutionally impinging on Congress' power of the 
purse. The current appropriations process makes it difficult to 
cut unnecessary spending, as few Members of Congress will vote 
against entire appropriations bills because of individually 
wasteful earmarks or programs.
    The President's proposal would increase transparency and 
accountability of the spending process by giving the public 
more information about where their elected representatives 
stand on specific requests that are often buried in omnibus 
spending or authorization bills.
    Enactment of RUSA, for lack of a better acronym, would 
provide an opportunity for the administration and Congress to 
identify and cut duplicative or obsolete spending.
    In 2006, TCS supported the Line Item Veto Act, in part 
because we found that the number of earmarks in appropriations 
bills had increased sixfold from 1998 to 2006. At the time, we 
argued that it would enable the President to shine a spotlight 
on specific spending and tax provisions. The same logic applies 
now: it is difficult to believe that majorities in both Houses 
of Congress would publicly support many of the current 
earmarks. The 2010 appropriations bills contain almost 9,500 
earmarks worth almost $16 billion. Especially at this time when 
there are so many demands for Federal dollars, it is hard to 
believe that those provisions would all be supported.
    Congress has also become increasingly reliant on omnibus 
spending packages that wrap several appropriations bills 
together. The bills are thousands of pages long, frequently not 
available to the public for very long before they are voted on, 
and hide earmarks and other spending provisions.
    At the same time, the general recognition--outside of 
Wisconsin--that Federal spending continues to grow at an 
unsustainable rate relative to revenue has led to a series of 
mostly insufficient attempts to rein it in. PAYGO rules, which 
require that any new funding be paid for without additional 
borrowing, include an exemption for emergency spending bills, 
which can often amount to tens or hundreds of billions in 
additional spending. Moreover, emergency spending bills 
routinely contain spending that fails to meet Congress' own 
definition of ``emergency'' and are therefore often as likely 
as any spending bill to contain politically driven plus-ups, 
earmarks, or other spending. If Congress is indeed serious 
about the budget deficit, it should embrace all opportunities, 
including this legislation, to identify and cut unneeded 
spending.
    Both voters and Congress would be well served by expedited 
rescission authority. Many times, lawmakers are asked to accept 
smaller spending proposals contained within broader 
legislation. Though relatively small in the context of a 
massive spending bill, these projects may become examples of 
Government waste that damages Congress' credibility with the 
public. In some cases, lawmakers have demonstrated the ability 
to eliminate wasteful spending after sufficient public 
attention. After many, many attempts, Congress did strip 
funding for the Bridge to Nowhere in subsequent legislation, 
and more recently the so-called Cornhusker Kickback was removed 
from the recent health care legislation. Expedited rescission 
authority will potentially enable Congress to eliminate these 
kinds of fiscal stains more quickly and decisively.
    But there are other Bridges to Nowhere that pass through 
the appropriations process with very little public attention. 
Our hope is that this new process will help bring to light, 
reduce, and eliminate some of the more unnecessary spending 
proposals approved by Congress.
    The principle that our tax dollars are too precious to be 
wasted is true even in times of surpluses and sustained 
economic growth. But the need to rein in wasteful spending 
takes on greater urgency in the face of the challenges we face 
today: the costs of wars in two theaters, growing costs of 
addressing domestic needs, and the threat of historically high 
deficit and debt levels. And while economists and politicians 
may disagree about the importance of reducing the deficit and 
the debt in times of high unemployment, no one advocates for 
the growth of deficit spending and increased borrowing to fund 
wasteful spending. Congress and the administration both need to 
take a hard look at the practices and options available to them 
to increase discipline in the spending arena. The Reduce 
Unnecessary Spending Act of 2010 would provide a tool for 
eliminating and curbing this wasteful spending, and we hope to 
see it enacted.
    Thank you.
    [The prepared statement of Ms. Alexander appears as a 
submission for the record.]
    Chairman Feingold. Thank you. I admire that you have 
devoted yourself to this issue, but it is not a big surprise 
because there is nowhere in Wisconsin where people like 
wasteful spending, but in Thiensville, they feel very, very 
strongly about that, as you well know.
    Ms. Alexander. I believe that. Yes.
    Chairman Feingold. Our final witness this morning is Alison 
Fraser, the director of the Thomas A. Roe Institute for 
Economic Policy Studies at the Heritage Foundation. Ms. Fraser 
oversees the Heritage Foundation's research on a range of 
domestic economic issues, including Federal spending, taxes, 
and long-term threats to our fiscal stability. Prior to joining 
Heritage, Ms. Fraser was the deputy director of the Oklahoma 
Office of State Finance and the budget manager for Orange 
County, California.
    Ms. Fraser, thank you for taking the time to testify today, 
and you may proceed.

 STATEMENT OF ALISON FRASER, DIRECTOR, THOMAS A. ROE INSTITUTE 
     FOR ECONOMIC POLICY STUDIES, THE HERITAGE FOUNDATION, 
                         WASHINGTON, DC

    Ms. Fraser. Thank you very much. It is a pleasure to be 
here today. The views I express are my own and not those of the 
Heritage Foundation. I am an economist and not a lawyer, and as 
such, it is my view that any additional tool to restrain 
Federal spending that meets constitutional muster should be 
available. This is all the more important today with trillion 
dollar deficits that are nearly 10 percent of GDP, while the 
national debt is on track to double over the next decade, 
reaching nearly 90 percent of the economy, and 100 percent of 
GDP is sort of an international benchmark for approaching 
crisis. So I am truly concerned about the fiscal path that we 
are on.
    Spending today is around 25 percent of GDP, and as you 
know, other than World War II, that has never happened. But 
unlike World War II, we really face a structural problem where 
spending will continue to track upwards as we move from 
recession-driven spending to entitlement-driven spending. And 
as we watch the fiscal contagion that started with Greece's 
budget crisis, spread across Europe and other countries, the 
concerns and attention to unsustainable Federal spending on our 
own shores have taken on crucial new urgency.
    So toward that end, though existing rescission authority 
has been used by Presidents regularly until George W. Bush, one 
of my concerns about this is that it has not had a really 
material effect on spending. For example, of the $43 trillion 
in Federal spending since 1990, Presidents have proposed 
rescinding around $20 billion, of which Congress has approved 
just $6 billion. So that is less than one one-hundredth of a 
percent of total Federal spending. To be sure, if President 
Bush had used this as other Presidents had, that number would 
have been a little bit higher, but not materially. And, of 
course, deterrence is something that is very, very difficult to 
measure, and that is certainly an important element to consider 
here.
    But this Congressional Accountability and Line Item Veto 
Act and the President's proposal would make important changes 
to the existing authority that Presidents have--we have heard 
that before; let me just run through them quickly--by requiring 
to act, that is, I think, the most important one, requiring it 
on fast track, and an up-or-down vote. All of those I think are 
really important improvements to the existing authority. And 
they get closer to what Governors had. I worked for a Governor 
for 8 years, and he really used the veto pen and his line-item 
veto authority. It is an important tool.
    This Act would focus on earmark spending, targeted tax 
benefits, and limited tariff benefits. These are all very 
important fiscal issues for Congress and the administration to 
focus on. However, my concern is that they do not add up to a 
lot of money. For example, the numbers I am going to use, there 
are about 9,500 earmarks in all 2010 appropriations bills worth 
around $16 billion. So even under this enhanced authority, if 
the President were to have proposed rescinding all of these 
earmarks, which is somewhat doubtful, discretionary spending, 
which is a small part of the budget, as we all know, would 
still have grown by 8 percent as opposed to 9 percent. And it 
is really hard to imagine a scenario where members would give 
up any, let alone all of their earmarks in a rescission package 
considering all of the negotiations, as you know, that go into 
appropriations bills in the first place. So my concern would 
like to have a much bigger effect.
    I think one of the improvements--and you mentioned this 
with earlier witnesses--is we could have more impact if more 
spending categories were included, so I would like to see more 
broadly discretionary spending and even new entitlement 
spending that would increase over the baseline included.
    To tackle the serious spending problems facing the Nation 
before they become a crisis, I really feel that stronger 
additional tools are necessary in addition to this legislative 
line-item veto. We heard no single bullet is going to solve the 
problem that we face, so let me quickly run through three 
additional tools that I would like Congress to consider.
    The first is easy. It is budget transparency, adding in the 
unfunded obligations from Social Security and Medicare, which 
total $43 trillion--a lot bigger than the current debt limit--
would provide transparency for lawmakers and the public to see 
what our real long-term fiscal future is. I think that major 
policy changes should be scored over the long term in addition 
to the 5- and 10-year budget windows so that we can measure 
what their effect would be on our long-term fiscal 
sustainability.
    And, finally, entitlements are not budgeted. They have no 
appropriations, and these three, the big three, are not even 
reauthorized on a regular basis like, say, the farm bill is. So 
I think this spending should be taken off of autopilot and put 
onto long-term, say 30-year budgets that are regularly re-
evaluated and put entitlement and mandatory spending on an even 
playing field so that all priorities are debated on a regular 
basis, not just the smaller window of discretionary spending.
    So, in short, I think that this is a useful tool. There are 
many more things that are going to be needed, and I welcome 
your comments, and thank you very much for the opportunity to 
talk to you today.
    [The prepared statement of Ms. Fraser appears as a 
submission for the record.]
    Chairman Feingold. Ms. Fraser, thank you for your 
testimony. I certainly do not dispute that additional things 
need to be done. Of course, this is a hearing of the Senate 
Judiciary Constitution Subcommittee, and we are particularly 
addressing the issue that the previous line-item veto--which I 
did vote for--was struck down by the Supreme Court. But I am 
also a member of the Budget Committee, and I will take to heart 
your additional ideas.
    Ms. Fraser. Thank you.
    Chairman Feingold. Thank you for your testimony.
    Mr. Cooper, thank you for your very thorough written 
testimony and particularly for your summary of the history of 
the 1996 law and its journey through the courts. Understanding 
that background is very helpful to the analysis of the 
constitutionality of the current proposals, and many who are 
watching or will watch this hearing are not lawyers or legal 
scholars, let alone constitutional scholars. But they probably 
remember that the line-item veto that Congress passed in 1996 
was struck down by the Supreme Court. I think you have done a 
very good job explaining why you think both the President's 
proposal and the bill that Congressman Ryan and I have 
introduced are constitutional.
    Let me ask you, in addition, do you see any constitutional 
risk in explicitly requiring that any savings realized by this 
proposed new rescissions process be used only for deficit 
reduction? We might do that, for example, by requiring that the 
annual budget caps be adjusted down to reflect the reduced 
spending. Do you see any constitutional infirmity in that?
    Mr. Cooper. I do not, Mr. Chairman. I will confess to you 
that I have not spent a lot of focused and concentrated thought 
and research on that particular question. But I do not see----
    Chairman Feingold. On the face of it, you do not----
    Mr. Cooper [continuing]. On the face of it any reason why 
Congress limiting itself in that fashion would pose a 
constitutional difficulty.
    Chairman Feingold. Thank you, sir.
    Ms. Alexander, let me turn to you. As I noted in my 
questioning of Mr. Liebman, the administration's bill does not 
include the same requirement that the rescissions be used to 
reduce the deficit. Would you support an effort to include such 
a requirement?
    Ms. Alexander. Yes, we would support--TCS has supported 
your proposal in the past, and we would support that as an 
amendment to the President's proposal.
    Chairman Feingold. Any other changes you would consider 
making to the President's proposal to cut back on Government 
waste?
    Ms. Alexander. I would say based on your questions, your 
back-and-forth with Mr. Liebman, I think we also agree that a 
faster timeframe would be helpful.
    Chairman Feingold. In terms of sessions days and----
    Ms. Alexander. In terms of session days, and while I am 
sensitive to the concern he raised of omnibus spending bills 
and the budget happening at the same time, it would also just 
be helpful to not just push all the omnibus CRs to the end of 
the year. So there are other solutions.
    Chairman Feingold. Very good.
    Ms. Fraser indicated--I agree with you--that the line-item 
veto is definitely not going to solve all of our budget 
problems, but I think it can be used to shine a light on 
wasteful programs or at a minimum to help dial down spending in 
accounts that have grown too large over time.
    Even if we did not broaden the President's proposal in the 
way you suggest by extending it to cover entitlement changes, 
as Senator Frist proposed a few years ago, do you think it is 
still worth trying?
    Ms. Fraser. I absolutely do. I think that, you know, we 
should have all constitutional framework adherent proposals, 
you know, at both the Congress' and the President's disposal. 
And I think that even though, you know, the bigger problem that 
we face is not discretionary spending and is not earmarks, 
these are very, very important things to do in the public eye, 
to show them that strong steps are being taken, you know, on 
sort of parallel tracks.
    Chairman Feingold. Thank you.
    Mr. Cooper, as you note in your testimony, the current 
proposal allows the President to temporarily defer or suspend 
implementation of a spending provision in order to give 
Congress time to consider a rescissions package, and I agree 
with you that such a deferral period does not violate the law 
or the Constitution. Can you just walk through a little bit 
what the constitutional limits of that temporary deferral 
authority might be?
    Mr. Cooper. Senator Feingold, it has been the practice of 
this body to delegate to the President the power to defer 
spending or even to decline to spend in so-called lump-sum 
appropriations really since the time of President Washington. 
And the lapsing of that appropriation authority has never been 
viewed as being in any way a constitutional problem. In fact, I 
think the Clinton case acknowledges that history and the 
constitutionality of that longstanding practice.
    For that reason, I do not believe that there would be a 
constitutional difficulty even if, for example, during the 
deferral period that the measures are before you would provide 
to the President extended beyond the appropriation 
authorization in the bill that the President was studying for 
purposes of exercising his power to recommend rescissions.
    So I do not see a constitutional difficulty. I think the 
issues there are more for this body in terms of the kinds of 
policy issues that it thinks are important in this area.
    Chairman Feingold. Thank you, sir.
    Ms. Alexander, finally, what do you think of Ms. Fraser's 
argument that a line-item veto will not solve all of our 
massive fiscal problems? Should we, nonetheless, support a 
proposal like this?
    Ms. Alexander. Certainly there is no silver bullet. I think 
that is a true statement. I think in the context of these 
proposals and focusing on earmarks, limited tax benefits, and 
tariffs, the bigger issue there that makes this very important, 
I think, is that there are special opportunities for 
corruption, and the public understands that those narrowly 
targeted benefits are what they do not like about how Congress 
spends money. And so focusing on things that have really 
undermined confidence in Congress and that while not every 
earmark is corrupt, not every special tax benefit is corrupt, 
they do present special opportunities for corruption, and we 
have seen that in the past. So I think addressing them is an 
important first step, although it certainly will not address 
the deficit on its own.
    Chairman Feingold. Thank you all for answering my 
questions.
    We are pleased to be joined by our colleague Senator 
Whitehouse. You may take a round of questions.
    Senator Whitehouse. Thank you, Chairman Feingold, and thank 
you for your work on this issue. I think it is a promising area 
and one certainly that merits our inquiry and exploration.
    Obviously, a proposition like this, if enacted, will create 
political effects in addition to economic effects, and I noted 
with considerable interest Senator Conrad's concern expressed 
in the newspaper, I think yesterday. He is a gentleman who has 
been around here a very long time who has an exemplary 
reputation, who is our Chairman on the Budget Committee, and he 
expressed the concern that this might lend itself to selective 
and abusive application by the executive branch, not with the 
intention to reduce spending and control waste, but to punish 
and reward legislators for their support of or opposition to 
various things. And I think it is a legitimate concern as to 
whether unintended consequences of the balance of power between 
executive and legislative could emerge from this.
    So I am particularly interested in probably the most boring 
section of all, which is Section 4, which, as I read it, 
sunsets this provision at the end of 2014. Do you all see it as 
a complete sunset at the end of 2014?
    Mr. Cooper. I am not sure I understand, Senator Whitehouse, 
what you mean by ``complete,'' but the provisions that I have 
read do seem to suggest that the Act itself will go away 
completely.
    Senator Whitehouse. It will go out of business in 2014.
    Mr. Cooper. Yes, sir.
    Senator Whitehouse. And would need to be readopted if we 
were going to continue it beyond then.
    Mr. Cooper. Exactly. The power that the President is 
authorized to exercise in connection with these bills would 
expire, and if he is ever to exercise it again, it will have to 
be on the say-so of this body in another bill of that kind.
    Senator Whitehouse. It strikes me that the sunset provision 
accomplishes two things: one, it enables us to have a trial 
period during which we cannot only evaluate the economic and 
waste-cutting effects of this provision, but also evaluate the 
extent to which it affects the balance of power between 
executive and legislative and does so in a helpful or unhelpful 
way; and the second is that because the executive branch could 
see the 2014 sunset and the need to renew it basically ab 
initio ahead of itself, I would think it would restrain the 
worst behavior that the bill might otherwise permit for fear 
that if you blow it now, you blow it forever, because if you 
abuse this, Congress will never give you back this authority 
again.
    And it strikes me that both as a trial period and as a 
potential deterrent against the worst political abuses of this 
provision, Section 4 is a pretty important piece of this 
legislation and a good element when we are stepping out into 
something new like this. And I would like to hear your 
reactions to those two thoughts about Section 4. Ms. Alexander.
    Ms. Alexander. We do not object to the sunsetting. I think 
there is some merit to the argument that there is a trial 
period, and this is a rearrangement of the dance between any 
administration and Congress, particularly on spending. We think 
there is room for that relationship to change because it is not 
working to the best interests of the taxpayers right now.
    I think, you know, unintended consequences are notoriously 
hard to predict, whether or not----
    Senator Whitehouse. By definition.
    Ms. Alexander. Right. The political consequences of a 
President abusing this authority. Part of the strength of these 
proposals is that they shed light on specific provisions, and 
if by highlighting those specific provisions it is easy for a 
Member of Congress or any special interest to say they have 
been singled out, I am quite confident that people would do 
that. You know, sunlight goes both ways, so whoever feels like 
they might be the victim of being singled out would have a 
platform and have their interest highlighted. I think, you 
know, nobody runs for office without knowing what business they 
are getting into. And might these be political? Yes. Is that 
necessarily going to be popular with the public? Maybe not. And 
that may be the reason not to do it for the President and the 
reason for Congress to be deterred from including particularly 
egregious spending items.
    Senator Whitehouse. Ms. Fraser, what do you think about----
    Ms. Fraser. Yes, I think you raise an excellent point, and 
there is certainly a lot of unintended consequences to be 
concerned about. One of the things that could happen is, in 
fact, this tool for the President could actually see spending 
go up. And I think that is something that none of us on this 
panel would like to see. So it could be that the sunset 
provision could be an important sort of check and balance in 
this new authority itself. And as I spoke about earlier, I do 
think that that is one of the reasons that you need to combine, 
you know, a tool like this with other strong spending 
limitation kinds of tools.
    Senator Whitehouse. Mr. Cooper, final thoughts? I did not 
hear from you on this, and we have about 48 seconds.
    Mr. Cooper. Well, Senator Whitehouse, I do not have any 
thoughts with respect to the constitutional dimension of your 
question because I just do not think there is a constitutional 
issue raised by this----
    Senator Whitehouse. My question did not have a 
constitutional dimension. It just had a practical political 
dimension that----
    Mr. Cooper. Yes. Well, the only thing I think I would add--
and I think your points are well taken. Certainly the concerns 
you voiced and that other Senators have, even Senator Byrd back 
during the days when I represented him in connection with the 
challenge to the earlier Line Item Veto Act, this was one of 
his major concerns. But there are other potential unintended 
consequences of the sunset, and that is that, to whatever 
extent the President aggressively uses in the way that this 
body and its intendment would expect, that too could lead to 
Members of the Senate or Members of the House not being 
particularly fond of the idea of reenacting it, because, let us 
face it, the practice of earmarks is one that is a very 
difficult one to eliminate or to control. And to the extent 
this measure becomes effective in that, it may create the 
unintended consequence of something that produced the very good 
that this seeks to produce would provide the impulse to let it 
sunset.
    So I guess there is another side to that coin----
    Senator Whitehouse. It might deter the deterrence.
    Mr. Cooper. There may be another side of that coin, but I 
do think the points that you have made are very well taken.
    Senator Whitehouse. Thank you.
    Thank you for the time, Chairman Feingold, and thank you 
for drawing attention to this.
    Chairman Feingold. Senator Whitehouse, thank you for your 
thoughtful involvement in this. I look forward to working with 
you on this issue.
    I want to thank all of our witnesses today. I again want to 
thank the Ranking Member, Senator Coburn. Even though his 
schedule did not permit him to take part in the hearing, he and 
his staff extended every courtesy to us in putting this hearing 
together, and we thank them for that.
    Given the budget challenges facing our country, the line-
item veto could not be a more timely issue, and the President's 
line-item veto proposal is a welcome addition to the measure 
several of us have already proposed.
    President Obama inherited the worst economic mess ever left 
a new President in our Nation's history, and the crushing 
recession, which he also inherited, has made it only worse. So 
we have to get our fiscal house in order. I do not think there 
is anyone here who would disagree with that.
    I realize that an expedited rescissions or line-item veto 
bill will not solve all of our budget problems. But if it is 
structured properly, a line-item veto measure can help us 
reduce wasteful spending and shine a light on unnecessary 
projects that benefit a few groups at great cost to the rest of 
the nation. We need to take a step toward addressing our 
serious fiscal challenges, and I think the administration's 
proposal will set us on the right track to reducing spending 
and improving government accountability.
    I will be introducing the President's proposal in 
legislative form shortly with Senator Carper, and I will be 
pushing to have the Senate pass it this year.
    Thanks for all your time, and the hearing is adjourned.
    [Whereupon, at 11:14 a.m., the Subcommittee was adjourned.]
    [Submissions for the record follow.]
    
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