[House Hearing, 117 Congress]
[From the U.S. Government Publishing Office]
PROTECTING OUR DEMOCRACY:
REASSERTING CONGRESS' POWER OF THE PURSE
=======================================================================
HEARING
BEFORE THE
COMMITTEE ON THE BUDGET
HOUSE OF REPRESENTATIVES
ONE HUNDRED SEVENTEENTH CONGRESS
FIRST SESSION
__________
HEARING HELD IN WASHINGTON, D.C., APRIL 29, 2021
__________
Serial No. 117-2
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Printed for the use of the Committee on the Budget
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Available on the Internet:
www.govinfo.gov
___________
U.S. GOVERNMENT PUBLISHING OFFICE
44-771 WASHINGTON : 2021
COMMITTEE ON THE BUDGET
JOHN A. YARMUTH, Kentucky, Chairman
HAKEEM S. JEFFRIES, New York JASON SMITH, Missouri,
BRIAN HIGGINS, New York Ranking Member
BRENDAN F. BOYLE, Pennsylvania, TRENT KELLY, Mississippi
Vice Chairman TOM McCLINTOCK, California
LLOYD DOGGETT, Texas GLENN GROTHMAN, Wisconsin
DAVID E. PRICE, North Carolina LLOYD SMUCKER, Pennsylvania
JANICE D. SCHAKOWSKY, Illinois CHRIS JACOBS, New York
DANIEL T. KILDEE, Michigan MICHAEL BURGESS, Texas
JOSEPH D. MORELLE, New York BUDDY CARTER, Georgia
STEVEN HORSFORD, Nevada BEN CLINE, Virginia
BARBARA LEE, California LAUREN BOEBERT, Colorado
JUDY CHU, California BYRON DONALDS, Florida
STACEY E. PLASKETT, Virgin Islands RANDY FEENSTRA, Iowa
JENNIFER WEXTON, Virginia BOB GOOD, Virginia
ROBERT C. ``BOBBY'' SCOTT, Virginia ASHLEY HINSON, Iowa
SHEILA JACKSON LEE, Texas JAY OBERNOLTE, California
JIM COOPER, Tennessee
ALBIO SIRES, New Jersey
SCOTT H. PETERS, California
SETH MOULTON, Massachusetts
PRAMILA JAYAPAL, Washington
Professional Staff
Ellen Balis, Staff Director
Mark Roman, Minority Staff Director
CONTENTS
Page
Hearing held in Washington, D.C., April 29, 2021................. 1
Hon. John A. Yarmuth, Chairman, Committee on the Budget...... 1
Prepared statement of.................................... 4
Letter submitted for the record.......................... 6
Hon. Jason Smith, Ranking Member, Committee on the Budget.... 8
Prepared statement of.................................... 10
Letters submitted for the record......................... 89
Molly E. Reynolds, Senior Fellow, Governance Studies, The
Brookings Institution...................................... 14
Prepared statement of.................................... 17
Liz Hempowicz, Director of Public Policy, Project On
Government Oversight....................................... 22
Prepared statement of.................................... 24
Edda Emmanuelli Perez, Deputy General Counsel, U.S.
Government Accountability Office........................... 32
Prepared statement of.................................... 70
Mark R. Paoletta, Senior Fellow, Center for Renewing America. 32
Prepared statement of.................................... 35
Letters submitted for the record......................... 43
Hon. Ashley Hinson submitted a letter for the record......... 118
Hon. Sheila Jackson Lee, Member, Committee on the Budget,
statement submitted for the record......................... 131
Questions submitted for the record........................... 138
Answers submitted for the record............................. 142
PROTECTING OUR DEMOCRACY:
REASSERTING CONGRESS'
POWER OF THE PURSE
----------
THURSDAY, APRIL 29, 2021
House of Representatives
Committee on the Budget
Washington, D.C.
The Committee met, pursuant to notice, at 1 p.m., via Zoom,
Hon. John A. Yarmuth [Chairman of the Committee] presiding.
Present: Representatives Yarmuth, Boyle, Price, Schakowsky,
Kildee, Chu, Plaskett, Wexton, Scott, Jackson Lee, Sires;
Smith, McClintock, Grothman, Smucker, Burgess, Carter, Cline,
Feenstra, Good, and Hinson.
Chairman Yarmuth. The hearing will come to order. We are
holding this proceeding virtually in compliance with the
regulations for committee proceedings pursuant to House
Resolution 965 carried over to the 117th Congress via House
Resolution 8. I would like to remind Members that we have
established an email inbox for submitting documents before and
during committee proceedings and we have distributed that email
address to your staff.
Consistent with regulations, the Chair or staff designated
by the Chair may mute participants' microphones when they are
not under recognition for the purpose of eliminating
inadvertent background noise. Members are responsible for
unmuting themselves when they seek recognition. We are not
permitted to unmute Members unless they explicitly request
assistance. If I notice that you have not unmuted yourself, I
will ask you if you would like staff to unmute you. If you
indicate approval by nodding, staff will unmute your
microphone. They will not unmute your microphone under any
other conditions.
Members must have their cameras on and be visible on screen
in order to be recognized. Members may not participate in more
than one committee proceeding simultaneously. I do not know if
we have any Members in the hearing room. But if we do, in light
of the attending physician's new guidance and his announcement
on January 4th, any Members present in the hearing room must
wear a mask at all times and are required to keep their masks
on when seeking recognition and speaking.
For those Members not wanting to wear a mask, the House
rules provide a way to participate remotely from your office
without being physically present in the hearing room.
And now I will say what I should have said at the
beginning. Good afternoon and welcome to the Budget Committee's
hearing on Protecting our Democracy: Reasserting Congress'
Power of the Purse. I want to introduce our witnesses for
today. This afternoon, we will be hearing from Dr. Molly
Reynolds, Senior Fellow in Governance Studies at the Brookings
Institution, Liz Hempowicz, Director of Public Policy at the
Project on Government Oversight, Edda Emmanuelli Perez, Deputy
General Counsel at the U.S. Government Accountability Office,
and Mark R. Paoletta, Senior Fellow at the Center for Renewing
America.
I will now yield myself five minutes for an opening
statement.
Exactly one year ago yesterday, I introduced the
congressional Power of the Purse Act. I said it was an
important step in restoring Congress' constitutional spending
authority and reinforcing the foundations of our democracy, a
responsibility that should be embraced by both sides of the
aisle. Today we are in a new Congress, with a new
Administration that has taken steps to return to previous
longstanding norms. We have a reinvigorated OMB led by an
Acting Director with firsthand experience fighting to protect
Congress' spending authority. And we are using this Committee's
first full hearing to again examine the importance of
safeguarding Congress' constitutional authority and the need
for the congressional Power of the Purse Act. I believe in this
good government reform legislation, and I am fully committed to
pursuing its reforms regardless of who is in the White House.
Our founders knew that money, and who controls it, is
fundamental to a democratic government. They also knew that,
with elections every two years, Congress would be the branch
most accountable to the public. So, they gave us the power of
the purse as a critical check on the President.
Congress has exercised this power by enacting foundational
laws, like the Antideficiency Act and the Impoundment Control
Act, and updating them as challenges to its authority arose. To
help protect and enforce its spending decisions, Congress
established the non-partisan Government Accountability Office,
which, as we all know, is charged with investigating and
reporting on violations of budget and appropriations laws.
However, Congress' ability to exercise its singular
constitutional authority has become increasingly challenged by
an executive branch that has sought to seize control of the
nation's purse for itself. Presidents and agencies of both
parties have pushed the boundaries of their delegated spending
powers, exploiting secrecy, a lack of reporting requirements,
and limitations on enforcement to push their own agenda and
sidestep Congress. Decades of this purposeful infringement on
Congress' power of the purse proves that Congress cannot rely
on interbranch comity and nonbinding norms in the face of an
emboldened executive branch.
For our government to work, the American people need to
know that when their representatives in Congress pass a funding
bill and it is signed into law, the executive branch will
follow the law to ensure their hard-earned tax dollars go where
their representatives intended. For Congress to remain a co-
equal branch of government and live up to our constitutional
charge, we must reassert Congress' control over spending and
ensure we are the ones holding the purse strings. That is why I
introduced the congressional Power of the Purse Act.
My legislation increases transparency by requiring the
executive branch to make apportionments, along with legal
justifications and opinions, publicly available. This helps to
prevent arbitrary and self-serving decisionmaking, promote
legal compliance, and end the use of expansive legal
interpretations to exert undue influence on spending decisions.
By making apportionments public, Congress and the American
people can see exactly how federal resources are being used.
The bill also increases accountability by improving and
expanding controls under the Antideficiency Act and the
Impoundment Control Act. It strengthens and expedites GAO's
ability to obtain information from agencies and requires the
executive branch to report to Congress on all violations of the
ADA and ICA identified by GAO, a requirement that is
unbelievably absent from current law. My bill also authorizes
administrative discipline for government employees responsible
for violating the law, serving not only as an important
deterrent, but also as a tool to empower government employees
to push back on political pressure to break the law.
Transparency, accountability, checks and balances--these
tenets are at the core of our constitutional republic and a key
component of our responsibility as Members of Congress.
A commitment to good government cannot ebb and flow
depending on who controls the levers of power. Our Committee
has issued reports, held hearings, written to officials in both
the Trump and Biden Administrations, and introduced legislation
as part of our work to safeguard Congress' spending authority.
We continue this important work with our hearing today.
Today presents another opportunity to examine our current
framework of fiscal laws, its potential shortfalls, and why
Congress must take legislative action to safeguard its
constitutional authority, including passing the congressional
Power of the Purse Act.
We have assembled an expert panel of witnesses to help us,
and I look forward to this important discussion.
And before I recognize the Ranking Member, I ask unanimous
consent to enter into the record a letter the Power of the
Purse Coalition sent to me and to the Ranking Member applauding
the Committee's leadership on this ``bipartisan, bicameral
issue that impacts accountability and integrity within our
governmental system'' and enthusiastically supporting reforms
in the congressional Power of the Purse Act and its advancement
in the 117th Congress.
The Power of the Purse Coalition represents organizations
across the ideological spectrum, and this letter of support is
signed by Demand Progress, FreedomWorks, the National
Taxpayers' Union, Project On Government Oversight, Protect
Democracy, R Street Institute, and Taxpayers for Common Sense.
I thank these organizations for their strong support and
without objection, the submission will be in the record. So
ordered.
[The prepared statement of Chairman Yarmuth and letter
submitted for the record follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Chairman Yarmuth. With that, I would like to yield to the
Ranking Member Mr. Smith for five minutes for his opening
statement.
Mr. Smith. Mr. Chairman, thank you for convening this
hearing. It could not be more relevant given the current State
of Congress' performance on budgeting and spending. It also
could not be more necessary given the actions of President
Biden when it comes to the crisis on our southern border. And
specifically, his decision to abandon construction of the
border wall after Congress appropriated funding for it. The
President's decision to withhold funding on the border wall,
along with other actions his Administration has taken, have
only fueled a national security and humanitarian crisis at the
southern border.
As the Chairman is aware, Republicans on this Committee
have called for a hearing on what we view as an unlawful
withholding of funding, especially given this Committee's
stated oversight responsibilities. I appreciate that the
Chairman has chosen this Committee's first hearing to focus on
issues that are related to President Biden's decision to freeze
funding for the border wall. This is an opportunity to exercise
much needed oversight.
Given the Chairman's previous concerns with the actions of
President Trump on spending appropriated funds, I look forward
to his comments on President Biden's decision to withhold
funding, since I would assume there would be a similar concern
no matter who sits in the oval office. I also look forward to
hearing from our GAO witness about what that agency is doing as
it relates to President Biden's withholding of funding.
Members from both the House and Senate have called on GAO
to investigate this matter. Frankly, it is very concerning that
such a request was needed given GAO's very public interest in
this issue area. One has to wonder why GAO was not on the case
the day after President Biden abandoned construction of the
wall.
I respect the fact that the Chairman will want to discuss
the broader issue with Congress. Congress' Article I
authorities and the power of the purse. I welcome that
discussion. Part of it should center around Congress, their own
shortcomings in this matter, and its inability to follow or
enforce its own rules, roles, and responsibilities. When it
comes to budgeting and spending taxpayer dollars, just look at
the historic record. Since 1977, there have been 20 government
shutdowns and Congress has had to enact 192 continued
resolutions, including four this Fiscal Year because deadlines
for completing regular appropriation bills have not been met.
Congress has failed to follow regular order, that is
passage of a budget resolution followed by 12 separate
appropriation bills before the beginning of the fiscal year,
every year since Fiscal Year 1995.
According to the Congressional Budget Office, 1,046
authorizations from 272 laws expired prior to the start of
Fiscal Year 2020. And appropriations for the Fiscal Year 2020
included $332 billion attributable to expired authorizations.
As of right now, work on funding for the upcoming fiscal year,
Fiscal Year 2022, is not currently on track to look much
different. Given delays in the budget process on the part of
Congress and the President, there is the growing likelihood
Congress starts the Fiscal Year with another CR or massive
omnibus spending bill.
In closing, we are holding this hearing on the 100th day
the Biden Presidency. A hundred days in which not only did the
President withhold appropriated funds while fueling a crisis at
our southern border, he also fired thousands of Americans by
the stroke of a pen and has proposed or pursued policies that
will destroy jobs, drive down wages, and drive up the cost of
living for America's working class. I hope this Committee
would, at the very least, continue to seek answers from the
Administration on how it plans to budget for all the policies
its proposed.
Thank you, Mr. Chairman, and I look forward to the
testimony from today's witnesses. Mr. Chairman, you are muted.
[The prepared statement of Jason Smith follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Chairman Yarmuth. Thank you. Thanks to the Ranking Member.
I apologize for that. But thank you for your opening statement.
In the interest of time, I ask that any other Members who wish
to make a statement, submit their written statements for the
record to the email inbox we established for receiving
documents before and after--before and during the committee
proceedings. We distributed that email address to your staff. I
will hold the record open until the end of the day to
accommodate those Members who may not yet have prepared written
statements.
I would like to thank our witnesses for being here this
afternoon. The Committee has received your written statements
and they will be part of the formal hearing record. You will
each have five minutes to give your oral remarks. As a
reminder, please unmute your microphone before speaking. Dr.
Reynolds, please unmute your microphone and begin when you are
ready.
STATEMENTS OF MOLLY E. REYNOLDS, SENIOR FELLOW, GOVERNANCE
STUDIES, THE BROOKINGS INSTITUTION; LIZ HEMPOWICZ, DIRECTOR OF
PUBLIC POLICY, PROJECT ON GOVERNMENT OVERSIGHT; EDDA EMMANUELLI
PEREZ, DEPUTY GENERAL COUNSEL, U.S. GOVERNMENT ACCOUNTABILITY
OFFICE; MARK R. PAOLETTA, SENIOR FELLOW, CENTER FOR RENEWING
AMERICA
STATEMENT OF MOLLY E. REYNOLDS
Dr. Reynolds. Thank you, Chairman Yarmuth, Ranking Member
Smith, and Members of the Committee. My name is Molly Reynolds,
and I am a Senior Fellow in the Governance Studies Program at
the Brookings Institution. I appreciate the opportunity to
testify today on how Congress can better fulfill its
constitutional obligation to provide for and effectively
oversee the executive branch.
In this context, I want to make four points. First, because
the Constitution separates the legislative and executive
functions, divergence between Congress' intent and policy
outcomes is inevitable. Congress must design and periodically
redesign mechanisms to monitor executive branch implementation
of policy. It is not possible, nor is it wise for Congress to
try to write every policy detail into law. The executive branch
has types of expertise that make it better equipped to make
certain detailed decisions. As the policy problems facing the
nation have become more complex, Congress has increasingly
found itself incapable of writing statutes that contain all
these specific choices.
In addition, Congress often prefers to leave detailed
decisions to the executive branch because they are politically
challenging. Together, these circumstances mean that Congress
must design ways to monitor this inevitable potential for
slippage. Divergence can and does occur regardless of whether
the branches are controlled by the same political party. Even
in an era of high partisan polarization, the need for
monitoring and oversight tools is structural and fundamental to
the constitutional system.
Second, because divergence between Congress' intent and the
executive branch's implementation is inevitable, so too is the
need for Congress to periodically revise its procedures as it
has done in the past. The Antideficiency Act's apportionment
requirement was enacted to prevent the executive branch from
quickly spending down its allocations and demanding more funds.
The Congressional Budget and Impoundment Control Act contain
several provisions expressly responding to aggressive
assertions of power by the executive branch. Several components
of the Power of the Purse Act are natural successors to these
earlier budgetary provisions. Importantly, the Presidential
powers targeted by these provisions are statutory. If Congress
wrote the statute originally, it too should update it
periodically in response to changing conditions.
The President is not the only actor whose changing behavior
can require a response from Congress. Prior to the Supreme
Court's decision in INS v. Chadha, legislative veto provisions
were an important tool in Congress' arsenal. Because
legislative veto provisions often included procedures that
expedited consideration of the review legislation, they
demonstrate a powerful choice by some individual Members of
Congress: cede some of their individual power in order to give
the institution a stronger voice. The Supreme Court's decision
in Chadha disrupted that bargain and Congress would be well-
served to adapt its procedures in response as Title III of the
Power of the Purse Act does for the National Emergencies Act.
Third, the evolution of Congress' own approach to
processing spending bills has also increased the need for new
tools to enhance oversight capacity. Relying on continuing
resolutions and large omnibus bills breeds brinkmanship because
the cost to Congress and its constituents of letting the
government shut down is so high, legislators cannot credibly
threaten to withhold funding from a specific priority or
activity because the president has chosen to stray from
congressional intent. When there is a partial shutdown of
federal operations, the executive branch has substantial
discretion over exactly which activities cease and which ones
can continue. This discretion further undermines Congress'
power in shutdown confrontations.
A common reaction to this brinkmanship is to call for a
return to so-called regular order. But little in Congress'
recent experience suggests that is likely. Given this, Congress
must turn to new tools like those in the Power of the Purse Act
to ensure it gets the information it needs.
Finally, changes in the nature of congressional oversight
also mean that reforms to support Congress' work are needed.
Historically, Congress' efforts to oversee the executive branch
generally followed a model of accommodation. This
accommodations process has eroded and Congress has had more
difficulty enforcing subpoenas against the executive branch.
Given this, Congress would be well served to strengthen its
hand as it seeks information from the executive branch. Several
provisions in the Power of the Purse Act aim to do this. The
slow speed at which the federal courts move, however,
constrains Congress' ability to use them effectively as the
mechanism to ensure executive compliance, even in instances
where the courts are likely to side with Congress.
The legislative branch must work on its own behalf, just as
previous Congresses have done as part of the continual push and
pull between the branches.
While other periods of heavy congressional delegations to
the executive, like the 1930's and 1960's, were followed by
enhancements by Congress of its own capacity to oversee those
actions in the 1940's and 1970's, the expansion of executive
power that began after September 11th has not been met with a
similar assertion of congressional authority. The Power of the
Purse Act represents an important part of that necessary
effort.
Thank you, again, for the opportunity to testify today, and
I look forward to your questions.
[The prepared statement of Molly E. Reynolds follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Chairman Yarmuth. Thank you very much, Dr. Reynolds. I now
recognize Ms. Hempowicz for five minutes. Unmute and you have
the floor.
STATEMENT OF LIZ HEMPOWICZ
Ms. Hempowicz. Thank you. Chairman Yarmuth, Ranking Member
Smith, and Members of the Committee, thank you for inviting me
to testify today about Congress' power of the purse and efforts
to reclaim and reassert that power.
One reading of the Constitution's focus and prioritization
on the legislative branch is that the founders intended it to
be the most powerful actor within the three branches of
government. However, today we have an executive branch that has
encroached on significant authorities that the Constitution
explicitly vested in the legislative branch, including the
power of the purse. Because of this encroachment, the executive
branch now wields a disproportionate amount of power in our
three-branch structure.
A rebalancing of that power is long overdue, particularly
in light of growing public concern about government corruption.
I am here today to ask you to improve your ability to oversee
how the executive branch spends the public money that Congress
appropriates. More specifically, I urge you to require more
transparency from the White House's Office of Management and
Budget about how it apportions or schedules how executive
agencies spend appropriated funds.
Now that you know what I am here to ask you to do, I will
explain why. Congress has mandated that the executive branch
set a schedule to disburse money that has been appropriated to
agencies as an attempt to encourage responsible financial
management. This is meant to prevent both overspending and
programmatic disruptions. This process of scheduling out
funding is called apportionment. I want to emphasize that this
is not an inherent executive branch power. It is one that
Congress created and it is well within congressional authority
to dictate limits to how the executive exercises this function.
Today, the Office of Management and Budget exercises
apportionment authority on behalf of the President. While they
may delay the disbursal of funds for legitimate programmatic or
technical reasons, the executive is not authorized to delay or
withhold funds to achieve policy objectives. This is quite
simply because allowing OMB or the President to withhold or
delay funds to achieve policy objectives would be tantamount to
handing the power of the purse over to the executive branch
entirely.
Because there are clear constitutional limits to the
apportionment process, transparency is critical to ensure that
the executive is not abusing it. Which is why the public may be
surprised to hear that these apportionment directives are
issued entirely in secret. OMB issues apportionment directives
both by fiscal quarter and by project or a combination of those
two. So, though they are subject to public records requests
through the Freedom of Information Act, it is difficult to
ensure consistent transparency without proactive release of
this information.
That means that lawmakers don't have regular access to the
text of apportionment directives or the footnotes, which
contain more specific directions from the White House related
to the funding and can be used as a way to compel or
incentivize agencies to take certain actions. Not only does
this make it harder for Congress to conduct oversight, but the
lack of transparency makes it difficult for the public to have
faith that taxpayer resources are being handled with integrity
and in a manner consistent with the intent of Congress.
The executive branch has a long history of expansively
interpreting the authorities granted to it by Congress, well
beyond what the statutory text would dictate. Those legal
interpretations often issued by the Office of Legal Counsel at
the Department of Justice are also issued in secret and they
have serious ramifications on the balance of power when it
comes to matters related to the power of the purse.
The President's obligation to take care that the laws and
spending decisions enacted by Congress are executed as Congress
intended demand additional transparency in both areas. Taking
it back to our founding, Congress holds the power of the purse
because the founders envisioned it would be the branch of
government most accountable to the people, and, therefore, best
able to wield that power in a way that is responsive to the
needs and interests of the public.
It also reflects that the founders were very concerned that
vesting too much authority, particularly to spend public money,
in an executive branch led by a single person. Remember, the
Constitution only gives the executive a handful of independent
authorities. None of which require secrecy around how the
executive branch apportions funds.
The potential for the executive branch to manipulate
spending in secret exposes our government to corruption and
undermines the delicate balance of power between our branches
of government. Additional transparency around these budgetary
decisions will only improve Congress' capacity to oversee
executive branch spending, serving as a check against
malfeasance and corruption.
For example, Ranking Member Smith, if the congressional
Power of the Purse Act was law, you and Congressman Katko would
already have many of the answers to the questions you have
recently asked the Biden Administration about how appropriated
funds are being used at the southern border. That is because
you would have--you would likely have timely access to the
documents dictating that spending.
I urge this Committee to pass the congressional Power of
the Purse Act, either on its own or as part of the sweeping
anticorruption package introduced last Congress aptly titled
the Protecting Our Democracy Act. Thank you, again, for holding
this important hearing, and I look forward to answering your
questions.
[The prepared statement of Liz Hempowicz follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Chairman Yarmuth. Thank you very much for your testimony. I
now recognize Ms. Emmanuelli Perez for five minutes. Please
unmute and we are interested in your testimony.
STATEMENT OF EDDA EMMANUELLI PEREZ
Ms. Emmanuelli Perez. Chairman Yarmuth, Ranking Member
Smith, and Members of the Committee, thank you for the
opportunity to discuss Congress' constitutional power of the
purse, the Government Accountability Office's role in serving
this power, and several legislative proposals to strengthen
this power.
Since our creation a century ago, GAO has performed audits
and investigations and issued legal decisions to support
Congress in its oversight of executive spending. Congress has
also vested GAO with additional statutory responsibilities
[inaudible]----
Chairman Yarmuth. If you can suspend for a minute, please?
Your sound is breaking up.
[Audio malfunction]
Chairman Yarmuth. Yes. Sam, why don't we see if we can get
her sound corrected, and in the meantime, we will hear from Mr.
Paoletta. So, Mr. Paoletta, you are recognized for five
minutes. Please unmute and give us your testimony.
STATEMENT OF MARK R. PAOLETTA
Mr. Paoletta. Chairman Yarmuth, Ranking Member Smith, and
Members of the Committee, thank you for the invitation to
testify today on legislation to amend the Impoundment Control
Act. This bill has been described as an effort to strengthen
Congress' power of the purse and to prevent impoundments.
It is ironic that as this bill is being considered,
President Biden is holding, that is impounding, funds for the
construction of a wall along the southern border, including
$1.4 billion specifically appropriated for the border wall
construction. Based on GAO's opinion on funding for Ukraine,
President Biden's hold is clearly illegal and a violation of
the Impoundment Control Act. But the Democrats on this
Committee have been silent on this direct assault on Congress'
power of the purse.
President Biden's hold is 100 days and counting. It is an
ongoing hold, which is twice as long as the Trump OMB 50-day
hold on Ukraine funds. President Biden's decision to impound
these border wall funds, combined with his reversal of other
Trump Administration policies on immigration and border
security, has led to catastrophic consequences and a true
crisis of human suffering at the border. These policies have
tragically facilitated increased human trafficking and other
horrible situations. And this was all avoidable given the good
work done by President Trump and his Administration to address
these issues at the border.
Even after the Trump OMB released the funds for Ukraine
after 50 days, Chairman Yarmuth and Chairwoman Lowey stated
that OMB's unilaterally delaying the funding was an abuse--this
is a quote--``an abuse of authority provided to the President
to apportion appropriations,'' and sent sweeping document
requests to OMB.
Why hasn't the Chairman or any Democrat on this Committee
issued any statements or sent document requests to DHS or OMB
asking about this ongoing hold? If you truly cared about
preventing impoundments or asserting Congress' power of the
purse, your actions would not be governed by who is president
or whether you agree with the policy.
GAO rejected the Trump OMB's argument that the President
could hold funds to figure out how best to spend the funds
consistent with the appropriations and the President's agenda.
In contrast to that Trump hold, President Biden's hold is
designed to specifically thwart a lawfully enacted
congressional appropriations to build the border wall.
President Biden pledged during the campaign not to build
another foot of the wall, calling it a waste of money. His
Fiscal Year 2022 discretionary request proposes to rescind the
very border wall money that he is holding. Thus, the Biden
Administration is apparently now intentionally under-executing
congressionally appropriated funding in order to later rescind
it. That is a flat-out defiance of congressional intent and is
a textbook impoundment.
GAO's Ukraine opinion stated, the ICA does not permit
deferrals for policy reasons. Faithful execution of the laws
does not permit the President to substitute his own policy
priorities for those that Congress has enacted.
This bill will only make a bad law worse. The ICA has
undermined responsible stewardship of government spending. Why?
Because the ICA disincentivizes any effort to run programs more
effectively to achieve savings by mandating onerous procedures
to make it all but impossible to save unnecessary funds.
It used to be well-established policy to faithfully
implement programs with the least amount of money necessary.
The ICA now makes those efforts potentially illegal. The ICA
overthrew 200 years of how the executive and legislative
branches worked together. Congress should use its powers under
Article I of the Constitution to focus on passing detailed
authorizing laws, reauthorizing the hundreds of laws that have
expired, and enacting separate appropriations bills on time and
not in a monstrous omnibus passed months late.
Well-crafted laws authorizing federal programs are
critically important to ensuring that the executive can
effectively fulfill congressional intent. The appropriations
should be a means to implementing that federal program, not an
end in itself.
The bill's provisions are all meant to increase the
micromanaging of the daily operations of the executive branch.
And they will further undermine effective stewardship of
government spending. For example, the provision that requires
funds to be made available for obligation within 90 days of the
end of the period of availability is wrongheaded. By shortening
the timeline by when an appropriation must be apportioned, and
particularly given Congress' inability to pass things on time,
this bill will only further undermine Presidential
decisionmaking and exacerbate wasteful spending.
A provision regarding publicly listing the positions that
have apportioning authority will ultimately result in the
doxing of federal civil servants. A provision regarding
applying administrative penalties to executive branch officials
found to have impounded funds is bad policy because there are
so many gray areas as to what constitutes a violation of the
ICA. It is worth noting--this is interesting--that Members of
Congress and their staff routinely call agency staff to demand
that they hold apportioned funds, often without any purpose
related to the implementation of that program.
During the Trump Administration, I provided GAO with 300
examples from the State Department in a 3-year period where
Members of Congress demanded holds on funding. They ranged from
somewhere from 10 days to 321 days. Are these impoundments for
which an agency employee would be held responsible?
The provisions giving GAO additional powers to make demands
on the executive branch are unwise and probably
unconstitutional. For example, the law empowered the GAO to
demand documents from the President of the United States, and
if he does not comply in 20 days, GAO is empowered to sue him
in federal court to make him comply. That is astonishing.
Congress can't even do that, and GAO works for Congress.
There are other concerns with this bill, but in the
interest of time, I will leave it at that. My full statement
with two attachments, have been submitted for the record, and I
am happy to answer any questions. Thank you.
[The prepared statement of Mark R. Paoletta and letters
submitted for the record follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Chairman Yarmuth. Thank you for your testimony. Since my
name was invoked and by inclusion of the Members of the
Committee, I do want to respond to the issue of what we have
done with regard to the border wall funding. Within days of the
announcement of the Administration that they were not going to
fund, we were in contact with the OMB. We have been in contact
with them and they have been perfectly willing to engage with
us on the issue. We are certainly seeking answers from them.
But when the Republican senators, and I guess, Democratic--I
mean, Republican House Members as well, requested that GAO
investigate this situation and they are currently
investigating, we will respect that process as we respected it
in prior occasions.
So, I just wanted to get that on the record. And,
hopefully, we can get Ms. Emmanuelli Perez back on and get her
sound corrected. Are you there?
Ms. Emmanuelli Perez. Yes, sir. Can you hear me?
Chairman Yarmuth. We can hear you. You are still a little
garbled.
Ms. Emmanuelli Perez. Oh.
Chairman Yarmuth. Let us try it again, though.
STATEMENT OF EDDA EMMANUELLI PEREZ
Ms. Emmanuelli Perez. OK, thank you very much. I apologize
for these connection problems here.
Chairman Yarmuth. All right.
Ms. Emmanuelli Perez. So, Mr. Chairman, Ranking Member
Smith, Members of the Committee----
Chairman Yarmuth. You have five minutes.
Ms. Emmanuelli Perez.----thank you for the opportunity to
discuss Congress' constitutional power of the purse. The
Government Accountability Office's role in serving this power,
and several legislative proposals to strengthen this power.
Since our creation a century ago, GAO has performed audits
and investigations and issued legal decisions to support
Congress in its oversight of executive spending. GAO also has
been vested with additional statutory responsibilities to
oversee the use of public money. For example, under the
Impoundment Control Act, we must review any special messages
the President submits pursuant to the Act, and report to
Congress when a special message is either improperly classified
or not transmitted at all. We are regularly providing technical
assistance to Congress and executive branch agencies.
We published the Red Book, a multi-volume appropriations
law treatise that is relied upon across the government and we
teach a principles of appropriations law course opinion that
should be prudently considered. And the Supreme Court has cited
GAO's Red Book in support of its appropriations law matters.
GAO takes seriously its role in protecting Congress' power
of the purse. Today, I would like to discuss several
suggestions we have for legislative changes that will
strengthen Congress' power of the purse and provide increased
transparency.
First, we would like to recommend that Congress amend the
Impoundment Control Act to expressly preclude the withholding
of budget authority through its expiration to ensure the
prudent obligation of appropriated budget authority.
The Impoundment Control Act provides a president with the
legal authority to temporarily withholding funds from
obligation with specific notice to Congress and meeting
specific conditions. It is critical to maintain the careful
balance of the Impoundment Control Act proposals to cancel
budget authority. When Congress does not act to rescind funds,
it appropriates its funds for obligation.
In 2018, we issued a decision requested by Mr. Yarmuth and
Mr. Womack where we examined whether the President had the
authority under the Impoundment Control Act to withhold budget
authority through its date of expiration. We determined that
the President does not have this authority. And Congress can
clarify the extent of that authority by explicitly prohibiting
the withholding of funds through their date of expiration.
Second, we recommend that the Department of Justice report
to Congress on whether it will prosecute reported
Antideficiency Act violations. In addition to appropriate
administrative discipline it should contemplate criminal
penalties for knowing and willful violations. And that threat
is an essential deterrent. To our knowledge, there has never
been a criminal prosecution of an Antideficiency Act violation.
And a reporting requirement would ensure that consideration of
that liability for all by the enforcement of the Act.
Third, we recommend that Congress clarify the reach of the
Antideficiency Act to correct the underreporting of
Antideficiency Act violations. Although the Office of
Management and Budget just yesterday amended its Circular No.
A-11 reinstating its instruction that the agencies report
Antideficiency Act violations found by GAO, we recommend that
Congress amend the Antideficiency Act to clearly require
agencies to report. When OMB had changed its longstanding
guidance, we reported six Antideficiency Act violations to
Congress that agencies failed to report. This will ensure that
any future changes to OMB instructions do not interfere with
the transparency, increased visibility of the agency
operations, and congressional oversight. We also recommend that
Congress encourage the agency in spending appropriate funds.
And Congress could require that agencies report on the expired
and canceled balances in their appropriation accounts. This
information would increase the visibility to agency operations,
strengthen congressional oversight, and help Congress and GAO
identify potential violations of law.
Finally, we recommend that Congress require agencies to
respond to GAO's request for information within a certain
period of time. Delays in receiving information impede our
ability to issue decisions in a timely manner and impacts
Congress' ability to conduct its oversight functions.
Each of these legislative proposals will strengthen
Congress' power of the purse, which is a key check on the power
of the other branches. James Madison called it the power that
allows Congress to reduce all the overgrown prerogatives of the
other branches.
Chairman Yarmuth, Ranking Member Smith, and Members of the
Committee, this completes my prepared statement. I would be
pleased to answer any questions you may have. Thank you.
[The prepared statement of Edda Emmanuelli Perez follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Chairman Yarmuth. Thank you very much for your testimony.
We will now begin our question and answer session. As a
reminder, Members can submit any questions to be answered later
in writing. Those questions and responses will be made part of
the formal hearing record. Any Members who wish to submit
questions for the record may do so by sending them to the clerk
electronically within seven days.
As is my custom, I am going to reserve my time, questioning
time, to the end of the session. I believe the Ranking Member
is going to go in his normal order. But first I will recognize
the gentleman from Pennsylvania, Mr. Boyle, for five minutes.
Mr. Boyle. Thank you, Mr. Chairman. I appreciate that and
you holding this hearing on such an important piece of
legislation. It goes back to what happened almost a quarter of
a millennium ago, right here from the city that I am speaking
to you from, Philadelphia, when our nation's founders gave
Congress the power of the purse. Unfortunately, in so many ways
and not just in the power of the purse, we have seen, in my
view, a migration of power from the legislative branch to the
executive branch really over the last 20, 25 years. And,
frankly, that has happened in Administrations of both parties.
So, I think it is crucial that Congress again reassert its
role in holding the power of the purse. Our founders thought we
would jealously--we as members of the legislative branch, would
jealously guard our powers. Unfortunately, as intense
partisanship has taken hold, and we have even heard some of
that already this hearing, as that intense partisanship has
taken hold, it has allowed the executive branch to creep into
our territory. So, I think this legislation is important. I am
supportive of it.
Let me turn to Mrs. Hempowicz, and I apologize if I am not
getting your name pronounced exactly correctly. But let me ask
you specifically on the question of transparency. If Congress
makes a spending decision that is transparent, I am very
concerned about secrecy and apportionments when it is not
Congress. As I mentioned, when we use our appropriations power,
you do have transparency. What happens right now when we do see
an executive apportionment? Is Congress aware of it? Is the
public? What rules right now govern the transparency of that
non-legislative process?
Ms. Hempowicz. Thank you so much for that question,
Representative. And I share your frustration with the ceding of
power, congressional power, to the executive branch. Right now,
when apportionment directives are issued by OMB, there is no
transparency requirement. Congress may see them. The public may
see them if, you know, an interested party--if Congress asks
for them and goes through a lengthy accommodations process and
you may receive them. If members of the public submit Freedom
of Information Act requests, which also take a great deal of
time to reach fruition, we might also receive--we might have
transparency there. But it is not guaranteed. And you are right
in the way that Congress passes laws, those are public. That is
how lawmaking is supposed to be.
I think the excess secrecy here by the executive branch not
only is making congressional oversight harder, but I think it's
part of what is fueling this growing public concern about
corruption in government. And I think the way to answer that,
you know, I know it is a cliche, but sunlight is the best
disinfectant. And so, I think this is certainly an area where
more transparency would not only help Congress, but it would
help the public.
Mr. Boyle. Thank you for that. The natural followup then is
what suggestions or ideas would you have on how we can improve
transparency in those sort of executive branch apportionment
decisions.
Ms. Hempowicz. Yes, well, I think, you know, the first
thing I would do is I would recommend passing the congressional
Power of the Purse Act. But then going even further than that
legislation, I think there needs to be additional transparency
around opinions issued by the Office of Legal Counsel at
Department of Justice. While the congressional Power of the
Purse Act would require transparency of opinions, OLC issues
around interpreting the executive's budget authority, that is
the only section of those--that is the only--sorry--subset of
those opinions that would be required to be transparent under
this law. And I think there is certainly a lot of room and
particularly when we are talking about congressional
authorities. So, enforcing congressional subpoenas, things like
that, you know, the OLC has wielded an incredible amount of
power and almost always in favor of more secrecy for the
executive.
Mr. Boyle. Great. Well, thank you very much, Mr. Chairman.
With that, I yield back. There you go.
Chairman Yarmuth. All right. I am having trouble unmuting.
Thank you, Mr. Boyle. And I now recognize the Ranking Member
Mr. Smith of Missouri for 10 minutes.
Mr. Smith. Thank you, Mr. Chairman. First, I just want to
raise my frustration with these virtual hearings. It really is
a disservice to all the Members of the Budget Committee
whenever one of the key witnesses that you all have from GAO,
we can't hardly understand or hear much of what she is saying.
I am going to start my questions with her. I hope we can answer
them. But I do know that we have retrofitted the budget room so
that we could actually do a hybrid hearing. And I would
strongly suggest that we get back to regular order, Mr.
Chairman.
Chairman Yarmuth. We want to as soon as possible. But I
think we have connected her with a phone line now so she should
be clearly audible.
Mr. Smith. Thank you, Mr. Chairman.
Chairman Yarmuth. Thank you.
Mr. Smith. Ms. Perez, I will start with you. As you are
aware, on March 23, 2021, 71 Republican Members of Congress,
including myself, joined 40 Republican senators in requesting a
GAO legal opinion on suspension of border wall construction
contracts and withholding appropriated funds. I ask unanimous
consent, Mr. Chairman, to submit this letter into the record.
Chairman Yarmuth. Without objection, so ordered.
Mr. Smith. Thank you, Mr. Chairman. Ms. Perez, can you
provide any status update on when GAO will issue this opinion?
Ms. Emmanuelli Perez. Yes. Yes, sir. We do have right now
pending a decision that we are working on. We have asked OMB
and DHS to provide factual and legal views to us. And we are
expecting their responses right now mid to late next week. We
did actually begin looking at this issue when the President
announced this in January. And, of course, also accepted the
request signed by you and various other Members. But it is
something we have been looking at and are asking OMB and DHS to
provide us with information.
Mr. Smith. OK. So, Ms. Perez, you are telling me that GAO
started looking into this without any Member of Congress
requesting it?
Ms. Emmanuelli Perez. Yes, that is correct. As part of what
we do under the Impoundment Control Act, if we become aware of
a potential impoundment, we do start looking into it. Sometimes
we learn through it from Congress. We have learned through it
through the media. In this case, of course, the President did
issue a proclamation. So, therefore, we did become aware of a
possibility of an Impoundment Control Act issue and did start
looking at that at that time.
Mr. Smith. Thank you, Ms. Perez. I just want to reiterate,
given that this is an ongoing hold, and it is currently
happening resulting in a clear humanitarian crisis at our
border, I believe that it is the responsibility of GAO to make
this decision very quickly, as has I pointed out in prior
letters when GAO addressed the Ukraine funding in the prior
Administration. That was after all of this was done. And when
Senator Van Hollen submitted the letter, it was in December.
And on January 16th I believe it was, you all had a decision.
So, I definitely want to encourage, because of the crisis
on the southern border, that this decision gets out there
easily because, I mean, I think it's pretty straightforward
that this Administration is violating the law. And I just would
highly encourage that just for what is going on and as a Member
of Congress, that is the power of the purse.
So, I would like to go to--you know, it has been 100 days
since President Biden has suspended the border wall funding.
Can you tell me what day it was that GAO started to look into
this?
Ms. Emmanuelli Perez. When we heard of the President's
decision to pause the funding, you know, when we heard of the
declaration that he did make, we immediately did start talking
within GAO to start looking at what were the issues we needed
to find. Who do we need to talk to. What type of information do
we need to obtain. And then consequently, we also received the
request from Members such as yourself. So, we will be making
that decision.
Mr. Smith. I look forward to that and I hope that you will
notify us as soon as you have that decision.
Ms. Emmanuelli Perez. We absolutely will. And we certainly
share, you know, the urgency for having these decisions done as
quickly as possible. We do look forward to hearing from OMB and
DHS very soon. So, we hope that that will give us the
information that we need to make that decision.
Mr. Smith. Thank you. I will move on to Mr. Paoletta. It
has been 100 days since President Biden suspended construction
of the U.S. southern border wall and paused funding for border
wall construction. These actions appear, in my opinion, to
violate the Impoundment Control Act. This Committee was very
active in its oversight of the executive branch last Congress,
but the Democrats have seemingly been pretty silent on the
biggest power of the purse abuse occurring right now in the
first three hours of this current Administration. That is why
my colleagues and I on this Committee have demanded a hearing
on the Administration's constitutional abuses, the violation of
U.S. law, and unjust pause on border wall construction.
I am glad this hearing will provide an opportunity to
discuss those issues and I ask unanimous consent to submit the
letter written by Committee Republicans on this issue, dated
March 29, 2021, into the record, Mr. Chairman?
Chairman Yarmuth. Without objection, so ordered.
[Letters submitted for the record follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr. Smith. Thank you, Mr. Chairman. So, under the
Impoundment Control Act, what are permissible grounds to hold
or pause funds?
Mr. Paoletta. Well, you can pause--thanks, Mr. Smith. You
can pause funds if you can send up a deferral notice to the
Congress. You can pause funding if you are sending up a
recission package to the Congress. If you are in the day-to-day
management of your funds--and it is interesting, I listened to
this discussion as a person who has been part of the executive
branch--if you are trying to implement the program and you need
to pause the money to figure out how best to spend that money,
within the confines of the appropriation, you can pause it.
OMB has an apportionment authority too, right? As the
testimony and oral testimony discussed. And it is day-to-day
operations within OMB to apportion funds. So, if you have 2-
year funds, you might apportion it so that half those funds are
unavailable for the first year, right? That is an
apportionment, right? It is putting those funds off. That is
just--we view that--or the executive branch views that as just
day-to-day Administration of our implementing programs.
Mr. Smith. So, I just want to get this right. So, funds
cannot be withheld for a policy reason?
Mr. Paoletta. Again, so, in terms of--my view is that so
long as you are trying--so, if you are trying to implement the
program consistent with the appropriations and they are
multiple ways you can do that, right? So, it is consistent with
your appropriation and trying to figure out if you can--I will
take the perfect example is the WHO funds, right, on that
issue. The appropriation was to fund international
organizations. There are scores of them, OK? And Congress when
they passed the appropriation, said just pass, you know, you
have so much money to fund international organizations. One of
them was the WHO. We paused those funds--or the President. It
was an apportionment. Paused them to figure out where else
could we spend that money within the appropriation, OK? That is
a policy, right? It is a policy discussion about how best we
acquire those funds within the scope of that appropriation.
What is happening with President Biden's hold is that he is
specifically thwarting the appropriation. He wants to defy the
law in implementing that program.
Mr. Smith. So, I am about to run out of time. And I want to
try to get some stuff in the record as quickly as possible. So,
if you could try to give me your opinion quickly, I would
definitely appreciate it. But do you believe that the executive
branch violated GAO standard of the Impoundment Control Act
when it began withholding funds for the border wall?
Mr. Paoletta. One hundred percent.
Mr. Smith. Do you believe withholding funding for the
border wall is an attempt by the Administration to circumvent
congressional intent?
Mr. Paoletta. I don't need to think that. President Biden
has said that.
Mr. Smith. OK. How is pausing funds for the border wall
different than the temporary hold that occurred on funds for
Ukraine, which as you know, GAO investigated?
Mr. Paoletta. Sure. We paused those funds to allow policy
process to go on and figure out how best to spend those funds.
If you looked at that first hold, it was 10 days. It was to get
a policy discussion because the President had expressed
concerns about the spending of that money in the way it may
have been spent. So, we paused it for 10 days, you know, and
will shorter holds to allow a policy discussion to happen. It
was to be done consistent with that appropriation and, in fact,
it was obligated consistent with that appropriation.
Mr. Smith. Perfect. OK, when it comes to Congress' power of
the purse, it appears Congress itself is failing to do its job.
As I mentioned in my opening statement, Congress has failed to
follow regular order when it comes to budgeting and
reauthorizing programs. Would you agree that a focus when
discussing Article I authorities should include how Congress
has, on its own, ceded its power of the purse by failing to
authorize and appropriate in a regular, detailed, and timely
manner?
Mr. Paoletta. Yes, 100 percent.
Mr. Smith. You know, Congress has consistently failed to
meet its budget and appropriations responsibilities for Fiscal
Year 2021, alone. Four continuing resolutions were enacted
before enacting a huge omnibus appropriations act. And Congress
has already missed its deadline to pass a Fiscal Year 2022
budget resolution. And, therefore, it appears Fiscal Year 2022
funding will likely be delayed and result in yet another
omnibus appropriations act. Can you comment on how Congress'
power of----
Chairman Yarmuth. The gentleman's time has expired. I have
actually been already generous with the Ranking Member.
Mr. Smith. Well, I appreciate that. And I think that Mr.
Chairman, we probably could be more efficient in asking
questions if we could actually be in the room. So, I would
reiterate on behalf of the House Republicans, that we are all
ready. We are all ready to stand in a committee room with a
mask or without a mask in an in-person hearing. And if you need
all of us to sign to do that, we will do it.
Chairman Yarmuth. All right. You made your position very
clear. I appreciate that. I now yield five minutes to the
gentleman from North Carolina, Mr. Price.
Mr. Price. Thank you, Mr. Chairman. I would like to quickly
review four episodes from 2019 as the premise for my question.
First of all, President Trump withheld duly appropriated funds
from Ukraine. The GAO later determined that that was, in fact,
an impoundment in his attempt to extort President Zelensky.
Second, the President totally withheld funds, appropriated
funds, from the West Bank in Gaza, foreign aid funds. He did
the same with funds to the Northern Triangle countries of
Central America. And we struggled to get those funds
reinstated.
Third, in early 2019, Leader McConnell acquiesced in
Trump's demand that the border situation be declared a national
emergency. Now, that let us reopen the government, but it also
freed the President to spend unappropriated funds on his border
wall.
And fourth, in 2019, President Trump bypassed congressional
review under the Arms Export Control Act for arms sales to
Saudi Arabia by declaring an emergency.
I would like, Mr. Chairman, to ensure that we can hold the
record open for any Republican Members who would like to
document the kind of objections they made at that time to any
of these actions.
Chairman Yarmuth. We can hold the record open for a week.
We will do that for a week.
Mr. Price. I think that would be useful to see what kind of
objections were made to any of these by our Republican
colleagues.
And my questions are these, and maybe we start with Ms.
Reynolds or Ms. Hempowicz. First of all, how do we do something
about this unrestrained, uncontrolled declaration of
emergencies? What kind of boundaries should be placed around a
president's power to declare emergencies and then to spend
money as he pleases? Whether he just spends the money or
whether he diverts the money from appropriated sources. And
then, second, how can appropriations be protected? You know, we
struggled in the State and Foreign Operations Appropriations
Subcommittee to figure out how in writing the next year's bill,
how do we prevent another withholding of West Bank and Gaza
funds? How do we prevent just a total shutoff of any funds to
address the sources of migration in Central America? Are there
additional--did we miss something? We had a very had time doing
this.
So, those two questions. The enhancement of some kind of
controls over emergency declarations, willy nilly emergency
declarations. And also, how do you protect appropriations?
Dr. Reynolds. I am happy to offer a few comments first and
then let Mrs. Hempowicz come in.
So, Representative Price, on the national emergencies
piece, I think one of the most powerful pieces of the Power of
the Purse Act is the proposal that would shift the current
mechanism for congressional review of national emergencies
declarations from a joint resolution of disapproval to a joint
resolution of approval.
And as I mentioned in my statement, this situation arises
in part because of a Supreme Court decision in 1983. But there
are other examples where Congress has said that it believes
that it should have the power to review, in an approval manner,
decisions made by the executive branch. The recissions
provisions of the Congressional Budget Act are one example. So,
I would point to that in response to your first question.
And in response to your second question, I think that some
of the aspects of the Power of the Purse Act, especially around
the transmission of information from the executive branch to
the legislative branch, are the kinds of things that you are
looking for to guarantee that in your case, the State and
Foreign Operations Subcommittee of the Appropriations Committee
is getting as much good information in a timely fashion that it
can to make informed decisions in the next year's
appropriations process.
Ms. Hempowicz. And I agree with everything Dr. Reynolds
said. And I just want to say--make one additional point on the
national emergencies question. After President Trump declared
the emergency at the southern border, there actually was
incredibly bipartisan pushback in both the House and Senate.
The President had to do, you know, had to use the first veto of
his presidency to over--to veto the Congress telling him in a
bipartisan way, we object to this emergency authority being
used this way immediately after we, you know, had a long,
drawn-out government shutdown over this very issue.
And I just want to highlight that Members of Congress from
both sides of the aisle objected there. Not because they
objected to always to the policy that was being enacted by the
President to build the border wall, but because they objected
to how the President was making an end-run around Congress and
really usurping the Congress' power of the purse in that
instance. And so, I just wanted to highlight that under the
National Emergencies Act, again, these are authorities that the
Congress has delegated to the executive. And so, it doesn't
make sense to me that it is so easy for the executive to work
against Congress' expressed intent when it comes to executing
those powers. And so, I think the voting--a vote by Congress as
envisioned by part of this--by part of the congressional Power
of the Purse Act where Congress has to approve an emergency for
it to go longer than 30 days is exactly the way to address that
problem.
Chairman Yarmuth. Thank you for your response. The
gentleman's time has expired. I now recognize the gentleman
from California, Mr. McClintock, for five minutes.
Mr. McClintock. Thank you, Mr. Chairman. I just wanted to
offer the thought that we have got no standing to complain
about executive actions whoever the president is until we have
thoroughly cleaned up our own house. Our refusal, under both
Republican and Democratic majorities, to follow our own rules
and meet our own responsibilities, I think is at the heart of
the fiscal mess that we are facing today.
Let me mention three issues. Our failure to follow our own
rules on unauthorized appropriations. Our failure to follow our
statutory responsibilities under the 1974 Budget Act. And,
finally, this return to earmarks that I am ashamed to say
Republicans in the House are now joining. Thank God the Senate
Republicans are not.
First, let us talk about unauthorized appropriations. Ever
since 1835, the rules of the House have required that
appropriations may only be for purposes authorized by law.
Under that rule--it is still on the books--any member can raise
a point of order to block any unauthorized appropriation. This
provision established a process that is absolutely essential if
the House is to meet its constitutional responsibilities to
superintend the nation's finances. First, a program has to be
authorized by Congress in a process that begins in an
authorizing committee. Only then does a separate action
appropriate funding for it.
This process imposes on Congress the responsibility
periodically to review these programs. As a program's
authorization expires, Congress has to revisit it to ask the
obvious questions. Is it effective? Is it meeting its goals? Is
it still needed? Is it worth the money we are paying for it?
And depending upon the answer to these questions, Congress then
renews the program, reforms it, or lets it die.
The failure of this House and the Senate to agree on recent
appropriations has often degenerated into these continuing
resolutions and merely tweak last year's spending and then
extend it in the future. And when we do pass appropriations
bills, about one-third of the discretionary spending are for
purposes not authorized by law. The law presumes authorizations
that last years and sometimes decades ago. This is happening
because the 1835 rule forbidding unauthorized appropriations is
consistently waived, stripping Members of their right to
object.
The second issue is our failure to follow the budget law.
You know this, the 1974 Budget Act gives the House a very
powerful set of tools to control spending and balance the
budget. For years on the House Budget Committee, I have heard
it said that, well, the budget's merely an aspirational
document, offering a vision for the direction the government
should take. That is simply not true.
The budget is an operational document, the single most
important tool we have to control spending. The problem is we
just don't use it. I have also heard incessantly that, well, it
is a mandatory spending and that is beyond our control. Well,
the budget resolution sets limits on the discretionary side. It
is appropriated annually. That is about one-third of our
budget. It also limits the mandatory spending that is set by
statute. That is about two-thirds of the budget. But it also
gives us powerful tools to enforce both limits. The problem is
we just don't use it.
On the discretionary side, as the deadline approaches and
the threat of government shutdown looms, the appropriations
bills are cast aside in favor of stopgap measures that continue
the spending trajectory without reform. And on the mandatory
side, enforceable limits are supposed to be placed in the
reconciliation instructions that are sent to the House
authorizing committees. Those committees are then required to
make conforming statutory changes. If the committees fail to
act, the Budget Committee can do so directly. But this powerful
process is never used. Why? Because decisions on reforming
mandatory spending, mainly entitlement programs, are those
difficult decisions in our fiscal policy. It is easier not to
make them and just blame the process.
And finally, I want to address this return to earmarks,
aided and abetted by my own party. It is an ominous
development. There has been a set of principles since the Magna
Carta that the authority that appropriates money should not be
the same authority that spends that money. That is why we have
a separation of powers. Congress makes law but cannot enforce
it. The President enforces law but cannot make it. Congress
declares war but cannot wage it. The President wages war but
cannot declare it. And Congress appropriates money but cannot
spend it. The President spends money but cannot appropriate it.
There is a reason why earmarks breed corruption. They breakdown
that same separation of powers that is at the center of our
constitutional architecture.
So, I would simply say in response to the subject matter,
Mr. Chairman, with all due respect, the fault, dear Brutus, is
not in our stars and it is not in our presidents, but it is in
ourselves that we are underlings. I yield back.
Chairman Yarmuth. The gentleman's time has expired. I now
yield five minutes to the gentlewoman from Illinois, Ms.
Schakowsky.
Ms. Schakowsky. Thank you, Mr. Chairman. You know, I have
to be honest, other than the Members of Congress and legal and
constitutional scholars, I really don't believe that most
everyday Americans are thinking about the Congress' power of
the purse and what the framers intended. And while I certainly
believe that it is critical that the Congress control how the
peoples' tax dollars are spent, the people are thinking more
about things like whether or not they have access to quality
healthcare, that their children are safe at school, and that
they are able to pay their bills, their rent, and their
mortgage.
So, what I would like to do is go witness by witness and
ask if you can give me an example of why these questions about
the control of federal spending matter in the real world. I
will start with Ms. Reynolds, just real short because I don't
have that much time.
Dr. Reynolds. Sure, thank you. I think what is important to
remember is that Congress and the executive branch both have
roles to play here. The executive branch makes certain
decisions. But someone has to make sure those are good
decisions, and that is Congress' responsibility. And so, if you
have a constituent who calls the Social Security and waits a
long time on hold, how else are you supposed to help them than
sort of investigate and oversee what is happening?
Ms. Schakowsky. That is an example. That is good. That is
an example. OK, and Ms. Hempowicz--Hempa----
Ms. Hempowicz. You got it.
Ms. Schakowsky. Did I get it? OK, Hempowicz.
Ms. Hempowicz. Yes. I agree with you. I don't think--even I
am not sitting around my kitchen table talking about
apportionment decisions. But I think one thing, not a specific
example, but I think the growing tension between Congress and
the executive branch and the fights that publicly play out over
access to information and access to documents, that Congress
needs to conduct rigorous oversight. I think that is certainly
permeating to the kitchen table. And I think as we see I
think--and that points to the necessity for bills like the
congressional Power of the Purse Act to show your constituents,
we are doing what we can to empower ourselves----
Ms. Schakowsky. I hear you.
Ms. Hempowicz.----to address your concerns.
Ms. Schakowsky. I hear you. And, Ms. Emmanuelli Perez, if
you could--Emmanuelli Perez--if you could answer that as well?
Ms. Emmanuelli Perez. Yes, certainly, ma'am.
Ms. Schakowsky. An example would be good.
Ms. Emmanuelli Perez. Yes. It is important because even
though everyday citizens may not be looking specifically at
these types of decisions all of the time, they do see where the
government gives them service. They do see where the branches
are either, you know, negotiating or disputing. And so, it is
important to them, as well, to make sure that everyone has the
information needed in order to carry out our function.
Ms. Schakowsky. OK, and Mr. Paoletta. I have a feeling I
know what your example is going to be but go ahead. Can you
give----
Chairman Yarmuth. You need to unmute.
Ms. Schakowsky. Go ahead.
Mr. Paoletta. I apologize. It is important for Congress to
write clear laws, you know. So, they set out the program
requirements and then the executive branch is going to
implement that law. And I think that is the problem in terms of
why people are sort of when they watch Congress and the
executive branch fighting, that it is a lack of clarity from
Congress as to what they expect from the executive branch. And
what I see and what I saw are Congress, you know, Congress
encroaching on the executive branch in their implementation of
the law.
Congress passes the law. That is what they do. They can't
day-to-day implement the law. That is why the President does
it. That is his constitutional responsibility. So, I think
writing clear laws so that there is better focus on how that
law gets implemented.
Ms. Schakowsky. Thank you. I barely have time for my
question, actually, which is about the role of the GAO. And I
think I will jump to if Ms. Emmanuelli Perez, if you could talk
about and elaborate on what the role of the GAO decisions play
in congressional oversight of the executive spending. I know
you talked a bit about that, but if you could elaborate on
that. Are you still here?
Ms. Emmanuelli Perez. Yes, ma'am. So, the role of GAO is
really to help Congress in its constitutional power of the
purse. It is important that Congress has the information that
it needs and GAO through its audits and in its decisions, is
the one that is providing that information and really helping
Congress in terms of carrying out those laws, carrying out the
power of the purse, and ensuring that Congress can then make
changes as it sees fit and ensures that the executive is
carrying that out appropriately.
Ms. Schakowsky. Well, I have always felt that the GAO has
played a very important and constructive role. So, I thank you
for that, and I yield back.
Chairman Yarmuth. The gentlewoman's time has expired. I now
recognize the gentleman from Wisconsin, Mr. Grothman, for five
minutes. You need to unmute, Mr. Grothman. He has left the
building. I don't see him there visually. So, we will come back
to him. I now recognize the gentleman from Michigan, Mr.
Kildee, for five minutes. Mr. Kildee? All right, he probably
didn't expect to be called on so soon. Is Mr. Smucker
available?
Mr. Smucker. Yes. Can you hear me, Mr. Chairman?
Chairman Yarmuth. Yes, Mr. Smucker. The gentleman from
Pennsylvania is recognized for five minutes.
Mr. Smucker. All right. Sorry about that, caught me by
surprise a little bit there.
Chairman Yarmuth. Yes, I know. All right.
Mr. Smucker. Thank you so much for holding this hearing,
Mr. Chairman. I was pleased that we are holding a hearing on
this important topic. And actually, a little surprised given
that it is based on the actions taken by President Biden on his
very first day in office relative to the----
Ms. Schakowsky. Is there any reason for me to stay on?
Mr. Smucker.----relative to the border wall. I think if we
were to be consistent with the comments made last Congress by
Democrats and by the Chairman, we should be calling this
executive order illegal. I don't know that I have specifically
heard that word today, but, you know, this is I think an
important discussion to have. And, certainly, you know, to the
point that was made earlier about what people care about,
people care, certainly in my district, about what is happening
on the southern border.
We are seeing a real crisis here on the border. I can tell
you I saw firsthand along with, you know, many of my colleagues
who have visited the border and seen the impact on the border.
Certainly, the impact on the border patrol agents who are just
completely overwhelmed. And so, this is a real crisis that we
are dealing with as a result of what I think is an illegal
action by the President: freezing the congressionally
appropriated funding for the construction on the southern
border wall.
So, Mr. Paoletta, you know, I would just like to ask you
whether you would make that statement? Based on your work at
OMB and the standard that was set last Congress as we talked
about President Trump's actions, do you believe that the
President's action in this case were illegal?
Mr. Paoletta. Yes, I do, Congressman. I think they are 100
percent illegal, and it is very clear from his actions and his
statements. During the campaign, he said he wouldn't build
another foot of wall. On his first day, he issued an executive
order pausing all funds. Every report is that all funds have
been paused and construction has been completely stopped, which
is a terrible policy decision, but for purposes of legality, it
is illegal.
His press secretary also said they weren't going to spend
any more money on the wall. And then he put it in his Fiscal
Year 2022 discretionary request that he wants to have Congress
rescind all unobligated balances. So, that is completely
different than what we were doing in the Trump Administration,
which was within the appropriation, trying to figure out how we
would spend those funds.
So, it was consistent with the appropriation. It wasn't
defying the appropriation. That is why this is illegal. And it
is interesting to hear GAO say that she started looking at it
and talking internally. It would be interesting to know exactly
when they reached out to the Administration to ask their views.
It seems like it was well after the 2-months when the senators
in the House sent a letter asking them to look at it.
Mr. Smucker. Yes, well, they will have an opportunity to
answer that question a little later. But, you know, I would
like to, I guess, hear from you, why do you think we are not
talking about this in those terms, particularly in what we have
seen my colleagues from the other side of the aisle really talk
about the Administration last cycle. Why aren't we doing that
this cycle relative to this action?
Mr. Paoletta. You know, I was on the--we were on the
receiving end of the Trump OMB of the letter from the Chairman
on, I think it was September 27, 2019, asking us for a ton of
documents. He says he has reached out to OMB to ask for
information. That is a little different in terms of how he
handled the Trump hold. And the media has been completely
silent on this. And any story--in fact, there was a political
story that ran complete cover, in my opinion, for the Biden
hold. And so, it is really to me disappointing that, you know,
if you are going to be--and, you know, enforcing or wanting to
strengthen the power of the purse, you would be using it right
now on this President for what he is doing.
And it may be----
Mr. Smucker. Thank you. I am going to stop you at that if
you don't mind. I am running out of time, you know. And I do
appreciate the Chairman holding this hearing. I said that. I
meant that. And he has certainly introduced legislation that
would, you know, give more Budget Committee responsibilities to
the GAO.
I think a better solution would be to empower this very
Committee to fulfill its responsibility in the government
funding process. And I am talking about marking up a budget
resolution for a given fiscal year, which we have not done. It
is now nearly May, and we have yet to even consider a Fiscal
Year 2022 budget resolution. And meanwhile, the appropriators
are already drafting their bills. You know, it is additionally
under threat of a second multitrillion dollar bill being passed
through reconciliation. You know, it's a tool that is supposed
to be used to reduce the deficit and not increase it by
trillions.
So, you know, I think to restore fiscal accountability,
restore transparency, responsibility, we got to return to
regular order within this Budget Committee to for us to play
and continue to be a key player in this process. I think it is
very important that we do that. Thank you, Mr. Chairman.
Chairman Yarmuth. Thank you. The gentleman's time has
expired. I will remind you, Mr. Smucker and others, that we are
now awaiting a GAO opinion, which according to our witnesses
notably could soon to be issued. So, we will be able to know
what the GAO's opinion is in relatively short order.
With that, I don't see Mr. Grothman has returned. Has Mr.
Kildee returned? I will now recognize the gentlewoman from
California, Ms. Chu, for five minutes.
Ms. Chu. Thank you, Mr. Chair. Dr. Reynolds, I represent a
district in California, and in California, there are several
so-called sanctuary cities. These are cities that were very
disturbed with the Trump Administration's approach to
immigration enforcement. And especially with his wanting
federal law enforcement to enter state and local jails to
question and prosecute people for their immigration or
citizenship status, and, therefore, frightened members of their
cities who might not cooperate with the police.
Well, one of President Trump's first executive orders in
January 2017, directed federal agencies to withhold funds from
these so-called sanctuary cities. The order was repeatedly
blocked in court, but the Administration continued to pursue it
for the entirety of President Trump's term.
And then, there was another attempt to target California in
December 2020, as California was about to hit the peak of
coronavirus cases. That is when the Trump Administration
announced it would be withholding $200 million in Medicaid
funding quarterly because of California's requirement that all
private health plans in our state cover abortion services. Not
only did this put the lives of Californians struggling to fight
off a pandemic in danger, it showed blatant executive overreach
because the funding the Trump Administration threatened to
withhold, had nothing to do with the alleged violations or
restrictions on abortion funding.
These repeated attempts to place unauthorized restrictions
and conditions on congressionally appropriated funds was, of
course, another attempted encroachment on Congress' power of
the purse. But it is also democratic unelected Administration
officials seeking to disburse the funds--were doing so
unilaterally without responding to voters and gaining approval
in Congress.
So, could you talk about the accountability measures that
the executive branch even needs when it circumvents Congress in
this way? How do Americans have less transparency into this
process when it happens this way?
Dr. Reynolds. Thank you, Representative Chu. It is a great
question. And I think it really comes back to the heart of what
is on the table here when we talk about this legislation, which
is that Congress needs as much information as it can get from
the executive branch to make responsible spending decisions.
And that includes information around the kinds of things that
you are describing.
I will also reiterate something that I mentioned in my
testimony, which is the increasing reliance or the increasing
need to rely on the federal courts by Congress to try and
enforce its spending and other policy decisions. And one major
challenge there and one of the reasons why Congress needs to
bolster its own authority is because that process is incredibly
slow.
So, you mentioned in the case of California, sanctuary
cities. And you talked a little bit about the length of time
that court fight went on. We have many other examples of
lengthy court fights. And so, one of the reasons that Congress
needs to give itself more tools is so that it does not have to
turn to the federal courts who move quite slowly in this area,
to try and have that as a backstop in these disputes with the
executive branch.
Ms. Chu. Thank you so much. Now, I would like to ask Ms.
Perez a question about the ability for GAO to operate. And that
is I am the--I was last October, the Chair of the Subcommittee
on Oversight for the Small Business Committee, and the GAO's
Director William Shear testified that the Trump Administration
refused to give GAO access to documents and information
concerning the implementation of the Paycheck Protection
Program. And also resisted implementation for an oversight plan
for PPP until December. Using this example of PPP, can you
describe why GAO needs timely access to agency documents and
information and how that may have hampered implementation and
congressional oversight of the program?
Ms. Emmanuelli Perez. Yes, ma'am. So, and this is an
example of when GAO needs access to information as quickly as
possible to be able to carry out its oversight for Congress.
So, in the programs that you are describing, obviously, we are
looking at the CARES Act and various funds and authorities
provided there. And so, in order to give Congress the most
timely advice and the most timely review, we need to have that
information promptly.
With those types of delays, unfortunately, it then delays
our reporting to Congress. It delays our ability to be able to
give you the advice that you need and the information that you
need. So, that definitely does have an impact on Congress'
oversight.
Ms. Chu. Thank you. I yield back.
Chairman Yarmuth. Somebody muted me. I now recognize the
gentleman from Texas, Dr. Burgess, for five minutes. I know Dr.
Burgess is here. Unmute your mic, please, unless he left. I can
see Dr. Burgess on the screen. Dr. Burgess, you have five
minutes for your questions.
Mr. Burgess. Well, can you hear my question?
Chairman Yarmuth. No, we didn't. Now we hear you though.
Mr. Burgess. All right, very good. Thank you, Chairman.
Thank you to the witnesses for joining us today. Mark Paoletta,
it is good to see you again. Mr. Paoletta spent a good deal of
time as Chief Counsel on our Oversight Investigations
Subcommittee on Energy and Commerce. A subcommittee that I have
always held in very high regard. One of the most important
subcommittees in the U.S. House of Representatives.
But I am just going to ask you again, Mr. Paoletta, and I
think the Ranking Member Smith and perhaps Representative
Smucker had also made this point, but it seems like we have got
a set of parallel circumstances. January 16, 2020, the
Government Accountability Office determined the President did
not withhold funds under the Impoundment Control Act for policy
reasons. And then on his first day in office, President Biden
signed a proclamation pausing all obligated funding for the
border wall construction and directing the Secretary of Defense
and Homeland Security to create a plan to redirect these funds.
So, is there a substantial difference between the actions
of then President Trump and now President Biden in regards to
those two activities?
Mr. Paoletta. Yes. They are completely different. When the
funds were paused on Ukraine, the very first hold was 10 days.
It was literally to try and pause the funding so that--because
there had been concerns about the funding expressed by the
President. So, there had been a process right below, that
doesn't end the process, right? In the executive branch, the
president is the person who makes the decision at the end of
the day. And so, we wanted to pause the funds to allow a policy
discussion to happen. I wasn't part of that policy process, but
we were able to pause those funds. And at the end of the day,
those funds were spent consistent with the appropriation,
right?
What is happening here is that it is completely designed to
thwart that appropriation because President Biden has already
said he doesn't want to build another foot of the wall. His
executive order said it is a waste of money.
Mr. Burgess. Let just ask you though if I could, the GAO
though made a determination when President Trump paused the
funding that seems like it would have to be consistent, it
would have to make the same decision about the pausing of the
border wall funding. In other words, the inconsistency of
coming to a different conclusion giving those two fact sets,
well, that just wouldn't be possible, would it?
Mr. Paoletta. It would be impossible.
Mr. Burgess. Well, I mean, that is what is so frustrating
for so many of us. I live in Texas, not on the southern border.
I live on the northern border. But made many trips down there
over there over the years and to see the border wall
construction literally halted and with big gaps and that is
where the cartels and coyotes are directing their human
smuggling and human trafficking. And it is heartbreaking.
It is, in fact, President Biden's own commander of the
public health service at the Dallas Convention Center where
2,400 of these young men remained under an emergency hold, he
said that we are responding to a--it is a crisis management
situation. Well, you wouldn't have a crisis management
situation if you didn't have a crisis.
Look, I just left another hearing and we are talking a lot
about budget process here today. And I know that is something
that can bore people, but you are very familiar with,
unfortunately, the oversight of the Environmental Protection
Agency and the Energy and Commerce Committee, for several years
going back to an IG report in 2015, when they suggested that
the Title 42 exceptions for salaries in the EPA were never
authorized by the U.S. Congress.
And, in fact, I had an opportunity to question the new
administrator. He seemed unaware of that. He did make a promise
that he would come back with forthright and transparent data
for the subcommittee about their hires. They are set to hire a
bunch of new people. They thought the Trump Administration made
too many personnel cuts. So, they are on a hiring spree. And it
concerns me that having never authorized the Title 42
exceptions to the senior executive service salaries, that the
possibility of overspending on those positions is a very real
one. So, would you agree that the authorization needs to occur
before the expenditure can happen?
Mr. Paoletta. That is the best way to do it. To authorize
programs and, again, pursuant to I think your House rules, you
would need to--it would be best to authorize before you
appropriate.
Mr. Burgess. Thank you. And, Mr. Chairman, Chairman
Yarmuth, I just have to also echo what Ranking Member Smith
said about getting back to normal hearings. Look, the Doctors
Caucus sent a letter to our House leadership. Many of us have
been vaccinated. Others have had the illness. We need to be
able to meet in a more normal fashion because there is just so
much you get out of an in-person hearing that you cannot get.
And we have seen the technical problems that we have
encountered. I encountered them on the E&E hearing as well. We
have to get passed that point. We can't do the peoples'
business if we can't meet as the people intended. And thank you
and I will yield back.
Chairman Yarmuth. Thank you, Dr. Burgess. And I was going
to save this until the end, but I will commit to the Ranking
Member and to you and all the Members of the Committee that the
next Committee we have, I will be in the hearing room. And we
will at least have a hybrid at that point. So, I want to
accommodate my friends on the other side and some of ours too.
I am sure we would all prefer to be back in that situation. But
I will be in the hearing room for the next hearing. I now yield
five minutes to the gentlewoman from Virgin Islands, Ms.
Plaskett.
Ms. Plaskett. Thank you, Chairman Yarmuth and Ranking
Member Smith for holding this hearing to explore how Congress
can reassert its power of the purse. I appreciate the
opportunity to examine this important issue. Several of my
colleagues have noted despite the Constitution's clear
delegation of tax and spending power to Congress, various
Presidential Administrations have steadily infringed on this
authority in recent decades.
This infringement is concerning because it represents a
shift in power away from our constituents who have elected us
and, therefore, a weakening of their voices in important
decisions regarding funding allocations. Dr. Reynolds, this
issue is particularly personal for me and for my constituents,
the American people of the Virgin Islands.
As some of you may remember, two Category 5 hurricanes,
Irma and Maria, struck the Virgin Islands in 2017, and caused
devastating amounts of damage that my constituents are still
grappling with every day. When I say still grappling with, we
have not to this date, had put up the mobile hospital unit.
FEMA and others have not agreed until just recently on the
mobile unit for us to have a hospital. Never mind the rebuild
of the hospital. And while Congress appropriated billions of
dollars to provide emergency relief for areas impacted by the
hurricanes, such as the example I gave you, the previous
Administration significantly delayed the disbursal of these
funding to both the Virgin Islands and Puerto Rico.
These delays have negatively impacted our ability to
recover from the disaster, to rebuild, and to prepare for
future hurricanes. We have seen this in inspector generals
reports just recently about Puerto Rico. Can you, Doctor, speak
to how recent encroachments by the executive branch on
Congress' power of the purse can lead to prioritization of a
president's political priorities over the needs of our specific
constituents?
Dr. Reynolds. Thank you, Congresswoman Plaskett. I
appreciate the question. And I think that your experience and
that of your constituents does illustrate one of the challenges
that is sort of inherent in Congress and the executive branch
having to work together to deliver services and meet the needs
of the American people. And I think that, again, one of the
purposes of this legislation of the issues that we are talking
about today, is to try to make sure that you, as Members of
Congress, are getting more information, better information, in
a timely fashion to be able to say to the executive branch you
are not doing what we, Congress, intended with our
constitutional tax and spend powers when we told you that you
have this money to spend on, in your case, replacing--building
a mobile that will be replacing a hospital in your district.
And so, I do think, again, that that is to Representative
Schakowsky's earlier request for examples of why this matters.
I think that is another good one. And I appreciate you raising
it.
Ms. Plaskett. Thank you. That leads me to you, Mrs.
Hempowicz. You recently discussed the lack of transparency
regarding Office of Management and Budget's apportionment
decisions, which show how money is being allocated within an
agency. And you have recommended that Congress require OMB to
publicly post all apportionment schedules, including special
notes in apportionment documents. Can you speak to how these
apportionment decisions can sometimes be used to advance a
president's policy goals rather than simply serving the
intended administrative purpose?
Ms. Hempowicz. Yes, thank you so much for that question.
You are right. You know, I think these footnotes, apportionment
footnotes are a very technical thing. And so, you know, I guess
an example of that is saying that, you know, money that has
been appropriated can't be spent until a report has been issued
about how those funds would be spent, or how the funds under
that project would be managed.
But it also, you know, there is no requirement for
specificity in these footnotes. And so, you can also get
something that is as vague as, you know, we are going to do an
interagency process to determine the best use of the funds.
That doesn't tell Congress a lot. That doesn't tell the
American people a lot. You know, what is that inter--what is
that interagency process? What policy are you trying to
accomplish? And that I should say was the reason given for
the--in the footnote on the hold for the Ukraine assistance.
And so, I think that just goes to show that like, you know,
these--the vague explanations are part of the problem. If there
was more--if there was more transparency to Congress you could
see that vague explanation, reach out to OMB, reach out to the
White House, reach out to the State Department and say, what is
this interagency process? Ask some of those questions. Because
it is not always something nefarious going on. But if you don't
have the information you need to conduct effective oversight,
nefarious things can be going on in the background that the
public will never know and the Congress will never know about
and can't correct for.
Ms. Plaskett. Thank you very much. And thank you, Mr.
Chairman, for the opportunity. This is very insightful, and I
yield back.
Chairman Yarmuth. The gentlewoman's time has expired. If he
is in the room, I don't see him, but Mr. Carter would be up
next. Mr. Carter of Georgia are you here? OK, if not, I don't
see Ms. Wexton of Virginia as well. But I know I see Mr. Scott
of Virginia, and so, we will come back and get any others who
might have been thrown off by the change in schedule. I now
yield five minutes to the gentleman from Virginia, Mr. Scott.
Mr. Scott. Thank you. Thank you, Mr. Chairman. I would like
to ask Ms. Emmanuelli Perez what is the legal effect of a GAO
conclusion that impoundment is inappropriate? Does it have any
enforcement effect?
Ms. Emmanuelli Perez. Well, sir, GAO doesn't enforce the
decisions that we issue. They are really intended for both the
Congress and the executive branch to have the benefit of those
legal decisions. So, in the case of an Impoundment Control Act
decision, when we say that the Impoundment Control Act has been
violated, the effect really is for the executive branch to
immediately have to release the funding. That is release the
withholding and ensure that those funds get obligated on time.
Mr. Scott. But if there is a disagreement, the disagreement
just lands. What is the recourse if there is a--if the
executive branch just disagrees with your decision, what is the
recourse under present law? And what would be the recourse
under Chairman Yarmuth's legislation?
Ms. Emmanuelli Perez. Yes, so, the resource under present
law is that, of course, since we at GAO can't enforce the
decision, it really is up to Congress to enforce it. So, you
know, in the case of the Impoundment Control Act or any other
appropriations law issue, Congress can certainly enforce that.
With respect to under the Chairman's Power of the Purse
Act, it would provide some additional authorities for the
executive branch to not take these additional legal, you know,
practices and look and try to use them in a way that are not,
you know, in accordance with either the Impoundment Control Act
or the Antideficiency Act or other laws.
So, it really would be emphasizing, you know, certain
reporting, emphasizing certain actions that the executive
branch would have to take and ensuring that those follow the
decisions as shown by GAO.
Mr. Scott. You mentioned Congress, what can Congress do if
there is a violation? How does it enforce the impoundment
violation?
Ms. Emmanuelli Perez. Well, Congress certainly, you know,
as part of its own legislative process with the oversight, as
well as with appropriations, you know, Congress has taken
actions before in either cutting the budgets of agencies or
identifying areas where they feel that an agency has to take
action. So, certainly, Congress through that oversight and
legislative process can do that.
Mr. Scott. If you have something that has been properly
authorized and appropriated, but depends on promulgation of
rules, and the executive branch just refuses to promulgate the
rules, what happens in that case?
Ms. Emmanuelli Perez. Well, it certainly would depend on
the particular facts, whatever law is authorizing it, what the
rules that are being required of the executive branch. So,
certainly, you know, we would be taking a look at whether there
are certain actions the agency has to take by law and
identifying if they have not done so. And, again, that could be
up to, you know, Congress to enforce that.
Mr. Scott. And can you say a word about violations that
happen during a government shutdown?
Ms. Emmanuelli Perez. Yes. With the government shutdowns,
one of the issues that we have seen and we have issued a number
of decisions on this in the past year and a half, is that
agencies may have often tried to really expand on the authority
that they would have to continue operation. So, under the
Antideficiency Act, it is very specific that only--the only
exceptions really are for constitutional duties, as well as for
emergency type situations. Not for regular operations or
ongoing operations of agencies.
So, we do have a couple of examples where agencies did go
beyond the Antideficiency Act. The other thing that we would
recommend would be really that Congress have more oversight,
you know, the ability to see how agencies are obligating funds
during shutdowns. So, in addition to understanding their plans
for shutdowns, that they would see what exactly they obligated,
what activities they carried out. And we think that would be
really helpful in terms of the oversight that GAO can assist
the Congress with.
Mr. Scott. And what can be done if--in these cases you have
an executive branch and a legislative branch, probably a
contentious split in the legislative branch, what can actually
be done if the executive agency just goes ahead and spends the
money?
Ms. Emmanuelli Perez. Well, if an agency, for example,
violates the Antideficiency Act, and if GAO, for example, finds
that the agency had violated the Antideficiency Act, then what
we have said is that the agency should report that violation to
Congress. And in reporting that violation to Congress, they are
going to provide information about the rationale for using the
funds, what actions they are taking with respect to ensuring it
doesn't recur, and any discipline or other action. So, we think
that having Congress ensure that those types of violations are
reported are really going to assist again in that transparency
and oversight.
Mr. Scott. Thank you, Mr. Chairman, and I yield back.
Chairman Yarmuth. The gentleman's time has expired, and I
yield five minutes to the gentleman from Iowa, Mr. Feenstra.
Mr. Feenstra. Thank you. Thank you, Mr. Chair, Chairman
Yarmuth and Ranking Member Smith. Thank you, Mr. Chair, for
having this hearing today. I want to thank each of the
witnesses for their testimony. I am new to Congress, but not
new to the government finance, especially when it comes to city
and state governments. I was a City Administrator and a State
Senator. And I am very cognizant of budgets. And in my home
state, we have specific rules that we do not spend more than we
take in. We have a 99 percent spending level. I have found very
little concern of this at the federal level.
Mr. Chairman, you said on the House floor that the national
debt will probably rise to about 50 trillion in the next couple
of decades. You mentioned several historical points where our
debt grew but did not mention that or in terms of debt to GDP,
and at that time our debt to GDP is about 50 percent. Well,
today, our debt to GDP is well over 100 percent and we are in
uncharted waters, which we just can't shrug off as we move
forward.
I am new here, but you don't have to be a Member of
Congress to see that we are piling up debt on this credit card
and it has consequences. Mark Paoletta, this question is for
you. The National Oceanic and Atmospheric Administration has
existed over 50 years without ever being codified into law. A
2016 CBO report highlighted that many federal agencies like the
State Department, HUD, and the National Weather Service haven't
been reauthorized in decades.
Just last year, the CBO released a report that found $332
billion of funding was provided to 407 expired authorizations.
It seems to me that there is a lot more ways than the
Impoundment Control Act for Congress to reclaim the power of
the purse. We could actually try to do our jobs and pass timely
legislation through regular order, rather than spending weeks
on messaging bills shouting our political talking pounds. I
have been digging into these reports and we aren't suffering
from a lack of things to do.
So, Mr. Paoletta, my question is you have worked both on
committee and at the OMB, do you believe that autopilot funding
and authorizing as needed in omnibus bills impacts how the
executive branch functions? And who benefits from this, the
executive or Congress?
Mr. Paoletta. Well, the people who don't benefit are the
American people. Congress needs to do their job and authorize
programs in clear and understandable terms as to how programs
are supposed to work. The fact that there are hundreds of
unauthorized programs, some as you said, the Department of
State is unauthorized, is outrageous. And passing omnibus
appropriations that throw massive amounts of money in a very
vague way, you know, that has the legislative branch
encroaching into the executive branch on how to implement it.
What Congress needs to do is to pass a budget, pass
appropriations bills on time, and that is the best way to make
our government work. That is as simple as it can be.
Mr. Feenstra. I agree. So, how did the train go off the
rails? I mean, how did this all begin and how do we get the
train back on the track?
Mr. Paoletta. My views in Congress is, you know, I am not
going to--it is in Congress' control as to pass their budgets,
to authorize their programs, and to pass appropriations bills
on time. I am not sure what the answer is. It is just I know
that the way it is run right now, and particularly having
worked in both branches and most recently in OMB, it is very
difficult as Congress does--and you see these--what is
interesting, Congressman, is the idea that there is going to be
this broad appropriation and then Congress is going to come in
on individual levels and tell the executive how to spend the
money. That is not their role, right? The law, what they pass
is what is important, and is the guiding light as to how you
are going to implement a program.
And just one more point, if I may. Just in terms of
transparency, it would be useful if FOIA was applied to
Congress, right? We all talk about the transparency of the
executive branch and, you know, looking, you know, sunlight
being the best disinfectant. It is outrageous, in my view, that
Congress is not subject to FOIA. GAO is not subject to FOIA.
So, what goes into lawmaking? One of the witnesses said, you
know, we pass a law, that is sunlight. No, what went into that
law as to why it was passed and what a member thinks it should
be, you know, doing when it is enacted. So, I think FOIA
applying to Congress would be a great way to actually help the
system work better.
Mr. Feenstra. I would agree. I would agree 100 percent.
Thank you, Mr. Paoletta, for your comments. Mr. Chair, I yield
back.
Chairman Yarmuth. I thank the gentleman. His time has
expired. I now recognize the gentlewoman from Iowa, Mrs.
Hinson, for five minutes. I think she was the first one to sign
on today, so, you have been very patient.
Mrs. Hinson. Thank you, Mr. Chairman. Can everyone hear me
OK? OK, thank you. Thank you for holding this hearing today. I
believe this is an incredibly important topic and I would like
to thank my colleague from Iowa for his comments on
unauthorized programs. It is very difficult for appropriators
and us here on the Budget Committee to do our job when Congress
is failing at doing its basic oversight, its basic job of
authorizing, and its basic job of appropriating.
So, I have only been in Congress a few short months and
already I am concerned about the lack of transparency and
fiscal responsibility that I have seen here in Washington. I
think it is incredibly important that Congress does reassert
its control over the power of the purse. I am a member of the
Appropriations Committee and the Budget Committee. And there is
a reason that the committee is required to include the
perspectives of appropriators because we do see those spending
decisions and authorizations from this Budget Committee all the
way out the door. I personally believe this is incredibly
important in advocating for the taxpayers of Iowa and this
country and fighting for transparency throughout this process.
So, my first question today is for Ms. Hempowicz. Simple
here that you have done a lot of work on transparency,
accountability, freedom of information. So, how does the impact
of administrative deferrals or recissions like what we have
seen with President Biden's redirecting of these border
security funds recently raise concerns about transparency in
this process?
Ms. Hempowicz. I think, you know, the fact that
apportionments are issued in secret, you know, raises a lot--it
makes it much difficult for--much more difficult for Congress
to fulfill its role as overseeing the spending process. You
know, Mr. Paoletta said how Congress passes the law and it is
the executive's job to implement it. But that is not the only
job of the executive. It is to implement that law with the
intent of Congress in mind. And when there is no transparency
here and when we have seen, as we have, that there is a lot of
room for flexibility for the executive to interpret things as
they would see fit, and in ways that maybe run counter to what
congressional intent was, there is a lot of room for
manipulation in this process. And I think transparency is one
of the things and certainly not the only thing but is one thing
that will dramatically rebalance power between the executive
and Congress.
Mrs. Hinson. And what do you think about the transparency
or the impact on transparency when an Administration fails to
notify Congress of what it is doing?
Ms. Hempowicz. Yes, I mean, again, it just goes to
Congress' decreased ability to conduct rigorous oversight over
the executive branch. Something that the Project On Government
Oversight believes is incredibly important no matter who is in
the White House. And the less transparency to Congress means
that it takes longer for you to do that oversight, for you to
get that information. Because eventually you will likely get
it, but in that time, you know, what have you missed?
It is also, I think, important to mention how, you know,
fighting with the executive branch to release information to
Congress takes up so much time of your staff. Your staff has so
many responsibilities to do and to execute in a given day. You
know, if there was transparency required in the law, proactive
transparency that will give you a lot of that information, you
can redirect your staff to more important things because you
have got access to those documents and now you are able to
fulfill your oversight function.
Mrs. Hinson. Right. Well, thank you for your feedback on
that issue. And then my next question is for Deputy Counsel
Perez. I know you are familiar with our Constitution so, as we
read the section that gives the executive branch authority to
spend funds, do they have the authority to spend funds for
purposes other than what Congress has appropriated?
Ms. Emmanuelli Perez. No, ma'am. The whole purpose there is
that with the purpose statute with the actual appropriations
themselves, the executive branch does have to follow what the
Congress has appropriated. Now, certainly, Congress sometimes
is much more specific in some cases in what the funds should be
spent for. There are times, of course, when Congress also has
provided the executive with some discretion. But the whole
intent is that the executive branch needs to follow the laws
that Congress has passed and that the President----
Mrs. Hinson. And I agree, legislative intent is crucial and
paramount here. So, you also talk about the Impoundment Control
Act in your testimony that it was enacted to stop executive
overreach. What do you consider to be executive overreach? What
is that threshold for you? And what actions are being taken to
prevent overreach for this current Administration in regards to
the border wall funding freeze?
Ms. Emmanuelli Perez. Well, with respect to the border wall
funding freeze, obviously, we have that decision that is
pending. We have not issued it yet. And we are, of course,
waiting for information. Part of what we did was immediately
start to contact the agencies when we learned of the
President's proclamation and, you know, to start to ask for
information. And then, of course, followed up with development
letters.
The whole purpose there of the Impoundment Control Act is
we need to look at that there is a process there in the
Impoundment Control Act, and the President has to follow that
process. That is to notify Congress with specific conditions
provided by the law and to not, for example, you know, propose
deferrals for policy reason and in the case of any policy
situation, the only process really is to propose a recission.
And so, what we look at there is what has the executive branch
carried out? We look at the rate of obligations. We look at
what, for example, in these cases, what has OMB instructed?
Those are all critical parts of that analysis.
Mrs. Hinson. OK, thank you, Ms. Perez. And, Mr. Chairman, I
would like to ask unanimous consent to submit our letter for
the record that House Appropriations Committee Republicans,
including myself, wrote today to Vice President Harris
requesting an update on the results of the funding pause. So, I
would seek unanimous consent to add that to the record today.
Chairman Yarmuth. Without objection, so ordered.
Mrs. Hinson. Thank you. I yield back.
[Letter submitted for the record follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Chairman Yarmuth. The gentlewoman's time has expired. I now
recognize Mr. Cline of Virginia for five minutes.
Mr. Cline. Thank you, Mr. Chairman. I appreciate you
holding this important hearing. The power to direct and control
federal spending is arguably Congress' most important
legislative tool. So, I am pleased that we are holding this
hearing regarding ways that we in Congress, and especially on
the Budget Committee, can restore and strengthen Congress'
power of the purse against executive branch overreach. This is
particularly timely since soon after taking office, President
Biden announced the withholding of funds for construction of
the southern border wall.
There are other issues at play on this topic, including how
Congress can create better legislation, rather than relying on
end of the year omnibus bills and continuing resolutions to
govern. So, I will ask Mr. Paoletta, Chairman Yarmuth's bill
from the last Congress, the congressional Power of the Purse
Act, modified GAO's role in matters regarding budget and
appropriations law. Do you have any thoughts about the section
of the congressional Power of the Purse Act that would make
administrative and possibly criminal consequences on federal
branch--federal employees in the executive branch who are found
to have violated the Impoundment Control Act?
Mr. Paoletta. Thanks for the question, Congressman. You
know, the problem with the Impoundment Control Act is that it
is a very confusing law. And so, I think that it puts federal
employees in a difficult position, right? You have the
Antideficiency Act that you can't spend more money than you
have. And if it is, you know, intentional, that would be
criminal, and--or, you know, possibly criminal.
And on the flipside, if you are not spending all your
funds, you could be--you could be in trouble with these
administrative sanctions. I think GAO proposed criminal
penalties for impounding funds. The problem with--the problem
with--so, I think it is a bad policy idea to impose sanctions
on individuals with respect to the Impoundment Control Act.
Mr. Cline. Thank you. I will ask Ms. Perez. Congress'
reliance on continuing resolutions and omnibus appropriations
is not an ideal way to effectively and efficiently budget and
govern. What are some of the GAO's findings with regard to this
negative effect of this type of governing? And further, what
impact do CRs have on agency budgets and their ability to
adequately plan?
Ms. Emmanuelli Perez. Yes, so, we have done work on looking
at the impact of continuing resolutions, you know, multiple
continuing resolutions during a year or actually having them,
you know, for a full--for a full year. And, certainly, what we
have found in our work and we are very happy to provide that
information for the record, is that there are impacts with
respect to having, you know, having to rework. So, for example,
multiple attempts to be able to, you know, implement grants or
to be able to award contracts because you have shorter periods
for the funding to be available.
We have seen delays in hiring, delays in other programs and
programs being implemented because with a continuing
resolution, one of the things, the prerogatives that Congress
has is really to kind of really put everything on hold that is
status quo. And so, agencies then have an impact on being able
to implement any new authorities. We have seen a number of
those issues in our work.
With respect to, you know, to looking at how, you know, how
that can be approved, we certainly have also seen issues with
the budget process when there is a continuing resolution. There
is an impact on the agencies as well in being able to plan out
their budgets and plan how they are going to implement. So, we
definitely have seen some negative impacts there.
Mr. Cline. Can you talk about the ways the GAO can measure
the amount of waste that is generated from government
shutdowns? Have you ever tried to quantify it and have you ever
produced a report related to government shutdowns and the
amount of waste that is--that are--that is produced?
Ms. Emmanuelli Perez. We have done work on government
shutdowns and looked at the impact of, you know, on shutdowns,
on agency programs. We have not actually, though, really come
up with any, you know, any estimate of the, you know, the
amounts that are used there and any possible waste. We do
understand that there may be other entities that have done
that, however. And we would be happy to look for that
information.
Mr. Cline. Thank you. Dr. Reynolds, you coauthored an
article in October 2020 that stated, strengthening
congressional committees could also help the legislative branch
pushback against the President's use of his budgetary power.
What are ways congressional committees could serve as an
effective check on the executive branch?
Dr. Reynolds. I thank you, Representative Cline. I think
there are all of the tools that are available to congressional
committees can be deployed in service of asserting Congress'
role in the separation of power. So, hearings like this one,
letters that can be sent looking for additional information.
Part of, again, what we are talking about today is the ability
to make that process work better for Congress, make it easier
for you all to get your information back. And the last thing I
will say is boosting the staffs on your committee. Making sure
that you have the ability to hire subject matter experts, to
compensate them well, to keep them in those roles in order to
make sure that your committees really have the expertise you
need to understand the federal programs that you are trying to
oversee in the executive branch.
Mr. Cline. Thank you. I appreciate the answers. Mr.
Chairman, I yield back.
Chairman Yarmuth. The gentleman's time has expired. I now
recognize another gentleman from Virginia, Mr. Good, for five
minutes.
Mr. Good. Thank you, Mr. Chairman, and thank you to all of
our guest witnesses. I appreciate your testimony that you
provided to us. And, you know, I share the concerns that have
already been mentioned by many colleagues about how the--our
legislative branch, our legislative body has surrendered so
much of our power and authority to the executive branch. You
know, constitutionally there is a reason why Article I comes
first and deals with the legislative branch. And it is the
largest portion of our Constitution deals with the legislative
branch as the founders intended that branch that is closest to
the people to be the most powerful, dominant branch.
And I quickly appreciate the remarks previously here today
by Congressman McClintock from California, what he shared, and
I would echo his remarks without being redundant and repeating
those.
I do have a question for Mr. Paoletta. In your testimony,
you noted that reforming the ICA--and I am quoting here--``to
return to a more equitable division of power between Congress
and the President with respect to the expenditure and
appropriated funds would allow prudent financial management to
flourish.'' Can you just speak a little further on what
recommendations you would have for reforming the ICA?
Mr. Paoletta. Well, I think it is not so much focused on
the ICA. I have written on the ICA in my opening statement, but
I think it is really just a return to regular order. It is
actually, you know, having well-written authorizations and
stand-alone appropriations that really lay out what Congress
wants so there isn't, you know, this broad, you know,
appropriation or an unauthorized program that continues on. So,
that is at the heart of it is what I think Congress needs to do
is authorize programs very clearly as to what they want the
executive to carry out and then pass appropriations to fund
those.
Mr. Good. Well, you did an effective job in your testimony
also of talking about how dysfunctional we are in the way that
we are handling our funding now and how we are--it is not
sustainable what we are doing. I do want to yield the balance
of my time out of respect to the Ranking Member because he ran
out of time and I know he had some more questions he wanted to
ask. So, I do yield the balance of my time to Ranking Member
Smith, thank you.
Mr. Smith. Thank you, Representative, for yielding. My
question, Ms. Hempowicz, you previously wrote an article about
pandemic spending which stated Congress must make sure that the
money is really going to protect jobs and keep workers safe.
That large corporations don't get loans that they don't truly
need. That crony capitalism doesn't influence who receives
assistance, and that fraudsters don't rip off taxpayers,
correct?
Ms. Hempowicz. Yes. Yes, Ranking Member.
Mr. Smith. To that end, I understand you and your
organization even published newsletters called, Corrupted, that
described instances of corruption, fraud, waste, and abuse
related to spending and other things during the pandemic?
Ms. Hempowicz. Yes, sir.
Mr. Smith. So, if you remember, when did you all begin
publishing those articles?
Ms. Hempowicz. I don't remember that.
Mr. Smith. I think it is like August 13th is--does that
sound about right?
Ms. Hempowicz. Sure.
Mr. Smith. OK. And do you know how often you all
distributed these articles?
Ms. Hempowicz. The Corrupted newsletter?
Mr. Smith. Yes.
Ms. Hempowicz. I believe it was weekly.
Mr. Smith. OK. And do you all still distribute these weekly
newsletters about your oversight efforts?
Ms. Hempowicz. Not that one in particular for our--the
content that had been in the Corrupted newsletter is now spread
between a couple different products. But we are certainly still
doing investigations and publishing reports on any waste,
fraud, and abuse that we are able to identify in COVID
spending.
Mr. Smith. So, when did you stop doing that weekly
newsletter?
Ms. Hempowicz. It was a couple months ago, I believe.
Mr. Smith. January 14th is what I saw. Does that sound
about right?
Ms. Hempowicz. Sure.
Mr. Smith. You know, given your previous statement that
Congress must make sure that money is really going to protect
jobs and keep workers safe and your organization's stated
commitment to oversee COVID-related spending, coupled with the
fact that President Biden and congressional Democrats recently
enacted 1.9 trillion in federal spending, why did you stop
publishing these weekly reports?
Ms. Hempowicz. Again, it was a strategic decision behind
the scenes to kind of make sure that we are using our resources
well. We are a small organization. We are still absolutely
publishing that content. You know, I think maybe you are
suggesting that we have stopped investigating COVID fraud, and
that is just absolutely not the case, sir.
Mr. Smith. So, would you say that this is not because there
is a different occupant in the White House?
Ms. Hempowicz. Absolutely not. And I would say even earlier
this week, our organization published a piece critical on the
Biden Administration in particular. Particularly on some
revolving door issues that may be affecting some of the
policymaking coming out of the White House.
Mr. Smith. You know, I think some waste that you all could
look into is some waste that I have been reading about and
discovered just in the last week that billionaires in Florida
received the $1,400 stimulus check. I think that's pretty
wasteful, wouldn't you think so?
Ms. Hempowicz. I would agree. And I would say, you know, a
lot of the oversight over COVID spending has been actually very
difficult. And the inspectors general have mentioned that too.
Partially because last year, the Office of Management and
Budget undercut some of the reporting requirements that were
included in the CARES Act that would have given the public and
the inspectors general and the internal watchdogs more detailed
information. You mentioned earlier jobs, particularly would
have given more detailed information about how those various
programs were reflecting in or not reflecting in increased
jobs.
And so, I would say, you know, part of it is, again, we are
a small organization. We don't have unlimited resources. We are
trying to make sure that we are using those resources as best
as we can. But we also did create a tracker. It is called--and
now I am forgetting the name, but I am sure it is on our
website--that tracks all the COVID spending. And I believe that
tracker is the most comprehensive tracker that we have that is
out there. You know more so than what the government has put
together. Because it is really important to us as an
organization that the public is able to track this spending.
And particularly, on the unemployment insurance that you
were mentioning, we don't have a lot of data about that. So, it
is more difficult to do those kinds of investigations. But I
certainly take your point and it is really important to us as
an organization. And so, I would encourage you to keep your eye
on our website because that is where that content is now, not
in that newsletter.
Mr. Smith. I didn't mention anything about unemployment
insurance. I was talking about stimulus checks----
Ms. Hempowicz. I'm sorry.
Mr. Smith.----that billionaires don't need.
Ms. Hempowicz. I'm sorry. I missed that.
Mr. Smith. So, that may have been someone else. But I
appreciate that you all----
Chairman Yarmuth. The gentleman's----
Mr. Smith.----continue to look at the waste in spending.
Ms. Hempowicz. Yes, of course.
Chairman Yarmuth. The gentleman from Virginia's time has
expired. I now recognize the gentlewoman from Texas, Ms.
Jackson Lee, for five minutes.
Ms. Jackson Lee. Mr. Chairman, thank you very much for this
hearing. And thank you for the earlier work. I remember when
you introduced the protecting of the purse and all of the
Democratic Members signed on to it and it is very commendable
that you are holding this hearing again in a different
Administration.
But we do know that the king of moving money around and
ignoring the needs that Congress dictated for their
appropriations to be used for certainly was the past
Administration. And I guess, as we all know, the greatest abuse
was the $391 million from Ukraine that was utilized as a
carrot, as a stick, as a brick against the President of Ukraine
in order to find out dirt on the family and/or present holder
of the Presidency of the United States.
I think it is important and as Members of Congress, we look
at this in a non-partisan manner to constitutionally protect
what our duties happen to be.
But let me add some additional affronts. And that is the
diminishing and the not using and not helping to support
different agencies that dealt with civil rights. Particularly,
the Civil Rights Division of the DOJ. The last Administration
was particularly prone to not want to have that kind of
appropriation going on. This was not precisely an
appropriation, but it was language in attempting to get
violence, gun violence as a national health issue. Thank
goodness we have a new day.
So, it can also be policy that may generate into the
Congress' decision on funding. So, I want to ask the question,
how diligent we should be under the Constitution to ensure that
some of the underbelly of the agencies, the subagencies like
the Office of Civil Rights, that we can also delve into and
find out whether or not there is a cutting, there is a non-
expenditure, there is sort of a smothering of these agencies
unbeknownst to Congress who has expended funding for them.
Why don't I start with the representative from the GAO to
answer that question, Mr. Perez. Is that Ms.?
Ms. Emmanuelli Perez. Yes, this is Ms. Perez, no problem.
Yes, absolutely. So, part of what we see, which is in the power
of the purse bill that had been, you know, presented in the
last session that we would continue to recommend is really
having agencies not only have OMB publish the apportionments so
that we have information specifically on those accounts in that
real time basis, but also having agencies report on their
obligations with respect to shutdowns, report on their expiring
and canceled appropriations, because that would really give
Congress and GAO as well as other watchdogs, the ability to
look at what is occurring really with sort of that lifespan of
the appropriations as Congress has set out. So, these are the
types of information that we think would be helpful to Congress
in being able to conduct its oversight.
Ms. Jackson Lee. Thank you. I am going to ask this last
question to both Ms. Hempowicz and Ms. Reynolds. How important
is it and, Ms. Perez, indicated that we need to do the subset,
the subagencies, if you will, because I think that is where
havoc can really be activated. How important is it for
Congress' due diligence, but more importantly, for the vision
and/or the right running of Congress that all of these agencies
that are not well-known that are doing lifesaving actions, are
dealing with civil rights, are dealing with civil liberties,
protecting the LGBTQ community, how important is it for
Congress to dig into how moneys are obstructed or not used for
those purposes? Ms. Hempowicz?
Ms. Hempowicz. It is incredibly important. I mean, you
know, I can't really expound on that. It is just so critical.
It is so critical that when Congress appropriates money, the
executive branch spends it as Congress intended. And so, to do
that to make sure that is happening, you need transparency to
make sure that--to facilitate your oversight.
Ms. Jackson Lee. And I would add the religious community as
well and protecting them. Ms. Reynolds?
Dr. Reynolds. The only thing I will add is that part of why
it is so important is because there can be divergence between
what Congress asks for and what the executive branch does for
reasons from nefarious to routine. And you need good
information to be able to figure out all of those things
because, again, the potential here for gaps is inevitable. And
that is part of why it is so important that you get the
information you need to make good decisions.
Ms. Jackson Lee. Thank you very much. Mr. Chairman. I think
my time has expended and thank you for this hearing. I yield
back.
Chairman Yarmuth. Thank you, Ms. Jackson Lee. Your time has
expired. I now recognize the gentleman from Wisconsin, Mr.
Grothman, for five minutes.
Mr. Grothman. Just a general question. Could anybody give
me a suggestion as to how we can better improve identifying
areas that we feel are wasteful or lead us to, really, I think
the biggest problem we have here, reduce overall spending?
Ms. Hempowicz. I can jump in with a suggestion. I would--
and this might be surprising--but I would consider, you know,
raising staff pay. I think one area where--one of the reasons
why Congress is suffering here is because congressional staff,
you know, there is just I think it is called brain drain. There
is such high turnover that you don't have oftentimes the
expertise your staff needs to be to be doing these programs
effectively. And so, that would be my suggestion.
Mr. Grothman. Go ahead, I'm sorry. Go ahead.
Ms. Emmanuelli Perez. Oh, I'm sorry, sir. And if I could,
from GAO's perspective, we certainly have the work that we do
annually on the duplication overlap and fragmentation, as well
as really just generally all of our work looking at, you know,
fraud, waste, and abuse. In addition, we have got the high-risk
series and just a number of other areas. So, we certainly would
urge you to, you know, work with GAO to help you identify any
of those subjects.
Mr. Grothman. Nobody could argue that right now Congress is
not overspending substantially. Obviously, things have gotten
worse since we got rid of the sequester. Could you give a crack
at whether that was a big mistake or not?
Ms. Emmanuelli Perez. Well, we certainly did some work as
well looking at sequestration and the effect. And one of the
things that we did find is because sequestration is an across
the board cut, it is difficult then for agencies to be able to,
you know, adjust to it and to be able to react to it because
they are not able to identify or prioritize what Congress may
want them to do, as well as agencies' programs are. So, in that
sense, while it may be effective for some cutting spending, it
does have an across the board impact which does make it
difficult to prioritize.
Mr. Grothman. Anyone else want to take a crack at that. I
am not sure I buy it, but.
Mr. Paoletta. I could take a crack at how to spend less
money. You know, the Impoundment Control Act, from my
perspective, Congressman, as I said, it disincentivizes. It
actually makes it illegal to try and save money, in my opinion,
right? If you get $100 billion, and you can do the program for
$70 million, you get that $30 million. And if you put a pause
on it, you deferred those funds to make it a better-run
program, and you have those $30 million left over, you have to
spend those funds by the end of the period of availability,
unless you send it up for recission, and those never get
passed. So, there is no incentive to do a program to make it
better, to do it cheaper because that money has to be spent,
per the ICA, by the end of the year.
In the old days, if you did it and got it done, and you had
money left over, so long as you accomplished the purposes of
that program, it could lapse. Whenever you try and save money,
the ICA makes it illegal. So, there is no incentive to save
money running federal programs.
Mr. Grothman. Why won't we reinstate it?
Mr. Paoletta. Well, that is what the ICA does right now,
sir. And so, my view is one of the tools could be if you can
run a program for less money, those funds should lapse. And if
Congress wants to reappropriate it after it lapses with some
fast track, they can do that. But I think the ICA as written
right now is a terrible law.
Mr. Grothman. OK.
Ms. Emmanuelli Perez. So, we would disagree with that
because in the sense, the ICA does permit you to propose those
for recissions. And we do have statistics that show how
Congress enacts recissions, as well as, you know, historically
how Congress would also enact recissions that were proposed by
the Administration. So, we do feel that that act does have the
opportunity for the executive branch to identify that type of
situation.
Mr. Grothman. OK, thank you. I give it back to the
Chairman.
Chairman Yarmuth. I thank the gentleman. His time has
expired. And I now yield myself 10 minutes for questioning. And
I am going to begin by yielding to the gentleman from North
Carolina for questions, Mr. Price.
Mr. Price. Well, thank you, Mr. Chairman. Since we are not
going to have another round, I want to just suggest a question
that our witnesses could usefully explore for the record. And
that has to--but I think we must raise it. And that is the--I
don't know if Mr. McClintock is still on the call, is he? But
he raised questions suggesting that congressional projects or
earmarks were somehow constitutionally infirm, constitutionally
questionable. And I just think we have to get a response on
that from our witnesses for the record.
My view has always--I was stunned by that. My view has
always been that the constitutional argument ran in the other
direction, that there was something very questionable about
this kind of arbitrary denial of the power of the purse. I
don't imagine that earmarking is constitutionally required, but
I certainly can't imagine that it is constitutionally denied.
Mr. McClintock said that Congress appropriates and the
executive branch spends. Well, an earmark or a congressionally
directed appropriation is an appropriation. It is just a more
precise and more specific kind of appropriation. And the
executive agency, of course, still executes that project.
So, I just think we need to clear that up because we are
embarking on this and I view it as a reclaiming of the power of
the purse and, therefore, a very positive affirmative act. And
I am glad that both parties in the House, the majorities of
both parties in the House, have agreed with that. But if we
could ask our witnesses to submit some kind of commentary on
that for the record, I think it would be very useful.
Chairman Yarmuth. We would be happy to do that. I thank the
gentleman.
So, reclaiming my time, I want to mention I have been
informed by counsel just in relation to the last exchange with
Mr. Paoletta, that the Impoundment Control Act specifically
allows for deferrals to achieve savings through greater
efficiency of operations. So, there is an opportunity to do
that under current law and ICA law.
So, I want to respond to a couple of things because one of
them just doesn't pass the BS test in my opinion. And that is
the claim that the Ranking Member made and I think Mr. Paoletta
made also, that the impoundment of refusal to spend $1.4
billion on the border wall had somehow exacerbated or caused
the current situation at the border. And the notion that in 100
days that that 1.4 billion could have been spent and to in any
way affect the flow of people who are trying to enter the
country is just absurd. I am sorry, that is just crazy.
I am not defending what the Administration does and GAO
will have a response to us again in a short period of time as
to the legality of what he did. But the idea that that is
somehow connected to the situation at the border is really
ridiculous.
And I do want to respond also to Mr. Feenstra. I don't
think he is with us any longer, but, you know, when you compare
what a state government's fiscal constraints are or a local
government or a business or a household, as many people always
do, it is not a valid comparison to the federal government. The
federal government is the issuer of currency. All of those
other either corporations or government entities, are users of
currency. They cannot create dollars. The U.S. Government can
and does, and we do it every day. And the idea that somehow,
you know, the constant refrain is that we are piling debt on
the future generations, I have said this many times before, we
have been accumulating debt in this country for 230 years. Not
one person has ever been asked to pay up. Not one person.
And when the national debt reached $1 billion under Abraham
Lincoln, I am sure a lot of people were saying that same thing.
When it reached $1 trillion under Ronald Reagan, I know there
were people saying the same thing because I was around then.
But the fact is that what many people refer to as debt is an
accounting device. It represents all of the money that the
federal government has injected into this country over its
history minus the taxes. And when we talk about debt as a
percentage of GDP, I think many, many economists now are saying
that is the wrong measure. It doesn't mean anything. And I
think you will get agreement from that from the Federal Reserve
Chairman and many others.
Japan's GDP ratio, debt to GDP ratio, is 240. Japan has
very low interest rates. They have 0 percent interest rates and
so they pay on their securities they issue. Zero interest rate.
They have very little inflation. And their currency is stable.
So, again, we throw around all of these things that kind of
we have been living with for the last 50 or 60 years these
notions that really don't reflect the way the federal money
supply works, and how the federal debt in emphasis what they
mean. So, I throw that out. We can have a hearing on that at
some time. I actually intend to do that.
I do have a question for Ms. Emmanuelli Perez. In your
testimony you recommended that Congress require that OMB
publicly post all apportionments of executive branch
appropriations. You also noted that many of GAO's inquiries
into potential violations of the Impoundment Control Act
include requesting the relevant apportionment documents. Can
you explain why a greater apportionment transparency would be
beneficial for GAO, Congress, and the public?
Ms. Emmanuelli Perez. Absolutely, sir. So, in order to have
the information to provide you and the Congress, with timely
decisions, we need to have timely access to information. So,
having those apportionments available publicly means that as
they are being published, as they are being carried out, we can
have access to that information. We can be looking at programs
as things are coming to our attention or with respect to any
other work we are doing. So, it definitely gives us the
opportunity to give you more timely advice, to give you timely
decisions in other work that we do.
Chairman Yarmuth. And so, you would have a much easier time
of flagging potential problems with potential violations in the
law. We would have a much easier----
Ms. Emmanuelli Perez. Yes.
Chairman Yarmuth.----time doing oversight of the money that
we appropriate.
Ms. Emmanuelli Perez. Yes, absolutely because if we look at
an apportionment and we see something that seems to be
anomalous, then we can question it right away. We can say this
seems different. We can compare it to prior years. That is one
of the key things you can do in looking at the Impoundment
Control Act issues is look at the prior rate of obligations.
See how the program was working in prior years. So, that again,
having that information up front is going to help us identify
potential problems.
Chairman Yarmuth. Thank you. Now, Mr. Paoletta said
something which I think is very true and that is that Congress
doesn't do a very good job of specifying what we want when we
allocate money a lot of the times. For instance, and I don't
know if this the case, but I don't have any idea how the
language of the law is read. I don't know whether it said new
law, whether it said replacement. I don't know. You may know,
Mr. Paoletta. And I am not trying to say that is justification
for anything because it is clearly true that, you know, we
don't always write the laws in the best way. We do try to have
report language that clarifies some of those more detailed
intentions when we know them. So, I think that your advice to
Congress to be very--as clear as we can be as to how the
executive branch is supposed to implement those policies is
well taken and considered. So, I appreciate that.
Mr. Paoletta. Thanks, Chairman.
Chairman Yarmuth. I am going to--no, go ahead and talk to
it.
Mr. Paoletta. No, thank you, sir, for that. Thank you.
Chairman Yarmuth. You are welcome. You are welcome to
respond, yes. But I have no other questions and I have vented
already enough. So, I am going to thank the witnesses for their
testimony, their responses. I thank the Members for their
questions.
And once again, I will reiterate to the Ranking Member and
every other member that the next hearing of the Budget
Committee on the Budget Committee, I will be--for that hearing,
I will be in the budget room. Mr. Smith, I will join you there
and anyone else who wants to join us. You are absolutely right.
We have equipped the hearing room so that we can hold hybrid
hearings in a much better way than we could have in the
beginning of the pandemic. So, we will do that.
Mr. Smith. Thank you, Mr. Chairman.
Chairman Yarmuth. And with that, if there is no further
business before the Committee, this hearing is adjourned.
Oh, Mr. Carter showed up. Wait a minute.
Mr. Carter. I am sorry, Mr. Chairman. That is OK.
Chairman Yarmuth. OK, sorry. We will give you a little
extra time next time.
Mr. Carter. Well, I am just glad I have got something I can
hold over your head, and don't worry, I will do it.
Chairman Yarmuth. Thank you all. And once again, thanks to
all the witnesses. The meeting is adjourned.
[Whereupon, at 3:30 p.m., the Committee was adjourned.]
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