My name is Dr. Martin A. Regalia, and I am Vice President and Chief Economist of the U.S. Chamber of Commerce. The U.S. Chamber is the world’s largest business federation, representing more than three million businesses and organizations of every size, sector and region. This breadth of membership places the Chamber in a unique position to speak for the business community. Mr. Chairman, we appreciate this opportunity to appear before this committee in support of an amendment to the Constitution conferring line-item veto power on the President of the United States. We commend you for holding these hearings.

In 1996, the Line Item Veto Act was enacted, with strong bipartisan support. It granted the President authority to eliminate or reduce specific appropriations in legislation that he considered wasteful. The act went into effect in 1997, but was invalidated by the Supreme Court on the grounds that it violated the Presentment Clause of the Constitution by empowering the President unilaterally to repeal or amend provisions of duly enacted bills. That decision left Congress with the alternative of proposing a Constitutional amendment to achieve this end.

On January 27, 1999, Representatives Phil English and John Baldacci introduced legislation to establish such a Constitutional amendment. As the U.S. Chamber of Commerce expressed its support of the Line Item Veto Act in prior testimony, we support this current effort to resurrect it in a form that will withstand judicial scrutiny. Most of the rationale for supporting it in the past is still valid today, and just as compelling. One fundamental difference is that today we are enjoying record budget surpluses fueled by robust economic growth, rather than operating under the specter of debilitating budget deficits. However, without additional methods to control government spending we may find ourselves once again back in those high deficit days.

One thing that hasn’t changed is the vital need to cut government waste. There is no valid justification for the extent of "pork barrel" provisions that have gained Congressional approval over the years. Just as some legislative measures that could not hope to stand alone and survive public scrutiny are given shelter by being hidden within the minutiae of our federal tax code, many equally unmeritorious provisions are concealed within the heft of appropriation bills and omnibus spending packages.

During its short life, the Line Item Veto Act was invoked 82 times before it was finally held to be invalid. We believe that it is, therefore, necessary that the President again be given line-item veto discretion, albeit this time through the vehicle of a Constitutional amendment. The President should be given the authority to identify and carve out offensive and irresponsible spending that is discovered in legislation submitted for his signature.

There is evidence that suggests that our Founding Fathers – the Framers of the Constitution – intended that the President have the power to strike specific items of expenditures from spending legislation. Clause 3 of article I, section 7, of the U.S. Constitution duplicates the language of the earlier-enacted Massachusetts Constitution, under which its governor enjoyed the right to veto or reduce spending by line-item. Debate between Federalists and anti-Federalists made reference to line-item veto and power to revise appropriation bills that both sides believed to be embodied in the proposed document. While the authors of the Constitution did not expressly mention such power in its language, the Congress and the President can remedy that oversight with Mr. English’s and Balducci’s proposal, and make the Constitution’s intent concrete.

Currently, Constitutions in 43 States provide some form of line-item veto that allows the Governor to eliminate discrete provisions in legislation presented for signature. Of present and former governors who responded to one survey, over 90 percent considered the line-item veto as a useful tool for balancing the budget, and believed that it would help the President curtail federal spending. Several Presidents have requested that Congress expressly grant them this power. The President, representing broader constituencies than individual Members of Congress, will be more willing to oppose special interest spending inserted in appropriation bills by powerful legislators or narrow coalitions.

The American people have a vested interest in seeing the federal government practice fiscal responsibility. Wasteful spending programs result in unnecessary expenditures of our tax dollars, higher taxes, bigger government, and an impediment to paying down our national debt. These funds could be put to far better use by lowering taxes, reducing the national debt, and/or investing in needed infrastructure.

Some say that line-item veto authority could actually encourage higher spending. They fear that Congress may stuff the budget with even more pork, relying on the President to use the line-item veto to cull out the particularly offensive spending. Some of these extra expenditures would, no doubt, get through. While these fears may or may not be unfounded, we feel that vigilant use of a line-item veto would be able to effectively address this threat. Furthermore, for the very reason that legislators often attach non-germane spending items to legislation under the current system, a line-item veto is necessary. Often, a President may be reluctant to veto a spending bill, and throw out the baby with the bath water – the good with the bad. Thus, the additional spending gets approved. Creating needed flexibility through a line-item veto will enhance our system of checks and balances, and permit the President to avert these types of situations.

In the alternative, we feel that the line-item veto power would serve as a deterrent, rather than an incentive to attach more pork to spending bills and overload the system. Exercise of the line-item veto would highlight ill-advised spending measures for the world to see, reject them and return them to Congress with the challenge to justify them and attempt to pass them, if their proponents can muster the votes necessary to pass them on their own merits. The process would draw public scrutiny to the hi-jinks of Members of Congress who irresponsibly exercise their legislative powers or to rejection by the President of measures that resonate favorably with the American people. Adverse attention would be focused on those who do wrong, as well as those who do right, and would help educate our citizens about what is going on in Washington.

An excellent example of the glaring need for this amendment is provided by the Fiscal Year 1999 Omnibus Appropriations Act. This legislation was absolutely rife with pork barrel provisions. However, because of its massive size, Members of Congress did not have the time to consider each of the bill’s measures thoroughly. If Congress is unable to exercise the willpower or wherewithal to keep itself on a "pork-free" diet, we must license the President as its nutritionist, to help Congress get it done, for the health of America.

A line-item veto is a necessary fiscal tool to reign in excessive spending. It allows for differentiation among programs. The Chamber believes that effective budget cutting requires the ability to establish priorities, evaluate all spending measures and excise waste. By giving the President the discretion to cut specific items, we will avoid sacrificing worthwhile programs at the expense of questionable spending initiatives.