Mr. Chairman, members of the subcommittee, thank you for the opportunity to testify today. My name is Thomas A. Schatz. I am president of Citizens Against Government Waste (CAGW), a 600,000 member nonprofit organization dedicated to eliminating waste, fraud and abuse in government. Citizens Against Government Waste has not received at any time any federal grant and we do not wish to receive any in the future.

CAGW was created 16 years ago after Peter Grace presented to President Ronald Reagan 2,478 findings and recommendations of the Grace Commission (formally known as the President's Private Sector Survey on Cost Control). These recommendations provided a blueprint for a more efficient, effective and smaller government.

Since 1984, the implementation of Grace Commission recommendations has helped save taxpayers more than $625.4 billion. CAGW has been working tirelessly to carry out the Grace Commission's mission to eliminate government waste.

CAGW maintains that the adoption of a constitutional amendment granting the power of a line-item veto to the president is critical to establish fiscal discipline in Washington.

In recent years, Congress has appropriated tens of billions of dollars for projects that were not competitively awarded, authorized, or subject to congressional hearings or debate. This subversion of the budget process has meant that the interests of taxpayers in an economic, efficient and accountable government have been cast aside in favor of private interests.

For a brief period, the American people had hope that reform would reduce this assault on their wallets. In 1995, the new majority passed the line-item veto law by a voice vote in the House and an overwhelming 69-31 vote in the Senate. Clearly, Congress recognized the necessity of fiscal responsibility.

On January 1, 1997, the line-item veto law took effect. This law was enacted after decades of attempts to provide this power to the president. But this new veto privilege was used sparingly (some would say very selectively) by President Bill Clinton to cancel

a mere $355 million in fiscal year 1998 pork-barrel spending, less than .002 percent of that year’s budget. Although the amount of waste that was removed was miniscule, members of Congress who had previously lauded the passage of the line-item veto began to question its legitimacy. This was clear evidence that even though the overall amount of money saved was relatively small, eliminating more waste would have had a substantial effect on the spending culture.

Unfortunately, the Supreme Court took the line-item veto power away from the president in mid-1998, ruling the law unconstitutional. The clearest answer to the Supreme Court’s decision is a constitutional amendment granting the line-item veto to the president. Such power would allow the president to reject wasteful spending slipped into appropriations bills for narrow interests without having to veto the entire bill, shut down federal agencies or disrupt major federal programs. The power to veto and reduce line items in spending bills would enable the president to remove pork and fat from the budget without disturbing the normal flow of government.

The need for such power arises from weakened fiscal discipline promulgated by congressional budget practices and the Budget and Impoundment Control Act of 1974. Congress funds all executive agencies and departments through 13 major appropriations bills. As a consequence, the president cannot block a specific project without vetoing the entire bill. He must either let the spending go through or risk disrupting major programs and shutting down whole departments. Presidents seldom choose to exercise the veto in such circumstances and, as a result, pork and other wasteful spending items are not excised.

Congress has confronted the president repeatedly with hastily-crafted, 11th-hour omnibus bills that cover all or substantial portions of federal spending for the year. This practice inhibits the exercise of the veto, which under such circumstances would have the effect of closing down the federal government. A line-item veto would enhance the president's role in the budget process. It would not tilt the power over the nation's purse strings in favor of the president, but restore the balance that has been eroded by Congress' budget rules that favor big spending and pork. As it does in 43 states, it would make both the legislative and executive branches more accountable for our tax dollars.

A line-item veto amendment is necessary because under current law, the president's rescission proposals can easily be ignored. It is an affront to common sense that while the president now can propose to rescind any portion of an appropriations bill, Congress is not required to vote on his rescission package. If Congress chooses to ignore the president's request, it expires after 45 days. The spending proposals stand as law.

Mr. Chairman, that is the problem. For too long, pork-barrel and non-essential spending have been allowed to continue without checks and balances. The interests of taxpayers have been ignored, and the country endured more than a quarter century of chronic deficit spending that resulted in a national debt of more than $5.7 trillion.

Under the amendment, the vetoed items would be automatically stricken from the spending or taxing bills unless a two-thirds of the House and the Senate vote to override the veto. By giving the president a bigger presence in the spending decisions of our nation's government, fiscally sound legislation and not special interests should be the order of the day.

Concern that the line-item veto would give the president unlimited power is unfounded. The fear that the president could use the veto authority to expand his power exponentially and upset the checks and balances between the branches is addressed by restricting the president's veto power to disapproving specific line-items in appropriations bills. In this way, the line-item veto would not give authority to the president to alter the budget priorities set by Congress in its spending decisions, since the veto can only be used to withhold funds for an item.

Only in Washington, where many members of Congress see pork as a benefit to their own re-election, can an increase in accountability like the line-item veto be seen as a mortal threat to our republic.

By including provisions whereby Congress can overturn a line-item veto by a two-thirds vote, the separation of powers, the cornerstone of our republican government, is not overturned. Furthermore, it would be perilous for a president to use the authority to blackmail Congress into passing presidential pork because Congress could claim the high ground and ensure that the president’s pork was removed. Presidential and congressional pork is equally objectionable.

Over the past decade, CAGW's annual Pig Book has identified thousands of examples of egregious pork-barrel spending that cost the taxpayers an average of $10 billion every year. Examples include:

$58 million to bail out millionaire New York Yankee owner George Steinbrenner's American Ship Building Company in Tampa,;

$25 million for an Arctic region super computer at the University of Alaska to study how to trap energy from the aurora borealis;

$6.15 million for the Western Human Nutrition Center in;

 

$3.354 million for shrimp aquaculture;

$12.5 million for the East/West Center in Hawaii;

$1.5 million for the Million Solar Roofs Inititative;

$1.3 million for the National Wind Technology Center;

$19.6 million for the International Fund for Ireland;

$5.1 million in wood utilization research;

$250,000 for KNBA radio in Anchorage, Alaska;

$2 million for the Guadalupe Center in Kansas City for its culinary and cultural arts expansion;

$2.4 million for design and construction of a parking facility to provide 200 parking spaces for 18 federal employees in Burlington, Iowa;

$600,000 to ease fish migration up the Sacramento River;

$200,000 for a Toledo Mud Hens transit center study in Ohio;

$1 million for the Animal Waste Management Consortium through the University of Missouri; and

$750,000 for grasshopper research in Alaska.

For a generation, balancing the budget was beyond the ability of our leaders in Washington. Ironically, it appears that the budget deficit actually restrained pork barrel spending. Now that the American people are being overcharged and the Treasury is bulging at the seams, pork has exploded throughout the budget. There were 2,838 pork barrel projects in the fiscal 1999 budget. That was an increase of 32 percent over fiscal 1998. CAGW’s research team is working overtime counting the number of pork projects in the fiscal 2000 budget. Our list is just about complete, and it is clear that Congress has set a new pork-barrel spending record.

For decades, the opportunities for reducing wasteful government programs and reducing the size of government have been scarce. A line-item veto can provide opportunities for Congress and the president to work closely for a smaller, more efficient and less costly government.

The General Accounting Office, Congress' own investigative agency, estimated in 1992 that a presidential line-item veto could have cut $70.7 billion in pork-barrel spending from fiscal years 1984 through 1989. That's $70.7 billion in unnecessary spending taken out of the hands of the private sector.

The line-item veto would help restore citizen control over the political process. This, in turn, would promote fiscal soundness, efficient government, and policies favorable to continued economic growth.

Mr. Chairman, the line-item veto would allow the president to weigh parochial expenditures which benefit the few against the common good and the priorities of the many. The American people have demanded that it is time to change the way business is done in Washington. Voters are tired of finger pointing and excuses. Giving the president a line-item veto and ending the sovereignty of pork-barrel spending is just what they have in mind.

Successive presidents have asked Congress to provide them with the line-item veto. The president must have no excuses for failing to lead and accept accountability. Congress must show that it is serious about controlling spending by passing an amendment to the Constitution giving the president the line-item veto. The time is now.

This concludes my testimony. I'll be glad to answer any questions you may have.