WASHINGTON, DC - SEPTEMBER 12: A sign stand outside the U.S. State Department September 12, 2012 in Washington, DC. U.S. Ambassador to Libya J. Christopher Stevens and three other Americans were killed in an attack on the U.S. Consulate in Benghazi, Libya. (Photo by Alex Wong/Getty Images)
The White House is Trying to Circumvent Congress to Strip Funding for Diplomacy and Development
The White House is seeking to circumvent Congress to enact sweeping budget cuts on programs that support global development, diplomacy and the United Nations. On August third, the White House Office of Budget and Management ordered the State Department and United States Agency for International Development, USAID, to freeze spending on several programs. The ostensible justification for this freeze was to enable the Office of Management and Budget to review unspent funds from eight accounts that support diplomacy and development efforts, including the account that funds UN Peacekeeping and global health programs. But the reality is more likely that the White House wants to prevent appropriated funds from being spent before the end of the fiscal year on September 30.
These budget cancellations, or “rescissions,” are of dubious legality–but that is not stopping the White House.
The White House appears to be readying what is known as a rescission — a move by which the White House can prevent unspent funds from being disbursed. Under a 1974 budget law, the White House can, in some circumstances freeze the disbursement funds that were appropriated by Congress, but have not yet been spent. Congress then has 45 days to act on this rescission request. If Congress rejects the request, the funds would be unfrozen and able to be obligated. If Congress ignores the request, the funds would then be unfrozen at the end of the 45-day period.
But here is the rub: In this case, the funds that the OMB are targeting at USAID and the State Department are all set to expire at the end of the fiscal year, on September 30. If the money is not spent by then, it would revert back to the treasury. But Congress is currently in recess for the next five weeks, so should the rescission request be formally sent, Congress would have very little time to consider this request before the end of the fiscal year.
In other words, the White House is trying to run out the clock to prevent funds that Congress already appropriated for development, global health diplomacy and the United Nations from being spent.
The White House tried this last year, but was slapped down by Congress. Secretary of State Mike Pompeo also intervened to prevent the rescissions from being formally enacted. The White House eventually abandoned the effort. Months later, the US Government Accountability Office ruled that strategically timed rescissions intended to beat the clock on previously appropriated funds did not comport with the 1974 budget law.
That ruling has apparently not stopped the White House from trying this procedural and budgetary legerdemain again. Deeper still, the letter from OMB to USAID ordering a spending freeze occurred when the Secretary of State was out of DC, in a trip to the Asia-Pacific region.
The United States Global Leadership Coalition, which is a collection of businesses and non-profits that advocate for American support for international development estimates that rescissions would impact between $2 billion and $4 billion worth of unspent funds.
“OMB appears set on taking a sledgehammer to one of the most miniscule parts of the entire federal budget that would significantly damage America’s security and economic interests – and thwart congressional authority,” U.S. Global Leadership Coalition President and CEO Liz Schrayer said in an emailed statement. She added, “These cuts could affect key Administration initiatives from the Indo-Pacific region to Prosper Africa to the response to Venezuela to women’s economic empowerment. Other congressional priorities that could be hit include global health, countering Russian aggression, and peacekeeping operations.”
As of now, the funds are temporarily frozen pending the review request from the Office of Management and Budget. Whether or not this leads to a full rescission notification to Congress depends largely on internal jockeying within the Trump administration and whether or not the State Department can convince the White House to reconsider.