Fact check: Presidential spending through executive orders is possible

Ella Lee, USA TODAY
·8 min read

Claim: A president cannot spend taxpayer dollars by executive order

With Congress in gridlock over a second stimulus bill to provide coronavirus relief, President Donald Trump issued four executive actions Aug. 8. Shortly after, critics took to social media questioning the actions’ legality.

One of those critics was former Secretary of Labor Robert Reich, who tweeted his take on the actions a day after the news was announced. “Your reminder that a president cannot spend taxpayer dollars by executive order,” the tweet read. Reich later shared the same post on his Facebook with the caption, “That’s not how this works.”

Lawmakers on both sides of the aisle criticized Trump's move, as well. Sen. Ben Sasse, R-Neb., called the orders “unconstitutional slop,” and House Speaker Nancy Pelosi, D-Calif., called them “illusions” that don’t “even accomplish what he sets out to do.”

Reich did not respond to USA TODAY’s request for comment.

More: Another coronavirus stimulus check: What we know about the next round of payments

Constitution gives power of the purse to Congress

The U.S. Constitution grants Congress the country’s spending power. David Super, a constitutional law expert teaching at Georgetown University, said that means the president cannot spend money without congressional authorization, "whether by executive order or presidential memorandum or anything else."

However, Congress can provide money that is contingent on the president releasing it, in which case, an executive order could release funds, if that’s what Congress called for, he said.

“Congress could pass a law saying, ‘Give this money to the farmers in Iowa’ in which case the farmers get the money. Or Congress could say, ‘Give this money to the farmers in Iowa, if you find they need it,’” Super said. “In that case, the money wouldn't go out unless and until the president made a finding that it was needed, and if he did make that finding, then it would go out.”

More: The top 3 unanswered questions about Trump's executive orders on coronavirus relief

In “Presidential Spending Discretion and Congressional Controls,” constitutional expert Louis Fisher breaks down several examples of presidents exercising the power to decide what money goes where with contingency funds, sometimes in ways that weren’t appropriated by Congress.

In 1961, for example, President John F. Kennedy issued an executive order establishing the Peace Corps. The agency wasn’t appropriated funding until seven months later, but in the meantime, Kennedy financed the corps by using over a million dollars in contingency funds from the Mutual Security Act.

Congress has moved before to curb abuse of contingency funds by the executive branch. Fisher wrote that in 1959, a subcommittee in the House specifically denied funding for an Incentive Investment Program proposed by the executive administration. That denial was omitted from the final appropriation bill passed by Congress, and the president used his contingency fund to start the program anyways.

The House Appropriations Committee claimed that the president was using the contingency fund to override the actions of Congress, so in a later bill, it was written that no funds appropriated for the president’s contingency fund “shall be used for any project or activity for which an estimate has been submitted to Congress and which estimate has been rejected.”

Generally, presidents are not allowed to shuffle around contingency funds, Super said. If a president decided he wanted to move money from our imaginary contingency fund for Iowa farmers and give it to Texas health care workers, that wouldn’t be allowed.

But the lines have been blurred before; it happened recently with the funding for Trump’s border wall.

More: Supreme Court won’t halt challenged border wall projects

“Congress, in various defense and national security statutes, has given the president a fair amount of authority to shift things around,” Super said. “There is fairly broad authority, specifically in the national security statutes, to allow responding to fast changing war conditions, and (Trump) used that to build a border wall, which isn't really a military thing, and that's why there's been litigation about that. I think people have the notion the president can push things around because of that.”

John Hudak, a senior fellow in governance studies at the Brookings Institution, told AFP's fact checking team a similar story when addressing the claim that U.S. presidents cannot spend taxpayer money with executive orders.

“A blanket statement like that is incorrect,” he told AFP. “It is not typically common that funds are spent at the direction of an executive order,” but “there is not a blanket prohibition on that behavior.”

Trump’s recent executive actions and whether they’ll be challenged

While none of the executive actions hold much weight, Super said the unemployment memorandum is “the one that really matters,” as it’s the only executive action of the four clearly trying to spend funds in a way Congress had not anticipated or appropriated.

That memo allows for states to provide up to $400 per week in expanded unemployment benefits, 75% of which would be moved from the federal government’s federal disaster relief fund and 25% of which is expected to come out of the states’ pockets.

More: 'An administrative nightmare': Trump's executive action is a scramble for unemployment aid

Although there is partisan debate over the legality of the action, Treasury Secretary Steve Mnunchin said all four executive actions were vetted by the Office of Legal Counsel. Even if it isn’t legal, it’s unlikely the actions will be challenged in court, primarily due to the fact that withholding aid in a pandemic is a bad look politically.

"If the Democrats want to challenge us in court and hold up unemployment benefits to those hardworking Americans that are out of a job because of COVID, they're going to have a lot of explaining to do," Mnuchin told "Fox News Sunday" host Chris Wallace on Aug. 9.

But that doesn’t mean there’s no chance legal action might be taken. Super said the House could sue, or more likely, states could sue to get clarity as to whether they will be paid. Right now, all states have is the administration’s word — and the administration can’t commit funds without congressional authorization.

“If the state believes, and I frankly think this is the case, that this is unlawful — that the president didn't have authority to issue that memorandum on unemployment because Congress has provided for unemployment and disastrous situations, and the president is violating the terms of what Congress set out — then, in that case, I think that a state could say, ‘We're not going to go forward with this unless we have a court decision that confirms that this is lawful and that if we do it, we will get paid,” he said.

More: Trump signs executive orders enacting $400 unemployment benefit, payroll tax cut after coronavirus stimulus talks stall

If the action is not challenged, it might set a precedent that makes the role of the president more powerful in the future.

“I think there have been lots of situations when there were benefits that presidents of different parties have wanted to give to particular constituencies, and if President Trump goes forward with this and there isn't anything challenging, then I think next time a Democratic president wants to provide a benefit — you know, wants to increase food stamp benefits or wants to broaden the Medicaid eligibility or something like that — they're going to feel a lot more free to do so," Super said. "And in their case, like in this one, it will be hard to sue them because there will be not much of anybody who's adversely affected — except the Constitution, which unfortunately doesn't have any lawyers.”

Our rating: Missing context

The claim that a president cannot spend taxpayer dollars by executive order is MISSING CONTEXT. It's true that the Constitution gives Congress the power of the purse, meaning the president cannot spend money without Congress appropriating it. But there are scenarios in which executive orders could be used to disperse funds, particularly from contingency funds. And Congress has given the president latitude to "shift things around."

Our fact check sources:

This article originally appeared on USA TODAY: Fact check: Presidential spending through executive order is allowed