President Has the Upper Hand in a Shutdown
Like a piano player in a lounge who plays show tunes and other favorites, I’m more than happy to take requests. So when I received a number of calls in response to last week’s “Fiscal Fitness” about the federal debt ceiling asking analogous questions about a government shutdown, I thought it appropriate to devote this week’s column to that topic. (Plus, like a piano player, I can use the tips.)
The term “government shutdown” is actually something of a misnomer. What we’ve come to call a shutdown happens when Congress and the president fail to enact appropriations by the time the existing funding expires. That means the only federal activities affected are those that require the enactment of new appropriations.
Many people forget that about two-thirds of federal spending is on interest on the debt and on mandatory programs that are funded with permanent appropriations that don’t expire. As a result, some of the largest federal programs will not be shut down if Congress and the White House can’t, won’t or don’t agree on a new continuing resolution, an omnibus appropriation or individual appropriations when the current CR expires at midnight March 4.
That’s not all. In addition to the permanently funded programs that will continue, some of the programs funded by annual appropriations will continue to function if the CR isn’t extended.
According to what’s generally considered to be the most important interpretations of what happens when appropriations aren’t enacted, the opinions issued in 1980 and 1981 by Carter administration Attorney General Benjamin Civiletti, federal programs funded with annual appropriations may continue to operate if there’s a “reasonable and articulable connection between the function to be performed and the safety of human life or the protection of property.”
A year or so after Civiletti issued his opinions, President Ronald Reagan’s Office of Management and Budget director, David Stockman, listed the federal activities that would continue if existing funding expired, even though they legally require an appropriation to operate. His memorandum included some items that might be expected, such as national security, law enforcement and medical care for those already in hospitals, as well as some that many might find both surprising and infuriating, like “the conduct of foreign relations.”
Although they both are cited as precedent, neither the Civiletti opinions nor the Stockman memo are legally binding. Because of that, it will be up to the Obama administration to determine what activities will and won’t be affected if a shutdown occurs. Members of Congress may complain and criticize the White House for its decisions, but unless the leadership in the House and Senate can muster the two-thirds vote needed to override an almost certain veto, even passing legislation specifying which programs must and must not continue to operate won’t have any practical effect.
The White House would also have to decide how to handle programs and government functions that didn’t exist in Civiletti and Stockman’s time — or even 15 years ago, when the last two federal government shutdowns resulted from a battle between Speaker Newt Gingrich (R-Ga.) and President Bill Clinton. There was no Department of Homeland Security, for example.
The Obama administration will have enormous discretion in other ways. Whole departments, agencies and programs are not automatically exempt just because they fall into one of the categories Civiletti and Stockman cited, and it will be up to the White House to decide which activities will be conducted if a shutdown actually occurs.
The administration is also free to reject the precedents for reasons that include economic and technological changes, new programs and functions, political hardball, and more. For example, just because Stockman said in 1981 that the civil air traffic control system would continue to operate doesn’t mean that the White House has to agree in 2011. And the growing use of electronic payments by the federal government may well mean that some of the work performed by individuals during the 1995 and 1996 shutdowns won’t be needed this time.
The bottom line about a federal government shutdown is simple: The president has far more room to maneuver and is in a much better position to take control of the situation than Congress. As Clinton showed in 1995 and 1996, when he reclassified some programs several weeks into the fight so that they could operate despite originally being on the shutdown list, the White House even has the ability to change its determinations.
From a federal budget process perspective alone, the president’s advantage in this situation should be obvious: Once Congress decides not to adopt a funding bill, it can do little more than try to blame the president for the shutdown. At that point, the upper hand unambiguously shifts to the White House, which can take credit for decisions that keep the country safe and the economy functioning during the crisis. That makes it very hard for Congress to look good with a majority of voters.
Stan Collender is a partner at Qorvis Communications and founder of the blog Capital Gains and Games. He is also the author of “The Guide to the Federal Budget.”