Trampling on Checks and Balances

An insider explains how Trump's push to replace competence with political loyalty in staffing the government will warp and weaponize U.S. budget operations to reward friends and punish critics

By Stuart Kasdin

There has been a lot of talk about “Trump-proofing” California, or at least limiting the impacts of hostile actions.

I worked in the Office of Management and Budget (OMB), part of the Executive Office of the President, for about 12 years, spanning two Bushes and a Clinton. At least with respect to the role of OMB, I can outline what I see coming.

OMB staff are civil service employees, overseen by appointed political leadership. OMB staff are the program examiners who provide analysis and recommend budgetary, regulatory, and legislative changes to the leadership in OMB and the White House.

How budget process is supposed to work. The goals for OMB budget examiners are to help reduce government deficits and enhance the beneficial impacts of government programs. Each year, during “budget season”, OMB branches, each usually reflecting a federal department, are given a spending target that would cap funds for their department’s agencies and programs.

Their job is to evaluate agency budget requests and give unbiased recommendations as to which budget increases should be supported by OMB and the White House, and which should be rejected, along with which programs would receive flat, decreased, or no funding for that year.

OMB staff also annually propose ways to improve the efficiency of program delivery and whether the program should be redesigned to get more public benefits.

In contrast to the agencies tasked with advancing their agencies’ missions, the ethos of OMB is to provide accurate, unbiased analysis to the political leadership. It was OMB’s responsibility to say ‘no’ if a program were not an Administration priority, even when the agency political leadership and Hill staff preferred otherwise.

However, the Trump Administration is reconceiving the role of OMB.

Trump’s plan to politicize OMB. At the end of the first Trump Administration, the President released an Executive Order (EO) that would have changed the civil service. The order created a new classification - Schedule F - that would allow the political leadership to fire upper-level civil servant employees without cause.

Whereas previously, staff was required to be non-partisan and selected based on merit, the Schedule F criteria meant staff could be expected to demonstrate loyalty to President and his interests. The executive order was never implemented and it was repealed by the Biden Administration.

The new Trump Administration has now resuscitated it as one of the Administration’s first day executive orders.

The result is that some civil service staff will likely soon be fired. However, apart from a mass firing, those staff not replaced will know that they can be dropped at any point. If an action proposed by leadership is perceived as not legal by civil service staff, their alternative is to quit or be fired.

Impoundments and line items. So, what are some implications?

The White House, working through OMB, might use the threat of withholding grant funds to motivate members of Congress who consider voting against the President, as well as to punish cities that defy him.

Presently a President can’t legally do this; however, President Trump has expressed an interest in ignoring, amending, or overriding the 1976 law barring such “impoundments.”

An impoundment is when a President doesn’t spend the money that Congress appropriated. This is part of what led to the first Trump impeachment, in which he ordered OMB to withhold military aid to Ukraine as he sought to have the Ukrainian government open up a criminal investigation of Joe Biden ahead of the 2020 presidential election.

If President Trump ordered OMB to impound funds and Congress hasn’t amended the law, OMB staff would have no choice but to break the law, or quit, and Congress would have to impeach him if they didn’t like it.

The impoundment authority may sound similar to the line-item veto, or partial veto, which gives the president the authority to eliminate specific appropriations or programs, without vetoing the entire bill.

It is present in many states, including California, where the argument for it is that it permits governors to cut wasteful spending (“pork”) and control aggregate spending totals. However, per capita spending is not lower in states with line-item veto or item reduction. Research on state line- item vetoes suggest that they are used for partisan purposes and threats.

In 1996, Congress passed the Line Item Veto Act specifically to control "pork barrel spending", however, it was found to be unconstitutional by the U.S. Supreme Court in 1998 (Clinton v. City of New York). The Court found the Act violated the basic structure of how federal spending is to proceed (outlined in the Presentment Clause Article I, Section 7, Clauses 2 and 3) and as explained in I'm Just a Bill. The Trump Administration’s use of impoundments is an inevitable future Supreme Court case.

Decisions on how to allocate grants to states, cities, etc. will frequently pass through OMB.

Rewarding friends, punishing enemies. Cities and states are very dependent on these funds for supporting police and fire protection, clean water, and education -- for most states, over a third of their budgets come from federal grants. So, what if the Trump political leadership were intent on approaches that rewarded red municipalities and gave less money to ‘blue’ states, and punishing universities or non-profit agencies?

For example, President Trump sought to punish sanctuary cities by stripping them of federal funding. In 2019, an appeals court found that awarding extra points in the application process to cities that cooperate was consistent with the goals of the grant program created by Congress.

The Trump Administration can revise each grant to add new factors to the ranking process for which states receive funding. The courts will have to evaluate each case to see if the factors are justifiable for the purposes of the grant or merely vindictive.

Finally, the President might just shift appropriated funds to his preferred ends, regardless of the appropriations.

The President, according to the Constitution, is supposed to implement the programs and projects that Congress has funded. However, in the first Trump Administration, he occasionally would shift money appropriated from one purpose for another.

In one case, he shifted funds appropriated to the Department of Defense to be used for the border wall. He was sued but the Supreme Court accepted the justification of a national emergency. We can expect more of that.

No constraints on presidential power. Checks and balances only works if each of the parties respect the role of the others. However, these new expected changes are aimed at trampling on checks and balances. President Trump has indicated that he does not believe there should be any constraints on Presidential power. OMB will be the tool to achieve that authority.

Sadly, OMB’s future looks like the death of OMB as a source of neutral or responsive competence.

As Russ Vought, previous OMB director in the Trump Administration and newly proposed for it again described it, OMB was just “A bunch of people around him who were constantly sitting on eggs and saying, ‘Oh my gosh, he’s getting me to violate the law.’” Instead, the agency will now be forced into breaking the law.

But Vought observed, we are living in “a post-Constitutional time.”

The irony is that the expected Schedule F changes will destroy OMB as a source of competence. It will undermine the Administration’s ability to reduce low priority spending and maximize efficiency goals.

The Administration’s focus on partisan and personal loyalty to Trump will make accomplishing a leaner, more effective government less likely. I fear that the OMB I knew and respected soon will be lost and California and the country will be worse off for it.

Stuart Kasdin is a member of the Goleta City Council and an adjunct professor at Santa Barbara City College. First elected in 2016, he previously served in the U.S. Office of Management and Budget under presidents of both parties. This op-ed reflects his views only, not those of his employers.

Image: Stuart Kasdin (LinkedIn).