Mitch McConnell has proposed a new way to deal with the debt ceiling issue:

Under Mr. McConnell’s plan, Congress would pass legislation authorizing the president to request a total $2.5 trillion debt-limit increase in three stages—$700 billion by Aug. 2 followed later in the year by two $900 billion installments. The increases could take effect without congressional approval, but Congress could block it with a resolution of disapproval.

In general, under McConnell’s plan: (1) the President is required to propose the debt-limit increase; (2) Congress can respond with a “resolution of disapproval,” which requires a vote of a majority of each house; (3) the President can veto that resolution, which presumably he would; and (4) Congress can attempt to override that veto with a 2/3 supermajority in both houses.  The purpose of the plan is that Republicans can place the blame (some individuals find raising the debt ceiling unpopular) for raising the debt ceiling on the President, because there is no chance that 2/3 of both houses would vote against raising the debt ceiling.

Such a plan is likely unconstitutional under the Supreme Court’s decision in I.N.S. v. Chadha, 462 U.S. 919 (1983).

A. Chadha

In Chadha, Congress passed an Act which allowed the Immigration and Naturalization Service (INS) to suspend deportations of illegal aliens.  However, the Act further specified that Congress could reject the INS’s decision to suspend deportation, and that, to do so, either house of Congress merely needed to pass a resolution of disapproval, with a majority vote.

After Congress passed such a resolution of disapproval, the resolution, and Act, were challenged and eventually were reviewed by the Supreme Court.  The Court held that the Act was unconstitutional.

The Court wrote that, when one of the three branches of the government acts, it must act according to the procedures set forth in the Constitution. Importantly, the Constitution sets forth a specific procedure Congress must follow when it takes a legislative act, meaning doing something like passing a bill, but not simply making internal Congressional rules.

Specifically, when taking a legislative act, except in limited circumstances spelled out in the Constitution (such as impeachment), the Constitution only allows Congress to act through “bicameralism” and “presentment.”  “Bicameralism” means passage by both houses, and “presentment” means presenting the passed bill to the President for signature or veto.

In Chadha’s case, the Act allowed Congress to take a legislative act (passing a resolution of disapproval) without bicameralism or presentment, because either house could pass the resolution of disapproval, and the President didn’t get to sign or veto the resolution.  Thus, the Act was unconstitutional.

To dispel any argument that such a ruling would cause inefficiencies, the court explained, in one of my favorite Supreme Court lines of all time:

The choices we discern as having been made in the Constitutional Convention impose burdens on governmental processes that often seem clumsy, inefficient, even unworkable, but those hard choices were consciously made by men who had lived under a form of government that permitted arbitrary governmental acts to go unchecked. There is no support in the Constitution or decisions of this Court for the proposition that the cumbersomeness and delays often encountered in complying with explicit Constitutional standards may be avoided, either by the Congress or by the President. See Youngstown Sheet & Tube Co. v. Sawyer, 343 U.S. 579, 72 S.Ct. 863, 96 L.Ed. 1153 (1952). With all the obvious flaws of delay, untidiness, and potential for abuse, we have not yet found a better way to preserve freedom than by making the exercise of power subject to the carefully crafted restraints spelled out in the Constitution.

I.N.S. v. Chadha, 462 U.S. 919, 959 (1983).

B. McConnell’s Plan

McConnell’s plan is slightly different than that in Chadha.  Unlike Chadha, it does not authorize a single house to take “legislative action.”  However, it does allow the President, as opposed to Congress, to take legislative action, and allows Congress to effectively have a veto power over the President.  Thus, Chadha, as well as the Constitution, suggests that McConnell’s plan is unconstitutional.

First, Article 1, Section 8, lists Congress’ powers, and Clause 1 of that Section states that “[t]he Congress shall have Power . . . . to pay the Debts . . . .”  It is Congress’ role to “pay the Debts,” which, throughout our nation’s history, has meant that Congress proposes the plan to pay the debts, and the President signs or vetoes, and then Congress can override a veto.  In other words, to “pay the Debts,” bicameralism and presentment must be followed.

However, under McConnell’s plan, the roles of Congress and the President are flipped.  The President is the one who must propose “legislation,” and then Congress effectively gets veto power over the proposal.  To pass this “legislation” (i.e. raise the debt), Congress would not need a vote from both houses (bicameralism) – rather, they would only need one house NOT to pass a resolution of disapproval (because if both houses don’t vote to disapprove, the debt increase occurs).  If both houses passed such a resolution, and the President then vetoed it, then only one-third of one house could ensure that the debt ceiling would be passed, because the only way to stop the debt ceiling increase at that point would be to have 2/3 of each house vote against the debt ceiling increase (to override the President’s “veto”).

In other words, under McConnell’s plan, there is no ordinary bicameralism and presentment process.  Instead, Congress simply abdicates its power under the Constitution to “pay the Debts.”  Hence, McConnell’s plan is unconstitutional.

C. Aside: Political Accountability

As an aside, one of the main checks against the power of Congress and the President is accountability to the people.  The purpose of McConnell’s plan is to avoid accountability, by making the President appear to be the only one responsible for debt ceiling increases, when, for all practical purposes, Congress forces the President to increase the debt ceiling.  Such avoidance of accountability is not unconstitutional, per se, but certainly raises doubts as to its desirability.

chadha, constitution, debt ceiling, mcconnell, president, unconstitutional

The WSJ is reporting that ethanol subsidies may end by August.  If so, that is fantastic news.

Sen. Dianne Feinstein (D, Calif.) said in a statement that she had reached an agreement with Sens. Amy Klobuchar (D, Minn.) and John Thune (R, S.D.) under which a 45-cent-a-gallon tax credit for blending ethanol into gasoline would expire on July 31. A 54-cent-a-gallon tax on imported ethanol would also expire at the end of the month.

Some $1.33 billion in savings would be used to reduce the $14.29 trillion U.S. debt. A third of the savings—an estimated $668 million—would be used to extend tax credits, such as those for alternative-fueling infrastructure like ethanol pipelines that some producers hope to build.

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Shortly after my last post, the Senate re-voted on whether to eliminate ethanol subsidies, and this time, the measure passed, 73-27.  Apparently many Democrats who voted against the earlier measure on alleged procedural grounds voted for it in this instance.  Though perhaps they voted for it because it was attached to the Economic Development and Revitalization Act, which the Washington Post posits is unlikely to obtain final senate approval.

ethanol, senate

On June 14, 2011, the Senate voted on a bill to repeal $6 billion in annual ethanol tax subsidies.  These ethanol subsidies are wasteful and unhelpful to Americans, as I have discussed in prior posts.  For example, ethanol production requires a large amount of land area, some evidence suggests that ethanol costs more energy to create than it yields, using corn for fuel increases the price of food, ethanol adversely impacts fuel economy and damages older vehicles, and even damages newer vehicles when in high enough concentration (see the prior three links for more information).

Despite the fact that politicians almost uniformly agree that the nation has a debt problem, and thus needs to either decrease spending, increase taxes, or both, the measure failed, because there were not enough votes to overcome a filibuster.

There are two sources of blame for this.  First are the Democrats, who overwhelmingly voted against the bill.  Supposedly one of the major reasons was because Harry Reid whipped against the bill due to alleged procedural problems.  Though I think the more likely answer is so that Democrats can attempt to grandstand about creating or preserving jobs, no matter how worthless the jobs are.  (For example, President Obama recently remarked on the Today Show, that “there were ‘structural issues with the economy. . . . You see it when you go to a bank you use the ATM, you don’t go to a bank teller.’”)  It’s true that subsidizing ethanol will preserve jobs in the ethanol industry.  Though of course if those jobs are worthless, then the government might as well be paying people to dig holes and then fill them up again.  It is inexcusable that Democrats would overwhelmingly continue to support ethanol subsidies when the evidence simply shows that they do more harm than good.

But the more surprising source of blame are a select group of Republicans, led by Grover Norquist (not a senator), the founder of the Americans for Tax Reform.  The ATR members have signed a pledge that they refuse to raise taxes for any reason except for economic growth.  Norquist ordered the members of the ATR to withhold support for the anti-ethanol bill because eliminating the ethanol subsidy, to Norquist, would be tantamount to raising taxes.

I disagree with the rationale for Norquist’s order on two grounds.  First, tax subsidies are spending just as much as they are tax increases.  If the government agrees to give me $10 at tax time (spending) or agrees to give me a $10 decrease in tax liability at tax time (subsidy), the net effect is the same: the government transfers $10 of wealth to me.  Likewise, the tax subsidies that the ethanol industry receives are a transfer of wealth from the government to private businesses.  Whether they are characterized as a tax increase or spending cut is immaterial.  The key question we should be asking is whether the costs of this tax subsidy exceed the benefits.

That leads me to the next objection I have to Norquist’s order, specifically, that Norquist unequivocally refuses to consider the merits of legislation that “raises taxes,” simply because he believes that it “raises taxes.”  Norquist refuses to consider the costs and benefits of what he thinks are a tax increase, even if they benefits would vastly exceed the costs.  This of course will impede bargaining with any politician who believes that solving the federal debt problem requires a combination of spending reduction and tax increases.  And this problem is exacerbated by the fact that Norquist’s definition of “raise taxes,” is much far too broad.

ethanol, norquist, taxes

If you haven’t heard yet, Osama bin Laden was killed this past weekend (see WaPo, WSJ, NYT, CNN, NPR).  This is a positive development for the United States, and the world, in my judgment.  But right now, the real work has began: the political spin machines on both the right and left are working hard to spin this story the way they want it.  I’ll make predictions now (9:50 am eastern time on 5/2/2011, about 10 hours after bin Laden’s death was announced) about how the spin machine over the next week will treat this story.  I predict by 5:00 pm eastern time on 5/3/2011, we’ll see most of these spin stories emerge.

From the left:

1. Death of Osama is the greatest thing since sliced bread.  Death of Osama cures cancer, stops climate change, makes everyone in the world love the United States.
2. Death of Osama shows that President Obama is the greatest commander in chief ever; President Bush had absolutely no hand in killing Osama.
3. When a commentator slips and accidentally says “Obama” instead of “Osama,” (I already heard someone slip on NPR this morning) he or she is labeled as a racist.

From the right:

1. Congratulations to President George W. Bush / “our military” while deliberately avoiding mentioning President Obama’s name.
2. The death of Osama could have occurred earlier, but President Obama waited until recently to improve his election prospects.
3. “Killing Osama doesn’t matter.  Who cares?”  (if this happened while GWB were in office, the left would be saying this, obviously).  Or, alternatively, “why are we celebrating someone’s death?  How cruel are we!”

From Donald Trump:

1. That wasn’t Osama.  Where is the birth certificate?

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