Stimulus opens new front in Trump's oversight fight
President Trump is using the coronavirus bailout to keep up his long-running battle against congressional oversight, potentially laying the groundwork for yet another showdown with Congress.
There are already an unprecedented number of court battles between the legislative and executive branches under his administration, with the stimulus package opening what could be yet another front.
Trump last week signed the $2 trillion coronavirus relief bill but said he would ignore provisions directing the bailout’s overseers to consult with Congress, saying they posed “constitutional concerns” to the president’s ability to direct and control the executive branch.
The oversight provisions were included at the behest of Democratic negotiators and helped win the party’s support for the bill despite concerns about what they called a massive corporate “slush fund.” The provisions require a special inspector general for the program to make regular reports to Congress to ensure legislative oversight.
“I do not understand, and my administration will not treat, this provision as permitting the [special inspector general for pandemic recovery (SIGPR)] to issue reports to the Congress without the presidential supervision” required by the Constitution, Trump said in a signing statement.
“These provisions are impermissible forms of congressional aggrandizement with respect to the execution of the laws,” he added of another section requiring some officials to obtain permission from congressional committees for spending.
Trump said the administration would notify committees of their plans but would “not treat spending decisions as dependent on prior consultation with or the approval of congressional committees.”
Brianne Gorod, the chief counsel at Constitutional Accountability Center who has filed numerous briefs in support of House Democrats in their court cases with the president, said Trump’s signing statement was consistent with his attitude toward congressional oversight.
“I think this is of a piece with the legal theory that we've heard from conservatives for some time, that basically this president needs to have control over every single thing that happens in the executive branch,” Gorod said. “We can, it seems, expect the president to be no more cooperative when it comes to oversight in this area than he's been in all of the other areas in which Congress has been trying to engage in oversight for more than a year now."
The coronavirus stimulus lifted much of its oversight language from the bank bailout in the 2008 stimulus bill in response to the financial crisis, the Troubled Asset Relief Program, which ultimately disbursed $431 billion. Unlike Trump, former President George W. Bush signed the bill into law without objecting to the reporting requirements for the fund’s inspector general.
The latest $2 trillion relief bill, aimed at mitigating the economic toll from the coronavirus pandemic, includes a fund of more than $500 billion in assistance for large corporations.
Danielle Brian, the executive director of a nonpartisan watchdog called the Project on Government Oversight, said that Congress has an important role in overseeing such massive funds to prevent money from being directed to politically connected businesses.
“The power of an IG [inspector general] is largely derived from their ability to communicate directly with Congress because if all they can do is tell the head of an agency when there's bad news, and that's where it stops, then there's little likelihood or incentive for any problems to be addressed,” Brian told The Hill.
“In this particular case, the reason it matters even more is that I think every American understands that money that is squandered or diverted from its intended purpose is directly harming people's lives at this point.”
After railing against the massive “corporate slush fund” during negotiations, Democrats ultimately supported the bill after Republicans, led by Treasury Secretary Steven Mnuchin, agreed to demands that the fund be policed by a number of oversight bodies.
Those include a special inspector general to be appointed by Trump and confirmed by the Senate, a committee of inspectors general for Cabinet agencies and another committee of lawmakers appointed by congressional leaders. The bill requires each entity to consult with or report to Congress. Trump says that is an unconstitutional encroachment on his presidential powers to control executive branch personnel.
Trump is not the first president to use a signing statement to declare that he will not enforce or abide by parts of legislation that he deems unconstitutional. Administrations of both parties have often used signing statements to endorse an expansive view of executive branch power.
Bush escalated the practice during the 2000s and Obama early in his administration defended signing statements, saying in a memo that they “promote a healthy dialogue between the executive branch and the Congress.”
But critics said Trump’s statement last week was significant because it appeared to renege on the administration’s agreement with Democrats and furthered his attacks on congressional oversight.
Democrats have expressed outrage over the past week that Trump used such a signing statement to attack provisions that his own administration endorsed during negotiations to win over bipartisan support.
“You, on behalf of the Administration, negotiated and agreed to the scope and terms of the SIGPR authority, both generally to Congress and to each of us personally,” Senate Minority Leader Charles Schumer (D-N.Y.) and two other top Senate Democrats wrote in a letter to Mnuchin on Tuesday.
“This oversight authority was critical for gaining support for your request for over $500 billion to aid struggling companies, states, municipalities, and other troubled entities,” they wrote. “Provision of these funds was conditioned on the SIGPR’s creation. As such, the SIGPR’s unfettered operation is not only a legal necessity, but also a condition you personally agreed to — SIGPR’s structure is your structure, and it imperative that you defend it.”
Rep. Carolyn Maloney (D-N.Y.), who chairs the House Oversight and Reform Committee, also lashed out at Trump’s effort to reduce Congress’s supervisory role over the bailout.
“President Trump’s efforts to undermine oversight will only hurt the American taxpayers who want their dollars to be spent effectively and efficiently,” Maloney said in a statement to The Hill. “There is no doubt that the Administration has mishandled this entire crisis, and our Committee will certainly be engaged in robust oversight to review what happened and how to avoid these mistakes in the future.”
How effectively Congress will be able to exercise its oversight powers over the bailout could depend on how the courts rule in Trump’s fights against other efforts from House Democrats to investigate him and his administration.
Later this month, the D.C. Circuit Court of Appeals will hear oral arguments from the Trump administration and the House in a case over a congressional subpoena for former White House counsel Don McGahn’s testimony, after a panel of judges ruled that Congress cannot seek to enforce its subpoenas in the courts.
The full circuit is now rehearing the case, which could ultimately end with the Supreme Court deciding whether congressional subpoenas are legally valid. That decision could impact the balance between Congress and the executive branch beyond just subpoenas.
"If Congress can't go to court to enforce its subpoenas in one area it won't be able to go in all the other areas where I think everyone would agree oversight is critically important,” Gorod said.