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more probable when thc Eberstadt task force agreed to the 58 groups but on the underof thc Iloover Commission released its find. standing that “if the money is appropriated ings on thc Pentagon. In December 1948, the it may not be used” by the president (U.S. task force charged that intense interservice Congress, 1949b: 14355, 12855). Truman rivalrics had hampered defense policy and signed the bill, explaining that it was his rethat military services lacked a “sense of cost sponsibility to provide a defense structure consciousness,” being "far too prodigal” with which would meet the needs of national government funds. The following April, for- security without imposing too great a strain mer President Hoover told Congress that $1.5 on the domestic economy. He was concerned billion could be cut from the military budget not merely with the additional procurement without threatening national security (The costs for aircraft but also such related items New York Times, 1948; 1949a). Although as extra personnel, higher maintenance and Secretary Johnson considered the defense operating costs, and greater replacement budget too small when he presented it in expenses. He reminded Congress, inorcover, 1949, he concluded that larger appropria that his defense program was based on a tions—because of waste within the Defense unified strategic concept, and that an exDepartment-would be like throwing money panded air force would necessitate aug. "down a rat hole” (U.S. Congress, 195la; mented levels for other services. To maintain 2607).
a balance between national security and a Still another factor behind the impound sound economy, he placed the extra air force ing of air force funds was Truman's fiscal funds in reserve (Truman, 1949: 538_539). policy of relying on budget surpluses and debt retirement to restrain inflation. Twice Supercarriers in 1947 he vetoed wax-reduction bills, but in A second major iinpoundment dispute dur1948, when he again vetoed a tax-reduction ing the Truman vears involved cancellation bill, Democrats joined with Republicans to of the U.S.S. United States. The cost of this override him. With revenue now lost to tax giant aircraft carrier, designed to accommorelief, and receipts down as a result of the date long-range bombers with atomic bombs, 1948-49 recession, Truman rcdoubled his was estimated by the navy at $189 million. efforts to control expenditures.
Other estimates placed the total closer to By the tine Air Force Secretarv Stuart $500 million for the vessel and another $500 Symington testified before Congress in June million for planes to fly from it. To the air 1949, he no longer insisted on 70 air force force, the carrier represented the navy's atgroups as he had in the past. Instead, he now tempt to intrude on its strategic air prerogaplaced his budgetary request in the context tives. By 1949, the feud between the tivo of the president's program. The air force rec- services had become acrimonious (Hamognized, he said, that armed forces are only mond, 1963). The keel laving of the United onc component of our total national strength. States took place as scheduled, but with a We recognize further, the great burden of minimum of ceremony and a fatalistic sense responsibility on those in positions of highest that the project was about to bc shelved authority to balance the several components (The New York Times, 1949b). of this strength to nicct the needs of the The premonition proved correct, for within United States; and therefore, we support a few days Secretary Johnson canceled the the President's budget" (U.S. Congress, carrier. Besides the greater scrutiny given 1949a: 32S).
defense spending during this period and a The Senate joined with the president in change in secretary of defense, a change in opposing air force funds added by the House, budget procedures contributed to the abanand the matter lay cleadlocked in conference donment of the project. During Forrostal's committee. A motion by the Senate to vote administration, appropriations were made to continuing appropriations was rejected by cach military service; consequentlı, the Joint the House. With adjoumment close at hand, Chicfs did not pass judgment on individual and military services in need of funds to service items. According to Admiral Denmeet their payrolls, the Senate reluctantly fold, chief of naval operations at the time, when the United States was originally ap- secretary of defcnsc. Several agencies inproved “it did not have to go (to) the Joint volved in research, development, and defense Chicfs of Staff, because at that time, we did supplies were abolished, and their functions not have a combined budget for the three transferred to the secretarv. By shifting from services. It was a unilateral question on the the wishes of the individual services to the part of the Navy that they needed this ship” “broadcst conception of the over-all national (U.S. Congress, 1949a: 162).
interest, Eisenhower hoped to strengthen Forrestal had met with the Joint Chicfs at the powers of the defense secretary over reKey West, in March 1948, reaching an agree- search and development, the budget, and ment to reserve to the air force the mission strategic planning (Eisenhower, 1953: 225; of strategic bombing. Nevertheless, hc re- 67 Stat. 638). turned home to tell the president that a dcci. In 1958, Eisenhower pressed for greater sion had been made to proceed with the unification of strategic and tactical planning, supercarrier and "development of HA (high recommending that the defense secretary be altitude) aircraft to carry heavy missiles given additional authority over military rethercfrom.” Subscqucnt discussions between search and development and the manageForrestal and the Joint Chiefs simply under- ment of defense funds. Such authority, he lined the fact that the Key West mecting said, “will go far toward stopping the ser had failed to resolve disputes over service vices from vying with each other for Conmissions or the fate of the supercarrier (.1lil gressional and public favor” (Eisenhower, lis, 1951: 392–393, 464-477). Defense Secre. 1958: 286; cf. Adams, 1962: 296). Eisenhower tary Johnson said that Forrestal had come objected to the service secretaries and the to have some doubts about the carrier, but Joint Chiefs bypassing the secretary of de "didn't feel that he could do anything about fense and taking their grievances directly to it” (U.S. Cong.ess, 1951a: 2636).
Congress. He called this “legalized insuborWhen Johnson became defense secretary dination" and an invitation to interservice and responsicle for submitting a single rivalries, but Congress reaffirmed the privibudget for the three services, he discussed legc of the secretaries and the Joint Chiefs to the carrier issue with the Joint Chiefs and make a commendations to Congress on their with General Eisenhower, who served in an own initiative (Eisenhower, 1958: 413). advisory capacity. Two of the three Chicfs In 1958, when the armı wanted to proceed opposed the carrier, as did Eisenhower. Carl with a $6 billion Vike-Zeus antimissile sistem Vinson, chairman of the House Armed Ser. Defense Secretary VicElror decided that vices Committee, advised Johnson to cancel additional research was necded before beginthe carrier, and Millard Tidings, chairman ning production (U.S. Congress, 1955: 356). of the Senate Armed Services Committec, The next rear, top army officers pressed also approved cancellation. On the basis of again for funds to start production. VicElror this advice from military and legislative insisted that technical deficiencies-particuleaders, and with President Truman's ap- larly in the radars and computers-had to proval, Johnson canceled the carrier. In its be overcome first. General Maxwell Tavlor. place, he approved construction of a carrier army chief of staff, deplored the delar in which he called “appreciably smaller, less of production and expressed the opinion that a show piece, and more of a fighting ship" the “importance of obtaining this unique (U.S. Congress, 1951a: 2636_55).
anti-missile weapon at the carliest possible
date outweighs the possible financial risks Antiballistic Missiles
inherent in initiating selective production President Eisenhower continued Truman's now." (The New York Times, 1959). Of policy of strengthening civilian control over course Gencral Taylor, unlike the president, the military services and reducing interscr- had absolutely no responsibility for “financial vicc rivalry. Eisenhower's 1953 Reorganiza- risks” or for the condition of the national tion Plan for the Department of Defcuse economy. cmphasized the need for “clear and unchal Congress satisfied the army in August 1959 lenged civilian responsibility:* centered in his by appropriating $137 million for initial procurement of Nikc-Zcus hardware. The Ad- appropriated, and also thought the change ministration impounded the funds while in language would be more clcarly in linc awaiting results from further tests. In Janu- with the spirit of the Constitution" and its ary 1960, President Eisenhower stated that separation of powers (U.S. Congress, 1962b: funds would be relcased for continued de- 4694). The llouse acceded to the president's velopment but not for production. Shortly request and the Administration went ahead before leaving office, hc again insisted that with its plan to complete two prototypes of funds should not be used for production the B-70 before considering full-scale pro"until development tests are satisfactorily duction. One prototype crashed in June 1966, completed” (Eisenhower, 1960–61: 54–55, and the second now sits in the Air Force 414). Defense Secretary McNamara later Museum at Dayton, Ohio. estimated that deployment of Nike-Zeus would have cost $13 to $14 billion and that Nuclcar-powered Frigate "most of it would have had to be torn out and A similar impoundment dispute over the replaced, almost before it became opera- nuclear-powered frigate reached the point in tional,” to make way for more advanced mis- 1966 where the House threatened to direct siles and radars (U.S. Congress, 1967a: 5). that funds be spent on the vessel. The Senate Not until September 1967 did the Johnson softened the language to stipulate that conAdministration agree to deploy a light ABM tracts for construction of the frigates be ensystem against a possible Chinese threat in tered into “as soon as practicable unless the the 1970s.
President fully advises the Congress that its
construction is not in the national interest" B-70 Bomber
(Stassen, 1969: 1168–76). Another hotly contested impoundment involved the B-70 bomber, a long-range
ANTI-INFLATION POLICY manned aircraft billed as successor to the Federai responsibility for economic stabilB-52. In 1961, Congress added $180 million ity—tacity admitted during the 1930s and to the $200 million requested by the Kennedy during World War II-received formal acAdministration for B-70 development. De knowledgment with the Employment Ac of fense Secretary McNamara, stressing our ad- 1946. Explicit objectives of the Act included vantage over the Soviets in bombers and the the promotion of maximum employment, deterrent capability of American missile production, and purchasing power. Though strength, refused to release thc unwanted control of inflation was not specifically menfunds (The New York Times, 1961). In tioned (a postwar depression scemed more March 1962, the Ilouse Armed Services Com- likelv), price stability could be inferred from mittec voted to direct thc sccretary of the air the goal of maximum purchasing power and force to spend not less than $191 million the development of policies to "avoid ecoduring fiscal 1963 toward production of the nomic fluctuations” (60 Stat. 23, sec. 4(c)). B-70. To remove any doubts about its inten- All postwar presidents interpreted the Act tion, the committee said that the secretary to include federal responsibility for combatwas "directed, ordered, mandated, and re- ing inflation. The question was whether this quired” to spend the full $191 million. The responsibility would fall primarily on Concommittee added that “If this language con- gress or on the president. stitutes a test as to whether Congress has the power to so mandate, let the test be made Spending Controls ..." (U.S. Congress, 1962a: 1. 9).
Congress tricd several techniques in the The confrontation took place and Congress postwar years to place restrictions on fedlost. President Kennedy wrote to Chairman eral spending. As part of the Legislative Vinson of the House Armed Services Com. Reorganization Act of 1946, a joint commitmittce, urging that the word "authorized" be tee was formed to prepare a legislative substituted for “directed." The president con- budget and prescribe a ceiling on expenditended that this was more suitable for an turcs. The work of the joint committee, conauthorization bill, since funds had not been sisting of 102 members from the taxing and
spending committees of cach house, was a proposal by Scnators Byrd and Bridges hampered by friction between the two to bring about an estimated reduction of houses, between taxing and spending com- $525 million, calling for a 10 percent cutback mittecs, and by intraparty wrangling. More- in nonmilitary items and cxcmpting certain over, this new procedure conflicted with the programs (U.S. Congress, 19500: 11547-695; established practice of having separate ap- Truman, 1950: 543). . propriations subcommittccs review the pres. The conference committee decided to drop ident's budget to decide the level of funding. both thc Taber-Thomas and Byrd-Bridges Thus, the legislative budget prematurely set amendments and simply direct the president a ceiling before the subcommittees could to cut the budget by not less than $550 milcomplete their work, and was abandoned by lion without impairing the national dcfense. Congress after thrce unsuccessful efforts (cf. President Truman fulfilled the statutory diLeiserson, 1948; Fielder, 1951).
rective by placing $573 million in reserve, In 1950, instead of. handling appropriations including $343 million in appropriations, by scparate bills, the House Appropriations $119 million in contract authority, and $110 Committee reported out an omnibus appro- million in authorizations to borrow from the priation bill. In addition to making selective Treasury (64 Stat. 595, sec. 1214; U.S. Concuts in the president's budget, the House gress, 1951b). Congressman Phillips later reconsidered a proposal by Congressman marked, it was “an ironic paradox that memThomas to authorize the president to cut the bers of Congress who shudder at the thought budget by an additional $500 million, subject of a Constitutional amnendment allowing a to two legislative guidelines: reductions President to veto individual items in a bill would not be applied to military programs, have supported an extra-Constitutional deand no domestic program could be cut by vice which in effect gives the President the more than 15 percent. Clarence Cannon, same veto power but allows the Congress no chairman of uic House Appropriations Com- opportunity to override him” (Phillips, 1951: mittee, considered this an abdication of 255; ci. Nelson, 1953). legislative responsibility, while Congressman Befo:c 1950, the authority to create reKeefe charged that the prospect of turning serves and to spend less than Congress apover to the president the responsibility for propriated had been drawn initially from the making reductions was “a monstrous display Budget Bureau's interpretation of the Budget of congressional incompetence, to sav the and Accounting Act, and then later supleast" (U.S. Congress, 1950b: 612, 6914). ported in 1933 bv Executive Order 6166. The Congressman Taber moved to increase the effect cf Section 1211 of the 1950 omnibus reduction from $500 million to $600 million, appropriation act was to amplify this aubut limited the president to 10 areas in which thority in the statutes and the U.S. Code: cuts could be made, and restricted the reduc- “In apportioning any appropriation, reserves tions to either 5 or 10 percent. The Taber- may be established to provide for contingenThomas proposal passed, satisfving economy cics, or to effect savings whenever savings advocates as well as those who wished to are made possible by or through changes in exercise greater congressional responsibility requirements, greater efficiency of operain the spending power (U.S. Congress, 1950c: tions, or other developments subsequent to 6815, 6844).
the date on which such appropriation was By the time the Senate began debate on made available" (64 Stat. 595, sec. 1211: 31 the omnibus appropriation bill, South Korea U.S.C. $665 (c)). had been invaded and President Truman moved quickly to curb domestic spending Anti-Inflation Policy ordering all exccutive agencies to defer The meaning of changes in requirements" civilian programs which did not directly and "other developinents” has been broadly contribute to defense needs. Legislative ac- interpreted to include inflationary pressures. tivity after this point was not much more Congressman Mahon explained that Presithan a sanctioning of presidential war pre- dent Jolinson impounded funds in 1966 when rogatives. Nevertheless, the Senate adopted "we had inflationary problems, and a chang. ing condition following the time the appro- construction bid prices, after remaining relpriations were made, and I assume the Pres- atively stable over a seven-year period, had ident relicd upon the portion of the law (the risen 12 pcrccnt in 18 months (U.S. Congress, 1950 omnibus appropriation act) to which I 1967d: 78, 111). Ilis successor as budget dihave referred” (U.S. Congress, 1967b: 29282). rector, Charles J. Zwick, justificd the freczing
In signing an agricultural appropriation of highway funds on the grounds of good bill in September 1966, President Johnson management. When funds were withheld, noted that Congress had added $312.5 mil. the construction cost index dropped by about lion to his budget request. “During a period,” 3 pcrccnt for several quarters. Zwick argued he said, "when we are making every effort to that prudent management of these funds moderate inflationary pressures, this degree would produce more miles of highway, and of increase is, I believe, most unwise." In that there was nothing in the law that says stead of vetoing the bill and losing funds he “every time a dollar comes in you must shove wanted, he decided to reduce cxpenditures it out no matter what it costs.” Hc referred for certain items in the bill "in an attempt to to an opinion by Ramsey Clark, acting at. avert expending more in the coming year torney general, who declared that the secrethan provided in the budget" (Johnson, tary of transportation had the power to defer 1966: 980). The president's economic mes- the availability of highway construction sage to Congress, September 8, 1966, esti- funds which had not yet become the subject mated that spending must be cut $3 billion of a contractual obligation by the federal to protect the nation's economy. Johnson had government in favor of a state (U.S. Conalready ordered agencies to save $1.5 billion gress, 1968: 72–73, 134). by deferring, stretching out, and otherwise These economic and legal justifications reducing contracts, ne v orders, and commit- failed to placate localities affected by the ments. Whenever possible, appropriations cutbacks. Sensitive to criticism from the provided in excess of the president's recom- states, President Johmson released $175 milmendations were to be withheld (Johnson, lion in highway funds in February 1967, and -1966: 987-988).
on the eve of a conference the next month Exactly where the economy axe would fall with governors, released another $791 milwas not known until after the November clec- lion, including $350 million for highways, tions. At that point, the president announced $250 million for low-cost housing, and lesser a $5.3 billion reduction in federal programs, amounts for agricultural loans, flood control permitting more than a $3 billion reduction projects, and education grants (Johnson, for the remaining seven months of the fiscal 1967: 219, 357). year. The major items affected included a In the fall of 1967, Congress considered a reduction of $1.1 billion in obligations under proposal to direct the president to cut spend. the highway trust fund, $750 million with ing by $5 billion. Central to the debate was held from housing and urban development, the question of who should be made responand sizable cutbacks in the Departments of sible for reducing the budget: Congress or Health, Education, and Welfare, Agriculture, the president. The House voted to transfer Interior, and in education funds for thic Ele- this responsibility to the president, but the mentary and Secondary Education Act. Scnate refused to agree to the $5 billion About half of these reductions represented mandatory reduction. Between late October deferrals rather than outright cancellations and December 6, Ilouse and Senate conferees (U.S. Congress, 1967c: 13-14; Johnson, 1966: mct six times in search of a compromise 1406-10).
solution, but to no avail. The conference reWhen asked to identify the legal authority port attributed the difficulty to the extremely for withholding highwav trust funds, Budget complex and controversial nature of broad Director Schultze replied that "basically it reduction propositions" and the Administrais thc general power of the President to tion's pending tax surcharge proposal (U.S. operate for the welfare of the cconomy and Congress, 1967c: 4). On the basis of an acthe Nation in terms of combating inflationary ccptable budget-cutting formula proposed by pressures." He also pointed out that highway the Administration, Congress directed a