Line-Item Veto Is No Quick-Fix

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How do you solve a problem like massive spending? From time immemorial, the Republican Party has answered, “with a line-item veto!” Supposedly, if we give the president the right knife, he can go through appropriations bills line by line, slicing out the fat.

At the recent House GOP retreat in Baltimore, budget hawk Rep. Paul Ryan, R-Wis., offered the blade to Obama, in the form of an LIV bill Ryan co-sponsored with Sen. Russ Feingold, D-Wis.


Obama seemed receptive: “I don’t think there’s a president out there that wouldn’t love to have it.” “We want to give you that scalpel,” Ryan affirmed.

Put that way, it sounds infomercial-wonderful. Who knew that with a simple bill you could make the government smaller?

Alas, like many infomercial promises, it’s not true. The LIV has been tried at both the state and the federal level. And the evidence suggests that it’s the ExtenZe of budgetary remedies.

There’s no quick fix for the fiscal catastrophe America’s facing. A majority of governors have enjoyed LIV authority for decades. And most of the scholars who’ve crunched the numbers have concluded that it’s hardly a magic pill.

Douglas Holtz-Eakin, John McCain 2008’s chief economic adviser, did one of the most comprehensive studies on what the state experience suggests about a federal LIV: It’s “unlikely to reduce the size of the federal government.”

A recent Federal Reserve journal article summarizes the state research: “There is no statistically significant effect on the budget in the long run.” Instead, the state LIV “simply alters the composition of spending.”

We ran the LIV experiment on the federal level in the 1990s, and the results were much the same. As my colleague John Samples notes in his new book, The Struggle for Limited Government, during the two years President Clinton had enhanced veto power, he cut under $2 billion from a multitrillion-dollar federal budget.

The Supreme Court stripped Clinton of that power in 1998, after Mayor Rudy Giuliani objected to the president’s lining out some NYC pork. The court held that the LIV threatened the separation of powers by altering the system the Framers set up for passing legislation.

The Ryan-Feingold proposal avoids that constitutional problem because it’s not a true LIV. Instead of giving the president the power to cancel appropriations, it merely allows him to identify, and withhold funds for, parts of appropriations bills he objects to.

The legislation then “fast-tracks” an up or down vote on the offending provisions. It would probably survive a constitutional challenge.

It’s nice that the latest incarnation of the line-item veto won’t further enhance the imperial president’s powers. But if the real thing didn’t curtail much spending, why should we expect “LIV Lite” to do any better?

We’d all like to have a mechanism to knock out earmarks. But bridges to nowhere aren’t breaking the bank. Our problems, as always, are entitlements and defense, which make up over two-thirds of the federal budget. Anyone who tells you different is trying to sell you something.

In fairness, Ryan is one of the few serious budget cutters in the GOP. His “Roadmap for America’s Future” would make real cuts in the entitlement programs that threaten to eat our future.

But even if Ryan isn’t looking to dodge hard choices, his LIV proposal empowers those who are.

Ryan’s Roadmap could put us on the path to fiscal sanity, but it demands serious political courage. His other proposal, the line-item veto, is a mere bandage on the body politic’s sucking chest wound. Which do you want to bet has a better chance of passing?

‘Gene Healy is a vice president at the Cato Institute and the author of The Cult of the Presidency.’