The Founders' Purse

Abstract

This Article addresses a grave originalist misstep in the new and impending war over the constitutionality of broad delegations of spending power to the executive branch. In an opening salvo, the U.S. Court of Appeals for the Fifth Circuit held that Congress unconstitutionally delegated its power of the purse to the Consumer Financial Protection Bureau. It supported this conclusion with an ambitious but highly selective originalist interpretation of Article I, Section 9’s Appropriations Clause. Once the U.S. Supreme Court had the benefit of a more complete historical record, it rejected the Fifth Circuit’s interpretation of the Appropriations Clause’s original public meaning by a 7-2 vote. This Article grounds the Supreme Court’s analysis in a broader historical background on the delegation of spending power. It also illustrates how judges’ selective analysis of history can distort the Founding generation’s understanding of separation of powers and the respective roles of the legislative and executive branches.

Originalist claims to constitutional limits on the duration, generality, and source of spending in laws passed by Congress have missed a critical body of contrary historical evidence introduced by this Article. First, records of the Constitutional Convention show that the delegates approved new and durable congressional revenue and spending powers to support the U.S. government and its credit while declining proposals for temporal limitations on Congress’s revenue and spending powers. Second, early Congresses repeatedly put these new and durable spending powers to use in laws that bypassed all three proffered limitations on duration, generality, and source of funding. To support U.S. credit while paying down the debt, the First Congress delegated to an agency known as the Sinking Fund Commission indefinite power to self-direct purchases of debt with a generous award that, in current terms, exceeds $400 billion. Within two years, the debt instruments purchased by the Commission generated a significant interest-based surplus, which Congress awarded to the Commission in a dedicated fund drawn outside of annual appropriations. To establish an affordable new federal government, early Congresses also funded a majority of federal officers, including core law enforcement officials and even a new agency, through independently directed fees that were paid by private parties and operated without temporal limits. This history shows that Article I, Section 9 means what it says and requires only that Congress authorize spending through “[a]ppropriations made by [l]aw.” Claims to a contrary understanding depend on a selective analysis that ignores key lessons of both text and history.  

Keywords: Appropriations Clause, Nondelegation Doctrine, Consumer Financial Protection Bureau, Originalism, Founding Era, Sinking Fund Commission, Alexander Hamilton, Separation of Powers, Constitutional Law, Administrative Law

JEL Classification: K23, K40