The Basic Problem With 'Impoundment' Games
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2025-03-16 07:00 by Karl Denninger
in Fiscal Policy , 82 references Ignore this thread
The Basic Problem With 'Impoundment' Games
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Judges are starting to rule against Trump's cut-off of appropriated funds.

Note that there are multiple issues -- specifically two -- at play here:

  • Fraud vitiates all things.  Spending against an expired program is fraudulent, as is diversion outside of the terms of the appropriation by Congress no matter how it is done.  So, for example, if you have an appropriation for "Aid to Uganda for food assistance" and it is turned into a DIE-fest or one to promote "Queerness" or whatever that is fraud and not only can that money be withheld there is an actual obligation to withhold it and, to the extent it was misused in that fashion claw it back punitively from the various agencies and NGOs where it was sent and criminally prosecute those who diverted it and profited from said diversion.

  • However, after Nixon used impoundment to not spend appropriated funds that was removed from Presidential prerogative in 1974 by explicit law.  Is that act Constitutional?  Well it would certainly appear to be given that all spending bills must originate in the House per the Constitution so provided the spending occurs exactly as Congress directs, and in no other way, it would appear that there is no authority for the Executive to refuse.  But is there?  For example, can Congress appropriate $1 million for 1,000 hammers, with each "expected" to cost $1,000 -- and thus compel the Executive to use a vendor that charges that much if there is another vendor that will sell equivalent-quality hammers for $20?  This is a question that, thus far, appears to be one of first impression and thus if the Executive does that I'd argue forcing them to overpay is equivalent to demanding forced theft from the taxpayer and we're back to fraud which, again, vitiates all things.

What this means, however, is that Congress (all 535 of them) and all their family members, especially considering how many of them have "side gigs" collecting these funds through NGO channels which explicitly violate the letter of the appropriation and do so with full knowledge and intent need to be held to account, both from a criminal perspective when family members are involved under the first bullet point and if the overspending does not immediately stop as pertains to the deficit then when civilization comes apart they must ALL be eaten FIRST.

To the first point, however, elements in our current economic structure like PBMs which explicitly lie are not shielded by any measure of statute; you cannot legislate the legality of fraud and a misrepresentation for the purpose of profit to the detriment of someone else is the definition of fraud.

Further, refusal to comply with the document demands whether via subpoena or otherwise in oversight processes is obstruction of justice and if the intent (and ultimate discovery) is that of obscuring fraud, and I remind you that obstruction of justice is a serious criminal felony for each and every person involved there is no official immunity either.  Indeed it is in the context of government officials where obstruction of justice is most-often both practiced and discovered.

So to the extent that DOGE (or anyone else), for example, can discover that a PBM is claiming that an $1,800 per month price for a drug is a "good deal" because the "actual retail price" is $2,000, when in fact people can and do buy the same drug for $60 a month in cash, said PBM is committing criminal fraud, attempting to hide behind the CMS rules that "the PBM's determination as to pricing is per-se validdoes not shield them, payment by CMS to such an entity is in fact fraudulent and thus irrespective of appropriated funds not only can be blocked it can and must be clawed back to the limit of the Statute of Limitations and every person and entity must be prosecuted for that act.

Likewise, if DOGE determines that $1,000 toilet seats are in fact no different than $50 ones sold at Home Depot to anyone who walks in the door, effectively creating fraud as a business model by dint of Congressional Appropriation I'd argue that appropriation is in fact for $50 seats and the additional funds are not lawfully appropriated and thus not only can be refused to be spent but must be refused and the vendor selling the $1,000 seats at 10,000% mark-up along with all who enabled that scam within the Government must be prosecuted and the funds expended thus far clawed back.

There are many such examples already known -- but in the broad sense the 50% increase in federal budget size since 2019 is entirely on Congress and if they won't cut that **** out right ****ing now, including Speaker Johnson, then I don't give a **** if any of them or any of their family members has horrible things happen to them and in fact will offer toasts if that occurs because they are deliberately destroying the United States and its capacity to continue as a nation for their own, and their friend's personal profit.

The debt problem originated in Congress, it resides there, and it remains there however to that point the President (Trump) has both the capacity and duty to issue a VETO on an attempt to pass another CR that maintains this level of spending but since Congress did and he didn't then **** him also as that act proves Trump is a fraud just as are all the members of Congress.