Line-Item Veto Will Be Wielded Clinton Use Of Unprecedented Power On Tax, Spend Items To Face Challenge
President Clinton will exercise the first line-item vetoes by an American president today in a historic step fraught with both legal and political perils.
Administration officials said on Sunday that the president had decided to reject some tax and spending items from the budget and tax measures he signed into law last week.
They would not disclose which items or how many, but Clinton skipped church services Sunday to ponder his pending vetoes, which he expects to be immediately challenged in court.
Rahm Emanuel, senior adviser to the president for policy, said on CBS’ “Face the Nation” that the vetoes would send the message to Americans of “no more business as usual” in Washington. On ABC, Treasury Secretary Robert Rubin said they would have a strong deterrent effect against passage of future special-interest legislation.
Emanuel said that the spending that Clinton chose to veto was evaluated for its economic and budgetary impacts and “didn’t meet our national interest.”
To build a strong case for a legal challenge that is likely to come, Clinton’s advisers had urged him to veto a spending measure rather than a tax cut. Some of his advisers had urged him to use his line-item veto on appropriations bills later in the year.
Presidents since Ulysses S. Grant in the 1870s have long sought the line-item veto, an authority held by many governors, so they can delete specific parts of spending bills without vetoing the entire legislation.
Such a law was passed last year by Republicans who had made the line-item veto a plank in the Contract with America, the 1994 campaign agenda, despite misgivings over giving such authority to a Democratic president.
And Clinton, eager to test the line-item power, decided to act now to strengthen his hand in future legislation and to make a strong political point that he will fight special interests.
But the administration’s tortuous deliberations in the last week have shown that one person’s boondoggle may be another person’s jobs program.
And since each of these measures is pushed by a particular member of Congress, there is the political calculation of whom the president is willing to irritate.
Critics of the line-item veto say that presidents could use it for their own political purposes, too. They say that governors with such authority have often used it to make deals with legislators.
Tax benefits subject to his line-item veto must affect fewer than 100 taxpayers, but the president by law has power to strike down any spending item, no matter how big. The balanced-budget bill contains some spending items, but many of them involve Medicare and welfare spending.
The president considered exercising his veto on 79 special interest tax breaks on everything from helping the hard-cider industry to Amtrak, but White House officials said many of them made sense and were good policy.
Sources who have been following Clinton’s decision-making said Sunday night they expected one of his targets to be a provision that gives an estimated $84 million in tax breaks over five years to food processors that sell their plants to qualified farm cooperatives. Congressional tax experts have estimated that roughly $60 million of this would be aimed at a single transaction: the sale of a Utah sugar beet refinery by a firm controlled by Harold Simmons, a Dallas-based billionaire.
Simmons, a Republican and leading contributor to GOP campaigns, including several members of the Senate, sold a refinery in Ogden, Utah, to Snake River Sugar Co., a cooperative of sugar beet farmers in Idaho, Oregon and Washington.
The tax break, which was supported by Senate Minority Leader Thomas A. Daschle, D-S.D., would enable such sales to be exempt from tax as long as the gains are reinvested in stocks.
xxxx A likely veto A tax break to benefit a single company allowed the sale of a business to be exempt from tax as long as the gains are reinvested in stocks. This allowed Texas billionaire, and GOP donor, Harold Simmons to sell a Utah sugar refinery to a cooperative of sugar beet farmers in Oregon, Idaho and Washington.