You may have heard about the White House's efforts, which are being challenged in the courts, to cancel $4.9 Billion in funding through a mechanism called the "Pocket Rescission". While many people might have never heard the term rescission, even fewer people were alive the last time a President used the "Pocket Rescission" process to cancel previously appropriated funds.

Let's start with what is a rescission?

This is a process by which the President or Congress, with the consent of the other branch, can remove the budget authority for previously budgeted, but unallocated government funds. In layman's terms, it is a way to not spend money in the way it was originally budgeted for, so long as it has not already been spent. When initiated by the President, the Administration must notify Congress of their desire not to spend the funds, which allows for a 45-day period where Congress reviews the request and votes to accept, reject, or revise the Administration's desired cancellation of budget authority. This is a process that was used by every President from Ford to Clinton.

What makes for a “pocket rescission”?

A “Pocket Rescission” is not a legal term and is something that is being litigated by the Administration at this point. It references a rescission request that is sent to Congress with less than 45 days left in the Federal Fiscal Year (FFY). The idea being that Congress can run out the clock on the FFY and not have to vote on the rescission request, effectively stopping the expenditure of those funds. This is due to the Federal Government’s budgeting process, where any unspent funds must be returned to the Treasury at the end of the FFY. However, just because Congress has 45 days to act, does not require that they take 45 days to act. If they had the political will, Congress could vote on this immediately to ensure enough time to implement the will of the two Chambers.

An interesting note.

Rescissions take only a simple majority to pass and can move quickly through the House and Senate, if there is the political will. However, the rescissions package from earlier this year took the full time to get passed and signed into law. There were changes to the President's request, as about $400 million in funding was restored for the PREPFAR program. 

What is in the recent rescission request?

With a total request to cancel $4.9 billion in funding, there is a lot to unpack here. This includes $3.2 billion from USAID development assistance programs, $393 million from the State Department’s peacekeeping activities, $322 million from the State Department’s democracy promotion fund, and over $444 million in other peacekeeping activities. 

What does this mean globally?

Of course, a lot is left to be written about the impact this will have on the world, both good and bad. The unintended consequences, as well as the intended ones, will take time to develop and morph.