The line item veto allows a chief executive to go into a proposed budget and, instead of signing or vetoing the entire bill, strike a line through a program or two (or fifty) that go beyond the rational scope of a government budget. If you think bailing out GM is not the government's job, consider that the same government spent $100,000 on an Alabama Quail Trail and $50,000 on a tattoo removal program in San Luis Obispo County, California.
The line item veto was long the legislative darling of the conservative crowd, and in 1996, when the conservatives were in Congress, they gave this effective tool to President Clinton. The result was a savings of $2 billion over a five-year period. President Clinton, to his credit, did not abuse this power, using it only 82 times and no place where it was terribly controversial. There were talks of the president threatening some members of congress, such as Congressman Sonny Callahan (R-AL) being told that a program of his that was cut out would be put back into the budget if he gave the president support for an IMF funding project that the president supported. But those instances were few.
Clinton enjoyed this added power for two years until it was deemed unconstitutional in Clinton v. City of New York. It's an important and effective tool and the critics of the line item veto, Mayor Giuliani being one of the biggest, are not completely wrong when they question whether this is giving too much power to a president. Presidents cannot write legislation - they can only veto or approve. The line item veto, some say, allows the president to legislate.
Is it too much power? In times of economic uneasiness, perhaps this can help us move the economy in the right direction. All but a few governors have this ability. The new president's first 100 days will tell a lot about presidential powers. He doesn't have a line item veto, but he has a large enough majority to push through almost anything he wants. He may, for example, allow a national same-day voter registration, which would make it easier for interest groups to pack the voting booths with supporters, not unlike the way ACORN has been doing for years.
In the presidential campaign, Giuliani kept to his belief that the line item veto is too much power for a president. John McCain was a supporter, no shock there. Stephen Moore, director of Fiscal Studies at the Cato Institute (a conservative Washington think tank), said the following while testifying before congress about the line item veto; "President Clinton used the veto to eliminate funding for a $600,000 solar aquatic wastewater treatment demonstration project in Vermont; a $2 million Chena River dredging project in Fairbanks, Alaska, to benefit a single tour boat operator; a $1 million corporate welfare grant to the Carter County Montana Chamber of Commerce…"
No wonder these companies all feel as though the government will bail them out. We have not given them reason to think otherwise.