Not incidentally, who were these congressional titans complaining about? Presidents James Madison and James Monroe. Westmoreland continues:
The most obvious tactic was for Executive Branch officials to make contracts without already having the money from the Congress. If that happened, the Congress was backed into a corner: a commitment by the U.S. had already been made by the Executive, so the Congress felt it had to make the funds available because of some sense of a moral or good-faith obligation. This was called creating a “coercive deficiency.” In the early days, most of this appears to have been done by the military, but that may not be surprising since so much of the early Federal spending was for the military.
To take back its control of the spending power, the Congress passed laws just after the Civil War that made such actions illegal. The main one is the Antideficiency Act, which prohibits Executive Branch officials from obligating or spending money before it is given to them by the Congress. It also prohibits these officials from taking money given to them for one purpose and using it for another. There are civil and criminal penalties for violating the law, as well as extensive auditing and reporting requirements.
Westmoreland continues:
A version of this 19th Century statute is still the law. Agencies themselves, Inspectors General, and the Government Accountability Office (GAO) all look into potential violations, and they are found every year. Some of them are simple errors. Some are disputes over bookkeeping rules or over interpreting legislation. Some are relatively small. Others are in the hundreds of millions. In Fiscal 2012, GAO reported 20 violations — ranging from a $50,000 violation in the National Guard to an $800 million one by the SEC. Civil servants can be disciplined or fired for violating the law. They can be criminally prosecuted for a willful violation, although I don’t think anyone has ever been convicted.
The Act becomes especially significant when the Congress fails to provide appropriations. At that point, government employees are legally prohibited from spending money, because they haven’t been given any money to spend. So an agency head cannot authorize a government employee to come to work; that would be incurring a government obligation without having an appropriation. The law also prohibits accepting voluntary services for the government, so the agency head can’t even allow people to volunteer to do their jobs.