Sinking Fund Commission

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The Sinking Fund Commission was a sinking fund commission that was created on August 12, 1790 by the United States Congress to control the disbursement of funds that Congress had already allocated to repay the national debt. [1] [2] The commission was composed of five members: the President of the Senate, the Secretary of State, the Chief Justice, the Secretary of the Treasury, and the Attorney General. The board members voted to make purchases of the national debt using surplus from import taxes. If at least three board members said yes, or if a majority if not all the board members were present, the President had to approve the purchase. [3] [4] [5] [6] [7] After a few years of existence, the Secretary of the Treasury started to make all the decisions. [8] [9] [10] For some time after that, the Secretary of the Treasury began making purchases without approval from the president, [11] and the disbanded in 1836. [12]

Independence

It is often described as America's first independent agency. [13] Law professor Christine Chabot and Eliga Gould reference the Sinking Fund Commission as an example of an independent executive agency with a similar structure to the Federal Reserve and its open market committee. with some commissioners, namely the Vice President of the United States and Chief Justice of the Supreme Court, not subject to the president's removal power. [14] [15] Other legal scholars have disputed the Sinking Fund's independence, referencing statutory provisions requiring presidential approval of the commission's decisions to purchase securities and the president's ability to remove a majority of its members, namely cabinet secretaries. [14]

References

  1. An act making provision for the reduction of public debt Pub. L.   1–47 , 1  Stat.   186-187 , enacted September 12, 1790
  2. "The Sinking Fund Precedent: An Originalist Defense of Regulatory Independence" . Retrieved August 22, 2025.
  3. "Page Headings - Annals of Congress" . Retrieved August 22, 2025.
  4. "To Thomas Jefferson from Albert Gallatin, 24 March 1807" . Retrieved August 22, 2025.
  5. "Meeting of the Commissioners of the Sinking Fund, 18 December 1790" . Retrieved August 22, 2025.
  6. "Report of the Commissioners of the Sinking Fund, 21 December 1790" . Retrieved August 22, 2025.
  7. "Minutes of a Meeting of the Commissioners of the Sinking Fund, 27 August 1790" . Retrieved August 22, 2025.
  8. "Proceedings of the Sinking Fund Commissioners, 1 June 1796" . Retrieved August 22, 2025.
  9. "Proceedings of the Commissioners of the Sinking Fund, [7 June] 1802" . Retrieved August 22, 2025.
  10. "Report of the Commissioners of the Sinking Fund, [28 April 1806]" . Retrieved August 22, 2025.
  11. "Page Headings - Annals of Congress" . Retrieved August 22, 2025.
  12. "STATUTE-5-Pg115.pdf" (PDF). Retrieved August 22, 2025.
  13. "The Sinking Fund Precedent: An Originalist Defense of Regulatory Independence" . Retrieved August 22, 2025.
  14. 1 2 Chabot, Christine Kexel (2020-11-13). "Is the Federal Reserve Constitutional? An Originalist Argument for Independent Agencies". Notre Dame Law Review .
  15. Gould, Eliga (2025-03-10). "George Washington, a real estate investor and successful entrepreneur, knew the difference between running a business and running the government". The Conversation. Retrieved 2025-04-17. When it created a 'sinking fund' in 1790 to manage the national debt, Congress showed just how far it could constrain presidential power. Although the fund was part of the Treasury Department, whose secretary served at the president's pleasure, the commission that oversaw it served for fixed terms set by Congress. The president could neither remove them nor tell them what to do.