The Republican Presidential candidates are having a little spat about the line item veto, which Rudy as Mayor successfully sued to have struck down on constitutional separation of powers grounds. Attacked for this at the last debate, he took the extremely bizarre position - for a Republican Presidential candidate - that it actually matters whether something is constitutional or not.
By the way, I read about all this in newspapers and blogs. If there is one rule I live by, it is never to watch either Republican or Democratic Presidential candidate debates. Doctor's advice, or at least it would be if I asked him after properly laying out the facts.
Anyway, today McCain renewed the attack, although I think it started from Romney, saying that no true fiscal conservative could oppose the line item veto. And this is not necessarily a purely hypothetical debate, since conceivably clever structuring could create something rather like the line item veto that would withstand constitutional scrutiny. (Even leaving aside whether the "unitary executive" types on today's Court would vote differently.)
But one small problem here. As I point out in my recent book, Taxes, Spending, and the U.S. Government's March Toward Bankruptcy, it is theoretically ambiguous whether a line item veto will increase or decrease government spending, budget deficits, or the fiscal gap - whichever one chooses as the operative measure. It all depends on how the president uses it.
There are decent political economy arguments for the view that presidents will typically have a lower preference than members of Congress for lots of small handouts to this interest group or that. (Although Bush never minded earmarks or other pork until the first Wednesday of November 2006.) But presidents also tend to like really big-ticket projects - monuments to their "great leadership," perhaps - much more than do the members of Congress. This is pretty much a constant across presidents.
Give a president the line item veto, and while there is reason to think that anyone except for Bush from 2001-2006 will occasionally use it to lop off egregious handouts here and there, there is also reason to think that they will see it as a bargaining chip, the threat of which can help them win extra votes for the really big items they are struggling to press through.
So I think it is plausible that the line item veto would exacerbate rather than ease problems of fiscal discipline.
There may be some empirical evidence from the state level supporting the more conventional view. But there is a big difference between presidents and governors regarding the incentive to swing for the fences with really big "historic" programs.