The Presidential Compensation Clause

The President shall, at stated Times, receive for his Services, a Compensation, which shall neither be increased nor diminished during the Period for which he shall have been elected. . . .

—Kate Comerford Todd & Tara Helfman

Introduction

The Presidential Compensation Clause requires that the President receive “a Compensation” for his services that cannot be changed during “the Period for which he shall have been elected.” Although this clause may seem like a fairly anodyne provision, history shows that the clause acts as a vital safeguard of the separation of powers and our republican form of government. Two themes have emerged throughout its history: The clause safeguards the separation of powers by denying Congress any power to alter the compensation of a sitting President during his term in office, and it preserves the integrity of the Executive by preventing a sitting President from signing into law a pay raise that would take effect during his term in office.

History Before 1787

The principles underlying the Presidential Compensation Clause originated in the difficult relationship between local assemblies and royal governors in the American colonies. By the 1750s, each of the thirteen colonies was governed, at least nominally, by a governor who was appointed by and answerable to the king.¹ Even though they represented the executive power of the Crown, the royal governors were wholly dependent on colonial legislatures for appropriations, and these assemblies, elected by local voters, were not shy about using the power of the purse to impose their will on an unelected executive.² In some cases, they even withheld governors’ salaries when royal instructions conflicted with local interests.³ “Some Remedy must be found,” one royal official warned, “or the People will at last govern.”⁴ Thomas Pownall, a member of Parliament, observed that the “scepter is . . . reversed,” and “the officers of the crown [were] dependent on and governed by the [colonial] assemblies.”⁵

In 1766, Parliament attempted to reassert royal authority in the colonies. The Townshend Revenue Act imposed duties on goods imported into the colonies for the stated purpose of raising revenue “for the support of civil government” in America.⁶ Charles Townshend, the measure’s architect, argued that “[t]he salaries of governors and judges . . . must be made independent of their [colonial] assemblies.”⁷ The response in the colonies was fierce: This was a direct tax masquerading as a customs regulation, and Parliament had no authority to levy a direct tax on the colonies without their consent. Making matters even worse, as John Dickinson observed in Letters from a Farmer in Pennsylvania, the royal governors would now be paid with revenue raised without the consent of the governed.⁸ During the Revolutionary Era, the question of executive compensation was bound up with colonial demands for self-government, political representation, and political accountability.

After independence, state constitutions established chief executives elected either directly by the voters or indirectly by the state legislatures. Some of these constitutions expressly provided for executive compensation. In Delaware, Virginia, and North Carolina, the executive’s salary had to be “adequate.”⁹ The South Carolina constitution specified 9,000 pounds per annum.¹⁰ Other constitutions were silent on the matter. The Massachusetts constitution of 1776 reflected the lessons of the Colonial Era and foreshadowed the Executive framed by the Constitution of 1788. It instructed the state legislature to establish for the governor “an honorable stated salary, of a fixed and permanent value, amply sufficient” to serve three purposes: to preserve the governor’s independence from “the undue influence” of the legislature, to prevent his “private concerns” from distracting him from serving the common good, and to “maintain the dignity of the commonwealth in the character of its chief magistrate[.]”¹¹

The Constitutional Convention

From the very outset of the Constitutional Convention, the delegates agreed that the federal Executive, whatever its form, should receive a fixed salary from Congress. The Virginia Plan proposed a National Executive that would “receive punctually at stated times, a fixed compensation for the services rendered, in which no increase or diminution shall be made so as to affect the Magistracy, existing at the time[.]”¹² The New Jersey Plan incorporated the Virginia Plan’s Executive compensation provision almost verbatim even though the two proposals differed from each other in almost every other way.¹³ In fact, while proposals for the configuration of Executive power changed over the course of the Convention, the salary requirement remained more or less the same.¹⁴

The Committee of Detail reformulated the compensation clause in a way that echoed similar provisions in state constitutions: The President “shall, at stated Times, receive for his Services, a fixed Compensation, which shall neither be encreased nor diminished during his Continuance in Office.”¹⁵ The Committee of Style changed “during his Continuance in Office” to “during the period for which he shall have been elected.”¹⁶ Under this provision, a sitting President could not sign a bill that would increase his salary. However, it would be possible for a President who is re-elected to sign a bill that increases the compensation for his subsequent term.

Benjamin Franklin was the only delegate at the Convention who objected to allowing the Executive to receive a salary. In prepared remarks, he expressed concern that the temptation of both power and money would make the high office attractive to “the bold and the violent, the men of strong passions and indefatigable activity in their selfish pursuits.”¹⁷ “Making our posts of honor places of profit,” he explained, would “sow the seeds of contention, faction & tumult” and would “nourish the foetus of a King[.]”¹⁸ Instead, he argued, the office should be occupied by “wise and good men” actuated by “public spirit.”¹⁹ Franklin therefore moved to amend the text to provide that the Executive “shall receive no salary, stipend fee or reward whatsoever for their services.”²⁰ Alexander Hamilton seconded the motion “with the view . . . merely of bringing so respectable a proposition before the Committee.”²¹ The proposal was immediately tabled without debate.²²

The Ratification Debates

During the ratification debates, several opponents of the Constitution reiterated Franklin’s concerns, albeit far less eloquently. Cornelius, an Anti-Federalist from Massachusetts, warned that the President’s compensation was not “far below that of an European Monarch.”²³ In Federalist No. 73, Hamilton provided a full-throated defense of the Presidential Compensation Clause as a necessary safeguard of the separation of powers. Congress could not “weaken [the President’s] fortitude by operating upon his necessities, nor corrupt his integrity by appealing to his avarice.” Hamilton recognized that “a power over a man’s support, is a power over his will.” There may be some men who can resist this temptation, but “this stern virtue is the growth of few soils.” Hamilton added in Federalist No. 79 that Congress could not control the sitting President’s will because it could not raise or lower his salary or alter when he would be paid.

Early Practice

At the time, some state constitutions required “honorable,” “adequate,” “modest,” or even “amply sufficient” compensation for the executive. The Federal Constitution, however, simply required that the President’s compensation be “fixed” and provided at pre-stated intervals. The First Congress debated whether the President’s compensation should correspond to the style in which Congress wanted him to live or correspond to the value of his services.²⁴

President George Washington’s inaugural address further complicated the matter. He announced that he would “renounce every pecuniary compensation” for serving as President and instead asked Congress to provide funds to cover “such actual expenditures as the public good may be thought to require.”²⁵ Congress declined Washington’s gesture on the ground that the Presidential Compensation Clause imposed a clear duty on Congress to fix the President’s compensation.²⁶

Ultimately, Congress settled on an annual salary of $25,000, to be paid quarterly.²⁷ (This amount would be about $900,000 in present-day value.) However, the statute did not address whether the President should be reimbursed for expenses associated with his service in office.

Applicable Legislation

The President’s salary has been adjusted only five times since 1790. It was increased to $50,000 in 1873, $75,000 in 1909, $100,000 in 1949, $200,000 in 1969, and $400,000 in 1999.²⁸ The increase of 1873 was enacted on March 3, 1873, and went into effect the following day when Ulysses S. Grant was sworn in for his second term.²⁹ The increase of 1949 was enacted on January 19, 1949, and also went into effect the following day when Harry S. Truman was sworn in for his second term.³⁰

It could be argued that the plain text of the Presidential Compensation Clause prohibits a President from signing a pay raise into law on the eve of his own reinauguration. The clause uses the future perfect tense (“shall have been elected”), so the prohibition would appear to apply not only to the current term of a sitting President, but also to a second term to which he had been elected at the time of enactment. Whatever the case, the constitutionality of the Grant and Truman salary increases remains an open question, as the measures were not challenged in court.

The 1949 statute also established an annual allowance for the President of $50,000 “to assist in defraying expenses relating to or resulting from the discharge of his official duties.”³¹ The allowance is not included in the President’s gross income, and the President must return any unused amount to the federal government.³² While the allowance is not taxable, the President’s income is subject to the federal income tax.³³ This allowance has not been increased or decreased since its creation in 1949.

Open Questions

• The Presidential Compensation Clause provides for the President’s “compensation.” The Domestic Emoluments Clause prohibits the President from accepting certain “emoluments.” What is the difference between compensation and emoluments?
• Does the Constitution prohibit a presidential salary increase that is signed into law after the President is elected to a second, consecutive term but before the President is sworn in a second time?

1. Leonard W. Labaree, Royal Government in America: A Study of the British Colonial System Before 1783, at 179 (1958). ↩︎
2. Id. at 269–71. ↩︎
3. Edgar J. McManus & Tara Helfman, 1 Liberty and Union: A Constitutional History of the United States 23–25 (2014). ↩︎
4. Archibald Kennedy, An Essay on the Government of the Colonies (1752), in 2 Exploring the Bounds of Liberty: Political Writings of Colonial British America from the Glorious Revolution to the American Revolution 1286 (Jack P. Greene & Craig B. Yirush eds., 2018). ↩︎
5. Thomas Pownall, The Administration of the Colonies 47 (1764). ↩︎
6. 7 Geo. 3 c. 46. ↩︎
7. John Phillip Reid, Constitutional History of the American Revolution: The Authority to Tax 219 (1987). ↩︎
8. 1 The American Revolution: Writings from the Pamphlet Debate, 1764–1772, at 406, 464 (Gordon S. Wood ed., 2015). ↩︎
9. Del. Const. of 1776, art. VII; Va. Const. of 1776; N.C. Const. of 1776, art. XXI. ↩︎
10. S.C. Const. of 1776, art. XXXIV. ↩︎
11. Mass. Const. of 1776, art. 13. ↩︎
12. 1 Farrand’s 21. ↩︎
13. Id. at 244. ↩︎
14. 2 Farrand’s 61, 116, 132, 146, 185, 575, 599. ↩︎
15. Id. at 172. ↩︎
16. Id. at 599. ↩︎
17. Id. at 82. ↩︎
18. 1 Farrand’s 83. ↩︎
19. Id. at 85. ↩︎
20. Id. at 81. ↩︎
21. Id. at 85. ↩︎
22. Id. ↩︎
23. Storing 4.10.12. ↩︎
24. 1 Debates and Proceedings in the Congress of the United States 657–662 (Jul. 13, 1789). ↩︎
25. George Washington, First Inaugural Address (Apr. 30, 1789). ↩︎
26. Saikrishna Bangalore Prakash, Imperial from the Beginning: The Constitution of the Original Executive 54–56 (2015). ↩︎
27. Act of Sept. 24, 1789, 1 Stat. 72. ↩︎
28. Cong. Rsrch. Serv., RS20115, President of the United States: Compensation 3 (2012), https://perma.cc/BG3G-VX8B. James F. Vivian, The President’s Salary: A Study in Constitutional Declension, 1789–1990 (1993). ↩︎
29. 17 Stat. 485. ↩︎
30. Act of Jan. 19, 1949, c. 2, §1(a), 63 Stat. 4. ↩︎
31. Id. ↩︎
32. 3 U.S.C. § 102. ↩︎
33. Id. ↩︎