On the debt limit, Biden must learn to love the platinum coin

The United States is looking down the barrel Another possibility of default is self-imposed debt. Parliament now It is effectively led by the more deranged members of the Freedom Caucusopenly promising To take America’s full faith and credit hostage To extract huge concessions from President Joe Biden and his fellow Democrats.

the Serious consequences of defaults are well documented. US debt is practically the foundation of the global financial system. If the rest of the world doubts his credibility, a major recession, if not a devastating financial crisis, is likely.

Without the coin, the president is breaking the law one way or another.

However, there is one aspect of the debt limit issue that has gotten little coverage: It would be as illegal to comply with the limit as it would be to ignore it. If the Republicans refuse to raise the debt ceiling, they will put the president in a quandary: demand that he spend, but prevent him from borrowing the necessary money. Biden will have no way out — unless he opts for the platinum coin loophole. Without the coin, the president is breaking the law one way or another. It is difficult to see why he chose the option that causes an economic crisis.

Let’s review the situation. Treasury Secretary Janet Yellen said That the administration will begin Thursday various accounting adjustments to avoid breaching the debt ceiling, but the tricks are expected to end as soon as June. Republicans have not agreed on a set of ransom demands for the global economy, however Some mentioned hardcore Cut spending by $1 for every new dollar of debt, cut spending to fiscal 2022 levels, eliminate new funding for the IRS, and roll back abortion rights. Meanwhile, the House GOP is reportedly working on a dossier Payment prioritization plan It would stop funding everything but interest payments on the national debt, Social Security, Medicare, veterans’ benefits, and the military.

Basically, they want Democrats to repeal all of their hard-won legislation from last year, or shut down what looks like a quarter of government — including “Medicaid, food safety inspections, border control and air traffic control,” According to the Washington Post – indefinitely. But any such measures would have to be passed by both Senate Democrats and Biden, both of whom agreed Refuse any concessions of control. Furthermore it, Experts agree That prioritizing payments would be logistically impossible, given the sheer volume of payments the government makes each day.

On the flip side, during the lame duck session, Congress passed a $1.7 trillion spending bill that keeps the government funded through September, which Biden did. signed into law on December 29. This is the legal obligation: Congress has instructed the executive branch to run the government at set spending levels through the end of the fiscal year, but now it refuses to give it the borrowing power necessary to carry out its own instructions.

If the debt ceiling is reached, and the coin is minted, Biden must choose which legal violation to commit.

All of this is why the famous platinum coin is Biden’s most egregious legal defense option, as absurd as it may seem. 1997 Act Granted clearly Treasurer Possibility of minting platinum coins any denomination, partly for the purpose of making a profit for the government by registering property. If Congress says the president should spend, he can’t borrow, however can Mint, the way is clear for those who cling to the law. Mint a trillion or two platinum coins, deposit them in the Federal Reserve, and problem solved. Economically, it would be almost identical to borrowing money, presumably at some point the cap could be raised and currency spending replaced by regular debt.

After the management attorney I don’t seem to agree. Yellen has He said so The currency is a “gimmick” that “endangers the independence of the Federal Reserve, and confuses monetary and fiscal policy.” This is a weak argument in context – it’s hard to see why the allegedly eroding trick (Too exaggerated) The independence of the Federal Reserve will be worse than financial Armageddon.

But in any case, it is very strange that both the administration and almost all of the mainstream media should treat the debt limit as a strict legal hurdle – but not give the same treatment to the spending law. “Once the government exhausts its extraordinary measures and runs out of cash, it will not be able to issue new debts,” he said. Alan Rappaport writes in The New York Times, as if it were an actual physical mechanism that would forcibly prevent new borrowing. Nowhere does it say that Biden will also break the law if he does not spend as ordered.

If the debt ceiling is reached, and the coin is minted, Biden must choose which legal violation to commit. Surely any sane person would choose the option that does not cause massive and completely useless harm to the global economy. This choice becomes even clearer when one considers that the debt ceiling itself is arguably unconstitutional under the Fourteenth Amendment, which states that, “The validity of the public debt of the United States, permitted by law…” shall not be questioned. like President Abraham Lincoln argued When Chief Justice Roger B.

Mostly House Republicans Vote to cancel the 2020 electioncompletely in bondage Law of lunatics. They are ignorant and disguised enough to blow up the global economy either so they can blame Biden or simply enjoy the resulting chaos and destruction. The idea that it could be a bipartisan vote like Senate Majority Leader Chuck Schumer, DNY, Call, is wishful thinking. It is very likely that something like the platinum coin was needed to ward off the catastrophe. Biden must steel himself to break the debt ceiling forever using his own power.

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