The question may be moot now that both the Treasury Department and the Federal Reserve have publicly stated they think the law does not allow for the minting of a $1 trillion platinum coin to avoid a debt ceiling crisis, but it’s still worth reading the always-worth-reading billmon on the subject:
I’m against the coin because I think it’s a bad idea politically, and the main point to understand about the debt ceiling is that it is a political issue, not a legal or even a financial one.
This gets it exactly right, I think. And because this is fundamentally a political issue, public opinion matters. If President Obama is seen as playing games so the government can spend more money, or of engaging in a tit-for-tat battle with House Republicans (“If they’re going to be that way, so will I!”), he’ll lose public support—and probably pretty quickly.
If, on the other hand, the president continues to call on Congress to exercise its responsibilities and continues to be seen as treating the situation seriously and with dignity, then he’ll maintain the strong public support he currently enjoys. (Or, at least that’s what my admittedly somewhat foggy crystal ball projects.)
Even if a worst-case scenario plays out over the next few weeks and House Republicans unite in opposition to raising the debt ceiling to allow the president to pay the bills Congress already approved spending for, there’s no need for President Obama to resort to gimmicks like the $1 trillion coin.
“All the POTUS would have to do is call a press conference to announce that, after careful deliberation with his attorneys, he has decided that his inaugural oath to ensure the laws are faithfully executed requires him to ignore the debt ceiling, in order not to violate the more numerous laws duly passed by Congress that appropriate funds, award benefits, and mandate timely payment to federal creditors.
—[snip]—
To me, arguing that the POTUS is upholding the law as best he can in an impossible situation seems a better alternative to getting cute with the coinage laws. It is, after all, exactly the same argument used by Abraham Lincoln in the early months of the Civil War, after he usurped the congressional power to suspend habeas corpus:
‘Are all the laws but one to go unexecuted, and the government itself . . . to go to pieces, lest that one be violated?'”
I can think of lots worse situations for President Obama than giving a nationally televised address from the Oval Office giving Lincolnesque reaons (with Lincolnesque gravity) for his unilateral actions in upholding the “full faith and credit” of the United State government just days after (or before) Daniel Day-Lewis accepts his Academy Award for Best Actor.
Crossposted at: http://masscommons.wordpress.com/
