I'm flummoxed by Joe Biden's latest on the debt ceiling:
Mr. Biden said on Sunday that he believed he had the power to challenge the constitutionality of the nation’s borrowing limit, but that he did not believe such a challenge could succeed in time to avoid a default on federal debt if lawmakers did not raise the limit soon.
“I think we have the authority,” Mr. Biden said at a news conference in Hiroshima. “The question is could it be done and invoked in time.”
This makes it sound like Biden thinks he could go to court and get an advisory opinion or something related to the constitutionality of the debt ceiling. But courts don't do that. They rule only on live questions where the litigants can show actual real-world consequences.
Biden can certainly announce ahead of time that he plans to keep paying bills even after breaching the debt ceiling, but he has to actually do it before anyone can take him to court over it. At that point, he can keep paying bills until a court issues an injunction saying otherwise.
So what's all this business about whether his authority could be "invoked in time"? He's not doing anything to get the ball rolling anyway, nor can he for now. Does Biden think that once the ceiling is breached he has to wait for a court to affirmatively allow him to keep paying bills? That's crazy. As with any other executive action, you do it until a court affirmatively tells you to stop. What on earth am I missing here?
Please see President Biden's tweet on this today...and by the way, Sweet Lord, isn't his Twitter feed a sewer of viciously angry brain dead commentators....a very strange read...but President Biden is out there working on it...here is the plan:
https://twitter.com/POTUS/status/1660316196909072390
Did the embed work? I am obviously not good at posting long line links here with Kevin...still this is important so I try, Traveller (2nd try, first rejected by Mod Security....ok, this one went through...have fun)
Yes, it worked, as I was able to read Biden's twitter post.
Thanks, as I was unaware that he was posting on Twitter. What he posted seems like quite a good proposal, although I suspect virtually any elected Republican would STRONGLY disagree. They have been dissed!
It's a little too heavy on the revenue side for me. Yes, the Federal government needs to raise Revenues. But his total is $2.6 trillion, with only $275 billion in cuts. The ratio needs to be closer to 2 or 3 to 1, not 10 to 1.
You really can't take that much out of the economy in one bite. This proposal wouldn't even pass the Democratic portions of the House and Senate.
Trump's tax cuts worsened the deficit. Republicans ignore that completely, because they have been bought by the people who received those tax cuts.
White working class Trump supporters believe it too. Just try debating with them. The tax cuts were all good. The idea of them causing deficits and adding debt just does not register with them. I mean, if Trump did it, it's all good.
Trumpists are proving one of their deeply held beliefs: "Most people are too stupid or corrupt to vote."
Any one of those things will be a deal killer with the wingnuts, however rational they may be.
Can anyone explain what these supposed "handouts to big pharma" are?
Paying ten times the price for the same drug as that charged to Germany or Japan. Now, yes, since they have "government" systems that bargain for lower prices, and we have insurers or bargain for lower prices (and get them), we aren't really paying as much more as some claim.
But we do pay a lot more than most places.
Anybody notice that MoFo didn't reply?
WTF does any of that have to do with the debt ceiling?
It has to do with excessive and unnecessary federal spending. That is a component of our ever-increasing debt. It's bad enough we haven't the balls to collect more taxes from the wealthiest among us. But it's totally stupid to pay too much for what we have to buy.
You are missing politics. For now, Biden needs to explain how he is considering other alternatives to remedy the effects of breaching the debt limit, even if he believes that there is little to no chance that the limit will not be breached.
Biden is being the "good cop" here, holding the bad cops at bay until the crisis is upon us. Good politics, I think.
But Kevin, I think your analysis is correct. Biden does not need to invoke the 14th until he is sued for borrowing money in excess of the debt limit. Still, it helps to get people and the press used to the idea in advance of that eventuality.
The problem here is that the government literally does not have the legal ability to borrow in excess of the debt ceiling.
Any such debt is arguably null and void.
Would you buy Treasuries under such terms?
Congress authorizes the budget. If their taxation and spending do not align then Congress has implicitly authorized borrowing.
Oddly, neither does the President have the legal right to withhold, or even delay, expenditures authorized by Congressional appropriations, without specific approval from Congress. See https://democrats-budget.house.gov/resources/reports/impoundment-control-act-1974-what-it-why-does-it-matter
Yes, this is about making clear that violating the debt ceiling was a "last resort"--the least bad of several terrible options the House leadership forced upon the President.
I'm pessimistic. The Dems didn't raise the debt ceiling before Republicans took over the House, and Biden until recently demanded a clean raise, both I think counting on five Republicans to be sensible and not blow up the global economy just because they could. They were wrong. And now Trump weighed in and basically put a price on the head of every GOP legislator who doesn't give in to the tantrum crowd. They'll literally be scared for their lives.
As for the 14th, I think it's about investors. Who will buy bonds if a next administration can nix them, and it's not even clear how the courts will rule?
I suspect this Supreme Court would rule borrowing beyond the debt limit illegal, and Biden suspects the same. The consequences of tens or hundreds of billions of dollars of sovereign debt being ruled unlawful are unknowable, but would surely be horrendously catastrophic for America. And Biden would rightly get the blame. In election year.
So he and Yellen use word salad to explain why he won't do it. The botttom line is Trump Republicans are determined to force a default sooner or later, because they believe Biden would get the blame for the consequences. Better to force the confrontation now than next year.
This is why he can't invoke it until after the deadline, then the whole burden for what happens next will fall on the Court's ruling.
This is exactly right. He needs to wait until the last second, so that the Court can't "pause" his action. Then let McCarthy take him to Court. Then any default that happens will be on McCarthy and the Court. Personally, I think the Court will rule that debt ceiling fights are non-justiciable. That keeps them from having to take the blame for any default.
And default wouldn't? Normal countries don't have debt limits.
I can't believe anyone thinks that a SCOTUS hellbent on overturning Chevron would rule that the executive branch can ignore the debt limit or use commemorative coin minting powers to finance massive debt. I think both are perfectly decent arguments/strategies, but not for this court. Although, whatever the odds, if he has to force them to rule on whether the US must default, he should.
(I'm also really pessimistic that McCarthy can keep his side in line to even make a deal. I see the Republican House caucus fracturing over this. Should be a mess.)
Democrats could have eliminated the debt ceiling or could have expanded the SCOTUS. Instead we're in this crisis. Thanks, Presidents Manchin and Sinema.
Agreed--it's been a century since we last had a 6-3 conservative majority on the Court, and back then the court was striking down laws against 18-hour workdays as unconstitutional infringement on an apparent "right to contract" between corporations and wage slaves. So we're in for a wild and very bumpy ride here.
"Democrats could have eliminated the debt ceiling or could have expanded the SCOTUS. Instead we're in this crisis. Thanks, Presidents Manchin and Sinema."
Agreed in part; sometimes it's easy to blame the grownups in the room for problems ("why did you let that drunken chimpanzee have a knife?!?") when we should be putting most of the blame on the crazies and terrorists in McCarthy's coalition ("Drunk chimps have no business wielding knives, and certainly shouldn't be voting on legislation . . .")
The Court is between a rock and a hard place. If the Court rules against ignoring the debt limit, some obligations must go unpaid. But allowing the Executive to pay some creditors and not others gives it a de facto line-item veto, which the Court has held to be unconstitutional. Certainly the conservatives would not want to give that power to a Democratic administration.
Well, I hope the lines itemed are in Ruby Red States. Does Alabama actually need "revenue sharing"? It sounds to me like they are pained, embarrassed and outraged every time a tranche of money comes from DC. Help them recover their dignity.
You know, better run countries actually allow their courts to give advisory rulings… perhaps because it’s better to know whether executive action is going to be upheld before it goes into effect and has to be dismantled again.
The Massachusetts Supreme Judicial Court actually will issue advisory opinions, but it's the only American court I know of that does.
It is silly gamesmanship by Biden. He is still under the illusion that there are 5 sane Republicans in the House that when faced with imminent collapse of the Western economies will vote in favor of a clean debt ceiling increase. However, threatening something which everybody knows that he isn't going to do and, if he did do it, could be done in a couple of minutes by signing an executive order isn't a very effective threat.
Why would there be any collapse?
Once we hit the debt ceiling, you roll over existing debt and pay interest.
Remaining cash coming in is spent based on priorities by executive branch.
Some appropriated money is not spent because you do not have enough.
One possible reason is what's likely to happen to valuations of US treasury debt. If buyers see bigger risk of not getting interest payments or of not getting their principal back, market rates will go higher. That will reduce the value of existing treasury debt, which is a significant capital base world-wide. Rising interest rates and resulting declining value of treasuries was a big factor in weakening Silicon Valley Bank, as an example. No telling how high rates might spike, but it isn't something people are anxious to play around with.
Don’t worry. As an anonymous poster on the internet, I’m sure MF holds degrees in international and governmental finance, as well as macroeconomics. No reason to doubt his assertion that “everything will be ok.”
Of course, silly me . . .
Spending by one is income for another; as true for government as for private parties. Government contracts for a lot of labor; if the bills aren’t paid, layoffs come quickly. If direct payments farm subsidies, tax refunds, etc.) are cut, that’s kicking more support out from under the economy. A recession is likely, and there will be no stabilizers such as enhanced UI to be had.
They will prioritize payments and thereby avoid a legal default. Yes, that will be a huge hardship on Federal contractors, military personnel and entitlement beneficiaries. Biden will get impeached by the House, but there are not 67 votes to convict in the Senate.
As millions of senior citizens (like me) fall into financial difficulty waiting for those Social Security checks the pressure on the House lunatics will mount and mount. Eventually they'll raise the limit and everyone will be paid.
It will take longer this time than before, but it will permanently remove this particular form of hostage taking from the Reactionaries' toolbox.
Not sure I'd agree with your optimistic conclusions that the Crazy Caucus will eventually give in and that this won't happen again, I have to say.
But your point about the deeper play to set up an impeachment vote is interesting to the point of "aha". It would force a senate trial that would eat up valuable judge-confirming floor time as well as go halfway toward evening up the score for the Orange God-King. And the method is so trumpian-- set up Biden in a situation where he'll have to violate one law or another no matter what he does. It's too devious and legalistic for the likes of Jordan or McCarthy, so I have to wonder whose fingerprints would be on the scaffolding.
"It's too devious and legalistic for the likes of Jordan or McCarthy, so I have to wonder whose fingerprints would be on the scaffolding."
Meh. It's also a course of action entirely consistent with the Republicans in the house being completely incompetent, so I'd tend to think that's the more likely cause. Generally speaking, in explaining bad actions, I tend to think that incompetence is far more likely than malice, which is in turn far more likely than devious supervillainry; I'm not sure that the current (entirely predictable!) clusterfuck warrants reevaluation of that hierarchy.
But yeah, wow, an impeachment could be in the offing. This stupid country.
Everyone won’t get paid. I worked for a small company with government contracts during the last shutdown. Federal employees get made whole; contract employees don’t. No way did my employer have the ability to pay us out of his own pocket; and there was a minimum period of unemployment before qualifying for UI, which is only a fractional replacement.
OK, so Federal contract employees won't get made whole. I'd honestly prefer that to taking away Food Stamps from millions of really poor people. I say that as a person who was a contract programmer / analyst then data modeler for twenty years, including two for the BLM. Spells of unemployment are part of the landscape. And UI starts after one week of no work, but of course you don't get the payment for two-and-a-half weeks.
If you want to avoid this particular pitfall of life as a Federal contractor, don't vote for the Reactionaries next time.
There already is a lawsuit, though not sure when hearings are scheduled...
https://thehill.com/homenews/4002251-debt-ceiling-biden-faces-legal-risks-financial-peril-with-14th-amendment/
There's no law nor constitutional principle being violated until the debt limit is hit--so nothing substantive can happen until then. In that case, Republicans can file with their favorite judge and ask for an injunction--then appeals all the way to the Supreme Court. In effect, invoking the 14th amendment means being in default for at least a few days while the injunction is in effect.
There's no law nor constitutional principle being violated until the debt limit is hit-
If we had a dependably sane and reasonable court, the slam dunk option would be to simply continue normal bond operations, citing the 14th amendment. But since we cannot depend on a reasonable Supreme Court ruling on that issue, we should, for the reason you cite, use the premium bond strategy.
It's possible five SC votes could be found to stop Treasury from selling premium bonds, but surely the odds are weaker than with a more blatant strategy (simply ignoring the debt ceiling law).
And who is going to stop Treasury from issuing the Premium Bonds? The Supreme Court can't arrest people. Sure, Congress could impeach Biden and Yellen, but there aren't 67 votes in the Senate to convict them.
And who is going to stop Treasury from issuing the Premium Bonds?
As I said. I believe such a policy is more legally robust. However, there's no need to "stop" Treasury in the (unlikely) scenario whereby the court rules against this option: investors obviously aren't going to buy worthless paper.
No, the government will not be "in default" if it pays the interest due on continuing bonds and returns the principal on those which expire. Everyone else is just a current liability. You aren't cast into bankruptcy because you fail to pay a few of your credit cards one terrible month. Sure, you get a LOT of nasty penalties and your interest rate soars. But you aren't bankrupt.
This is not a gov't shutdown....
There could be run on the dollar and we couldn't do anything to stop the devaluation.
Loss of confidence in T-bills, bonds, etc., would cause many people to dump them--and the US couldn't respond to buying them up to keep the market from collapsing. There goes people's IRA's, 401K's, etc.
Both of these will issues will reek havoc in foreign countries too. The dollar is the major reserve currency--and its role will drop, which will cost the US a ton of money, influence, power, etc.
So YOUR solution is for Biden to drop to his knees and unzip McCarthy then?
It’s far more consequential than that. Government employees furloughed, contract employees laid off, and no way to pay supplemental unemployment insurance. Small firms dependent on government as client/customer will go out of business. The U.S. has few enough ‘automatic stabilizers’ acting in economic downturns; most won’t be functional.
I just wonder about all the richie-rich folk who donate all the $$$ to Republicans. They can't possibly like any of this.
As long as the tax cuts and favorable court rulings against labor and government regulations keep rolling in, the Richie-rich folk will keep bankrolling Republicans.
Richie-rich folks aren't any smarter than the rest of the population (plenty of wealthy folks think that the US spends too much and that this is a hardball way to get spending cuts and more tax breaks while being oblivious to the catastrophe McCarthy et al are threatening). There is smart money out there, but the smart money is a tiny voice and may be self-delusional and ineffective anyway.
I mean, how much do you think that the MTG crowd listens smart money, let alone to dumb money or really anything other than their social media feed? And McCarthy has to listen to MTG . . .
I think I would want an advisory opinion on whether or not something can be litigated before it happens. In English common law, there is a Latin phrase "quia timet" which translates roughly as "because he fears". The quia timet doctrine allows you to seek an injunction if you can satisfy the court that the person you seek to enjoin is about to do something, or is likely to do something, that will result in irreparable harm to you.
Under that doctrine, I would think it would be quite possible to seek an injunction prohibiting the federal government from exceeding the debt limit, if the rather vexing issue of standing could be resolved.
Doesn’t matter if you think advisory court opinions should be issued. The federal court system doesn’t allow for them therefore they won’t be issued.
I was talking about an advisory opinion from a lawyer knowledgeable about procedure in the federal courts, not from a court. I find it hard to believe that quia timet injunctions are totally unavailable.
Unfortunately because the SCOTUS is run by maniacs you can't really say how they'd rule ahead of time.
I am a lawyer knowledgeable about procedure in the federal courts, and while (to be very, very clear) I do not represent you and am not offering legal advice, a quia timet injuction is totally unavailable here.
Always something going on in the UK,
https://twitter.com/NoContextBrits/status/1660201507667468290
Kevin, you must be feeling somewhat better to have 2 posts on the debt ceiling….
It seems to me that the administration could just endeavor to follow the rules as given, and (a) pay all debts as required by the 14th Amendment, and then (b) be faced with the question of whether (i) to pay for all other legally required things, borrowing as needed to do so, or (ii) to recognize the legally imposed debt limit and stop paying for legally required things once that limit is reached.
And (b)(i) and (b)(ii) are mutually exclusive, and there is no real guidance about what is to be done when one law says to do X and another law says you cannot borrow the money you need in order to do X.
So what do you do, or more importantly, what would a court direct you to do: what law would a court require that you violate?
Now, it could be that different laws -- including the debt limit law -- are cleverly written: the debt limit law might say something along the lines of "this law supersedes all other laws" (although I don't think a law can really say that: it's essentially saying, "the position of THIS Congress and THIS President outweighs any position of any other Congress and President," which cannot be done because every Congress and President has equal standing to every other), and other laws might say things like "only feed the poor as required by this law if there is money available for it without violating any other law."
But I don't think many laws are drafted or passed with an eye toward recognizing that Congress might be stupid enough not to raise the debt limit as needed.
It's actually pretty simple.
The Constitution says you cannot borrow beyond the debt ceiling.
Appropriations are mere laws.
The Constitution wins.
If the constitution wins, then the 14th amendment wins, because it is part of the constitution (amended).
Conversely, the debt ceiling loses, because it is merely legislation. From wikipedia:
Public Debt Acts
"In 1939, Congress instituted the first limit on total accumulated debt over all kinds of instruments. The debt ceiling, in which an aggregate limit is applied to nearly all federal debt, was substantially established by Public Debt Acts passed in 1939 and 1941 and subsequently amended."
“The Constitution says you cannot borrow beyond the debt ceiling.”
The constitution says nothing about the debt ceiling because it didn’t exist until the early 20th Century.
Nice try. Go fuck yourself.
The Constitution says you cannot borrow beyond the debt ceiling.
No the United States Constitution most certainly does not say the government "cannot borrow beyond the debt ceiling."
Treasury doesn't NEED to "borrow beyond the debt limit" if it prioritizes payment of interest to bondholders and principal to holders of maturing bonds. The rest of us can simply wait for our payments as a "current liability".
Those current liabilities become debts if not paid as they fall due.
No, they are unmet liabilities. They are not the same thing as actively sold coupon bonds. In any normal bankruptcy holders of such coupon bonds are given first call on the remaining assets of the defunct enterprise. This has been true since the dawn of corporate "personhood".
So clearly there is a huge body of laws stating that there is a fundamental difference between contractual bonded "debt" and unmet liabilities. Of course, since the Federal Government can't go "bankrupt" it's a distinction that will never be applied in any dissolution, but it is still a valid distinction backed by well over a hundred years of practice and that body of settled law.
Where in the Constitution is the Executive empowered to withhold expenditures authorized by Congressional appropriations?
The Constitution is silent on "the debt ceiling", MoFo. In the original version it says that Congress has the power to tax and borrow and that the President has to obey its decisions. The 14th Amendment -- which, like all adopted amendments -- is now a part of the Constitution added the text "The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned." in order to ensure that should the (then former) Confederate States gain control of Congress, they couldn't renege on the bonds sold to pursue the war.
There is NO reference in the Constitution to any limitation on the debt of the Government of the United States.
The debt ceiling as amended several times is a law passed by Congress and signed by the President
This is bang on: What the House GOP are threatening to do is to force the Executive branch to choose which of 4 illegal actions to take:
1. Allow default and thereby violate the plain intention of the 14th Amendment--and probably trigger a worldwide depression as the world's primary store of value (US Treasuries) suddenly become imminently "questionable."
2. Violate the Impoundment Control Act of 1974 (and, arguably, the separation of powers) by selectively withholding duly authorized appropriations--likely leading to an immediate recession due to the massive shortfall in aggregate demand.
3. Violate the debt ceiling by continuing to issue public debt to equal the difference between federal spending and receipts, as required by law, citing the 14th Amendment and (ideally) also the Impoundment Control Act as authority.
4. Continue authorized spending without additional debt issuance, and thereby violate the statute requiring the issuance of public debt to equal the difference between federal spending and receipts (citing the same authorities as in option #3).
If I thought the Federal Reserve would not, in a completely irrational ideological panic such as only central bankers seem capable of in emergencies, find a way to torpedo #4 it would be, by far, the least damaging alternative. In the real political world we inhabit, #3 is probably the least-bad option.
And of course Biden is correct to slow-walk the idea of doing anything like this. Given that there is almost certainly no agreement that the Speaker can get his caucus to support that would avert this outcome, it's where we will likely wind up, but when you are about to do something radical, out of sheer necessity, it's probably a good idea to bend every effort to make it obvious that you tried your level best to avoid it.
Markets are confidence games. Had he been rhetorically preparing since January the markets would be far more likely to shrug. Now we'll just get panic.
What about consols (bonds with no maturity date)? The Federal government issued these for decades, though I haven’t found if those were specifically authorized by Congress.
Biden is cut from the same cloth as Obama - who due to inexperience and hubris, and to his immense discredit, thought he could succeed with his Grand Bargain approach. That normalized debt ceiling hostage-taking and now we see Biden negotiating over it as well.
Biden should publicly call for Obama to come back and help solve the problem.
A few points about this situation:
* There are no good options. When one side apparently wants to use its purportedly legal powers to burn the world down, all of us have already lost. There isn’t much point to discussions about what Biden should or shouldn’t be doing. He’s forced to engage with terrorists and there is essentially no way to address their nihilism.
* This situation is 100% the fault of Republicans, and everyone should keep saying so. And, therefore …
* Any type of commentary, including this blog post, which acts as if Biden is supposed to have a legitimate option or an effective strategy is aiding and abetting the Republicans. Biden has no good options to choose from (see first point above). The only solution is for the terrorists to stop acting like terrorists. And the best way we can aid the DEMs and help restore sanity is to keep pointing that out.
OK, God.
This.
Also: part of me likes to think about a world in which Biden deals with the debt ceiling by slashing federal payments to congressional districts with republican representatives. No reason the part of the country that sends responsible leaders to congress should bear the brunt of the pain the crazies inflict . . .
Biden could conceivably be referring to the National Association of Government Employees lawsuit that's aimed at getting the debt limit declared unconstitutional. It was just entered on the 8th and has no chance of being litigated in the next 10 days.
OTOH, let's not forget the Eisenhower factor-- Ike used to go out and give the press some double-talk when he needed to. In this case Biden doesn't need clarity about what he'll do, he needs doubt. And he is keeping people off balance pretty effectively.
Am I wrong, doesn't the US Constitution override any laws? If this is so, it's not a question of which law to follow. It's a matter of following the Constitution.
Isn't this the whole reason cases are sent to the Supreme Court? To determine if laws are constitutional?
The constitution supersedes, yes, but there's never been a determination about the debt limit specifically. A determination would come from a ruling, and rulings can only come from cases or other court actions. But this particular suit is only two weeks old and there's no way for it to be the one that settles the question in time for the current drama. So IMO the administration is where ProbStat's first two paragraphs put it.
Constitutionality is one reason SCOTUS takes cases, and there are other reasons too.
Article I, Clause 1
The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States; *** To borrow Money on the credit of the United States; ***
Pretty crystal clear. The Executive Branch has no power to borrow without authorization by Congress. Not much to rule on.
It's nowhere near as clear as you suggest. There's a good argument that passing appropriation bills which can only be funded by new debt - as Congress did last December - is implicitly authorising the Treasury to incur said debt. As I said in my earlier comment, I expect this Supreme Court would reject that argument, but it's by no means an open and shut case.
Since the money is already appropriated by Congress, that debt is de facto authorized.
And you forgot about the 14th amendment, the one stating that the debt shall not be questioned. That's to keep Congress from reneging on the debt.
Don’t feed the troll. MF is a fucking moron not arguing in good faith.
"MF" says it all, doesn't it?
lol
I had supposed that was the intent behind the choice of that particular moniker.
Am I wrong, doesn't the US Constitution override any laws?
The constitution isn't a suicide pact. So in a sane polity there'd be zero question as to whether or not Treasury should continue normal bond operations without interruption, and pay the government's bills.
But we have no idea whether two of the GOP black robes would join the three liberals to uphold sanity. And the right is extremely skilled at ginning up justifications for their madness. Here's an argument highlighted by Ezra Klein in a recent column (he's quoting a right wing judge):
To normal people this reads like sophistry. But if 5 of the 6 Republicans on the court buy it, it doesn't matter what normal people believe.
Here's a link to the archived column: https://archive.ph/yV4to#selection-573.0-577.195
Orwell would be proud!
What does "invoking the 14th" look like? The whole crux of this issue, as golack says, is borrowing beyond the statutory limit, ie issuing government promissory notes in return for buyers' money-- it isn't about paying bills. So IMO it'll be a memo instructing the treasury secretary to proceed with a scheduled auction. It may propose a different mix of securities than scheduled, or less likely a new class of securities (not enough time to draw them up), but more likely leave details to the secretary's discretion.
There'll need to be several paragraphs justifying the instruction, and because they would essentially anticipate the administration's response to any lawsuit against the action, they'd need to be closely argued. It would be accompanied or followed in short order by a press conference and/or a national address from the Oval Office or something like that, and a wide-scale PR blitz. And events would roll from there. But no Olympian lightning bolts.
It's misleading to talk about "invoking the 14th", as if it's an extraordinary measure like removing a president by "invoking the 25th". In fact, the president wouldn't have to "invoke" anything. He would simply instruct the Treasurer to proceed to borrow money in the usual way, and respond to any challenges by saying the debt limit was an unconstitutional exercise of power and therefore invalid. But as I argued earlier in the thread, I don't believe Biden should run the awful risk that this Supreme Court would find him in error.
So instead, he should run the awful risk of crashing the economy?
If the economy crashes, let the Justices take responsibility for it.
"If the economy crashes, let the Justices take responsibility for it."
Yeah! Then during the next election, the voters will throw those robed bums out and elect a new slate of sane Justices! Oh wait.
FWIW, half of the country is unable to name a single SCOTUS justice, whereas almost everybody knows who "Biden" is.
What you're missing is the political theater aspect. If Biden comes in both guns blazing on constitutionality now, the Democrats take a serious hit. And don't say they wouldn't. Last time, a plurality blamed both parties.
But if he makes it seem like a difficult decision that he is trying to avoid, and then reluctantly has to do it on midnight of June whatever, that's more justifiable.
And it has the added benefit of finally blowing up this bullshit strategy. Republicans want to reduce spending? Then do it during appropriations. They don't want to do that because they'll lose the next election.
But if Congress has made an appropriation, it is unconstitutional for the executive to not spend the money Congress ordered. If Congress has not paid for the appropriation some other way, then debt is the only solution.
It is pretty clear Republicans want to destroy the social safety net but they want Democratic fingerprints on it. Hem and haw in public about the 14th amendment, and then go ahead with it. Dare the Supreme Court to take it on themselves to destroy the global economy. I'm 75% sure there are 5 people who don't want to do that.
Great post, until the last sentence. I'm sure that there are more than 5 people who don't want that, but none of them are Republican congresspeople.
It doesn't require 5 Republican congresspeople. It requires 5 Supreme Court justices. The Supreme Court is mostly in the pocket of the rich, not of the Maga crazies, and they don't care what Trump says.
This, Bart and Amy are still in touch with reality enough to side with Roberts and wymens.
Don’t forget Gorsuch, who is a reliable vote for corporations.
Like dspcole said above, looks like Kevin might be feeling a little better?
Really happy to see your posts, Mr Drum.
I actually think that there may well have been a justiciable issue which arose back in January when the debt limit was initially breeched. Sue McCarthy in his role as speaker for even threatening to question the validity of our debt. If the six assholes can read they will rule in favor of the country.
I cannot find any right or authority to default on debts already incurred by lawful appropriations. The House authorized them. It is responsible for raising revenue, and the validity of the country's debt shall not not be questioned, and the Constitution says so, and the Constitution is the supreme law of the land. Anything that doesn't fit in with that is at least suspect, and most likely invalid. That the validity of the debt ceiling has never been questioned is no proof of its constitutionality. So settle it now, or be forever uncertain.
If the House won't play ball, the Executive still must meet its mandate to spend what Congress appropriated and the President signed off on. Obviously the solution is to continue to borrow the funds under Executive authority, as per long-standing practice. Blowing up the global economy is not a solution. Just borrow it and let the chips fall.
I'm no lawyer, but I've found that when you explore law and come to a nonsensical and harmful conclusion, either you have made a mistake, or the legislators have. Where a sensible solution is implicit, the obligation is to pursue it.
Recently, SCOTUS created a carve-out of preemption. It closely aligns with the possibility of SCOTUS stepping in to preempt the consequences of a federal agency's action, given its direction to, on the surface, violate a different part of the Constitution.
I feel confident that a conservative SCOTUS would want to find a way to create another carve-out for preemptive lawsuits of this unique nature where the Executive branch issues an EO directing Treasury to ignore the debt ceiling. If that wasn't enough for you to cross the line, the EO could instruct Treasury to immediately switch reporting of total borrowing from daily to quarterly.
Biden ought to publicly use the threat of an EO (directing Treasury to ignore the debt ceiling, etc.) to make it look like he forced Republicans back to the table sooner than they wanted.
The framing of this silly spectacle is a victory for Republican extremists and others whose only goal appears to be arguing in bad faith (this includes many pretend centrists).
If liberal Democrats were doing something similar with demands for large tax increases, it would be framed as a stupid farce without legal standing. Dumb, dumb, dumb.
Well, let's look at what he actually said. From the transcript:
"I'm looking at the 14th Amendment is whether or not we have the authority - I think we have the authority - the question is could it be done and invoked in time that it could not would not be appealed and as a consequence pass the date in question and still the fall of the debt."
Yeah...I have no idea.
You know who else engaged in doubletalk blatherspeak? Greenspan. Of course, when he did it there was a whole lot of pushin' behind the narrative that it was because he was so much smarter than the rest of us. Just as much pushing, come to think of it, that when Biden does it it's because he's in menal decline.
Spot on!
My guess it's just messaging. If he goes the 14th Amendment route, it potentially does a very similar damage as a straight default. Government keeps paying bills, but a bunch of lawsuits get filed. If the SC rules against him, it's a de facto default while a new round of negotiations starts, and likely the Republicans feel like they have even more leverage. So his preference is not to go this route. BUT, he can't say that this isn't even a possibility, so it's messaging to hang on to that as a last minute way to stave off disaster without getting into procedural details. But yeah, he said it in a nonsense way, which is actually your point. When was Biden ever especially articulate and careful in how he says things the way that Obama was?
It seems to me that any holder of US government bonds would have standing to challenge the debt ceiling in court under the 14th amendment at any time. Essentially the mere existence of the debt ceiling "questions" the debt obligations of the government and thus violates that 14th amendment. It's a wonder to me that no one has done this.
An EO could direct Treasury to immediately issue new bonds that would easily push us past the current debt ceiling.
Just saying, I think your narrow view of how this could work is rather...err...narrow.
BTW, he made the point, and continues to hammer the point today on social media and in the news, that if Republicans are serious about cutting the deficit, we need to increase taxes.
Unlike Biden, I would -- modestly -- increase the taxes of everyone. If you think we have a deficit problem and therefore a debt problem, you should put skin in the game. The absolute least painful way to do this is to raise taxes, even modestly.
As we all know by now, the fiscal multiplier of a tax cut is significantly lower (or negative) than just spending and borrowing, particular on infrastructure/capital investments.
So, people either need to put up or shut up.
I completely agree. Just narrow the "bands" in the Income Tax and, possibly, the Standard Deduction. The Federal Government needs another two or three percent of GDP; it can't cut its way to solvency because its such a huge part of the economy.
Cuts=less economic activity=less tax revenue=bigger deficits=more accumulated debt.
Of COURSE, some programs need reform. But after nearly one hundred years of Keynesian economics and fights over an ever-growing "Safety Net", most of the fat (except corporate give-aways and Farm subsidies) in the Budget has been excised.