If they do it, they’ve just got to use it for the Super Bowl coin flip.
Really, all Obama has to do is stick to his guns and say he’s not going to negotiate and if the Republicans want an economic collapse, the blood will be on their hands.
Knowing Obama, he would compromise with the Republicans by putting Reagan’s face on the trillion dollar coin.
I think a Trillion Dollar [del]bill[/del] Coin is just as satisfyingly legal and acceptable as any other course the Executive could take if the debt limit fails to be raised. i.e. it’s still not very satisfying. Unless Congress provides guidance as to which programs they want the Executive to cut when the debt limit is reached, the President could face an attempted impeachment no matter what he does, because he’ll have to make an arbitrary decision which will defy previously passed legislation no matter what he does.
It won’t make all of our financial problems go away, or even most of them. It’ll make one specific financial problem go away, and that problem is the really simple and trivial one that many members of Congress are too stupid to understand how the rules of arithmetic work.
It’s fun to say that, but I don’t think that’s the real problem and not much is served by saying it is. Congress is aware we need to issue the debt, that’s why the House Republicans are gearing up with a fight over the debt ceiling. What I’d say the Republican far right is too stupid to understand is how governing works and that you have to compromise. Retiring House Republican Steve LaTourette talked about the specific problems of the new members of his caucus a few days ago.
He said in an interview with Molly Ball of the Atlantic:
and
So while it’s funny to say “they approved a budget and now don’t want to approve the debt they knew would have to be issued to fund it, tee hee, they don’t know arithmetic!” the truth is that’s patently untrue, they obviously know they have to issue the debt and they knew that when they approved the budget. They’re intentionally doing something stupid (fight over the debt ceiling) because they simply don’t know how to legislate or govern.
They’re fine on rhetoric and political ideology (not that I agree with their ideology, but fine, they have one and they are fairly consistent on it) but they have no experience and no capacity to govern or legislate. Basically no one told them it’s fine to say random shit to get elected, all 435 members of Congress do it, but when you step through those doors into the U.S. House of Representatives you need to wear the big boy pants, and most of the Tea Party Republicans refuse to do that.
A lot of the problem is they don’t understand the only way stuff has ever gotten done in the House. The House has 435 members, continuously running for election. The only way to platoon stuff through Congress starts with a strong Speaker and Majority Leader and then tight control of the committees and generally you have a lot of party loyalty. If members of your party bring something out of committee, you’re generally expected to vote for it.
We don’t have a parliamentary system, but historically the House was the closest thing in the American political system to a Westminster Parliament. It’s not that you never had individuals allowed to make conscience votes on issues they believe in where they are at odds with the party. But there was a general understanding that on issues relating to the fundamentals of government, when a deal was signed off on you got on board. If someone wanted to derail the Federal budget process, that was the Speaker’s call. If someone wanted to refuse to issue debt, that was the Speaker’s call. That’s not something, historically, random unaligned piss-ants in the majority party did on their own.
The Senate is the house of individualism and strong personalities, where the party bosses are sometimes weaker than individual long time Senators. (For example Harry Reid is probably the most powerful Senate Dem, but on some issues that won’t mean a lot, and in many things the most senior Senate Dems can carry more influence and weight than Reid himself.) Senators have to win state wide elections, and they get six year terms. A veteran Senator has his own intrinsic power base, and basically almost doesn’t need the party. Guys like Jeffords and Lieberman who have broke rank with their parties and continued to win elections demonstrate this. With statewide name recognition the party’s ability to punish you is far less. At the House level, recalcitrant caucus members are essentially supposed to be stripped of all power in the House and then the national party is supposed to support strong primary opponents next election. That should usually clip their balls.
Boehner’s greatest weakness is he has been far too reticent to do that, but he also has an unusually large number of caucus members who were not elected to govern, but to rabble rouse.
Trying to solve the problem of the debt ceiling with the trillion dollar coin is like trying to solve your brother’s gambling addiction by paying off one of his credit cards. Until Congress sees the debt ceiling as something they shouldn’t “solve” just by getting another credit card, all you’ve done is given them another trillion dollars to splurge.
I think they should mint it. Can’t you just see the caper movie?
Ha! You just know Soderbergh, Clooney, and pals have been waiting for a chance to do Ocean’s 14.
Grumman, you seem to be unclear on what the problem is. Are you talking about the problem of the debt, or the problem of the debt ceiling? The trillion-dollar coin is proposed as a solution to the problem of the debt ceiling (i.e., that Congress is simultaneously requiring and not allowing the government to take on more debt), but would do nothing (and is not designed to do anything) about the problem of the debt (which will need to be solved eventually, but not for a long time yet).
I’m having a hard time understanding this sentence. If they were aware that we need to issue the debt, wouldn’t that lead to them not gearing up for a fight against it?
But I think we’re agreeing that there’s a logical disconnect somewhere in what the Representatives are doing-- It’s just a question of where that disconnect is.
This isn’t just a debt we owe to ourselves. This is one we owe to other countries as well.
So we make a platinum trillion dollar coin, stick it in the treasury, pay China a trillion dollars…and then what? The money has to come from somewhere if we’re actually paying our debt with anything other than imaginary money. So if that’s the case, we’ll be a trillion dollars down. What then?
Part of the problem with the Tea Party types is they are not cohesive. But I’d say there are two trains of thought:
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The extremist “starve the beast types” certainly know new debt would have to be issued for the government to spend everything it says it would in the budget, because a deficit makes that more or less obvious to everyone. But they believe by refusing to sign off on a debt ceiling deal, they can force the Federal government to basically operate as if there was some sort of balanced budget amendment. Many services would be cut in perpetuity and the current debt would be paid down. Most government services would end. Extreme Tea Party types think the essential death of Federal services is a good thing.
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The less extremists, just simply believe they can get massive concessions in exchange for allowing the country to function, far out of proportion to the portion of government they control (basically a portion of the majority caucus in one house of the bicameral legislature, which is only one of three branches of the government.)
I find it highly unlikely any of them genuinely don’t understand that a budget with a projected deficit isn’t going to require issuing new debt. They have reasons for basically wanting to either stop that new debt from being issued (in the extreme sense) or they want to force the President to do a lot of stuff he’d never agree to do in order to get the money he needs to run the country.
Or do you think it more likely they actually don’t understand that deficit spending has to be accomplished by debt being issued?
There is probably a question somewhere as to why the budget was passed in the first place, if they were going to refuse to play ball why not refuse to play ball at the more logical stage in the process. I’m not really sure on that. Other than generally budgets include a lot of spending a lot of people even in the Tea Party want to see, whereas debt ceiling bills do not.
On rereading the thread: is the point simply that an obscure power given the Treasury to mint coins could in theory be used to bypass a congressional limit on debt? I.E., defuse the “debt limit” crisis by having a way around it? That makes more sense than thinking the Treasury could simply coin legal tender to pay off our debt.
ETA: even if it was technically within the Treasury’s power, it would almost certainly be held to be an abuse of the Treasury’s role in the government budget system.
Yes, Lumpy, that’s the point. It’s a legal loophole that would let the government pretend that the debt ceiling is higher, and thus bypass the whole brouhaha about raising it. It wouldn’t do anything else.
Well, I guess it’d give editorial cartoonists a treasure trove of material, too. Not sure what effect that would have on the economy.
Back to one of my original questions though…WOULD The President even consider doing it should it come down to the wire?
You would have to be an idiot to think the House Republicans won’t try to use the debt ceiling as leverage, and whatever you may think of Obama, he’s not an idiot. And yet he has emphatically stated that he “won’t play that game.”
So either he thinks that the House Republicans are suddenly going to stop being dicks (which contradicts the premise that he’s not an idiot), or he is planning some other way to negate their debt ceiling threat. And I don’t know of any other way to get around them than some variation of the trillion dollar coin.
It makes the problem of the debt worse, by knocking the chucks out from behind the wheels. The debt ceiling is supposed to be a deterrent so that Congress will actively try to avoid smashing into it, instead of just running full tilt at it and expecting it to get out of the way.
How’s that workin’ out?
You do realize that until the budget is actually balanced the debt ceiling will continually need to be increased?
Unless you believe that there can be put in place immediate spending cuts and/or tax increases of sufficient magnitude to balance the budget immediately, then you have to accept debt ceiling increases as a natural consequence of arithmetic.
Why would you say that?
The “point” of the debt ceiling is that Congress has separate processes in place that deal with money. One is approving spending one is approving taxes, and a third is approving borrowing to bridge the income from taxes to the approved spending.
In reality, the third one does not need to be a separate negotiation. If you want to manage your borrowing, manage your spending and your income. You don’t let both spending and income be mismatched then try to fix it by refusing to borrow the difference. Refusing to borrow the money needed to pay your bills doesn’t solve your spending or income problems, it just makes you bounce a bunch of checks.