Heading for Another Cliff
With the recent crisis over the nonexistent “fiscal cliff” averted, the president and Congress seem inevitably headed toward another confrontation over the debt ceiling.
The Republicans, who inexplicably continue to be “led” by Cryin’ John Boehner, insist that they won’t allow the United States to borrow more money, even to pay its current outstanding bills, without an agreement to massive spending cuts.
The Obama administration, no doubt remembering that the last “deal” on the debt ceiling resulted in the very debacle we just went through, is saying, “No way. No deals. Do your job, raise the debt ceiling without conditions, the way you did without a negative word when there was a Republican president in office. Then we talk.”
If the debt ceiling doesn’t get raised, the mightiest nation in the world does what even a Third World banana republic should be ashamed to do: It goes into default. The government shuts down. So, with this disastrous showdown looming, some people have begun talking about an allegedly clever plan to save us, in the form of the Trillion Dollar Platinum Coin (or, as I call it, the TDPC).
Here’s how it would supposedly work: A federal law, 31 USC § 5112, allows the Treasury secretary to order the creation of platinum coins in any denomination. The law was originally meant to authorize commemorative coins, but it’s not specifically limited to those.
So, TDPC advocates say, the president should just order the secretary to mint a single platinum coin, declare it worth a trillion dollars, and deposit it in the Federal Reserve. Hey, presto! We’re solvent again, and we move on.
Sounds completely absurd, you may say, and you’d be right. But as a number of people, including Nobel Prize-winning economist Paul Krugman, have pointed out, what would be even more absurd would be to let the United States become the world’s largest deadbeat nation, able to pay its current outstanding bills but unwilling to do so.
Because, make no mistake, this isn’t about new spending; this is about Congress refusing to pay for spending it’s already authorized. As several writers have noted, it’s like a father declaring that the family’s run up too high a balance on the credit card, so he’s just not going to make the payments on the debt they have.
All that said, the TDPC raises some practical considerations that would need to be worked out. For one thing, how does one “deposit” a trillion dollar coin? Does the Treasury secretary just stick it in his front pocket and walk it down to the Federal Reserve? Does the Fed have tellers? Does he have to fill out a deposit slip? And hey, wouldn’t this be an open invitation to some supervillain to try to steal the coin?
Also, whose face goes on the TDPC? A number of folks have made suggestions: John Boehner; The President Who Must Not Be Named; and for some reason, swimmer Michael Phelps.
As for me, my choice would be late night TV host Stephen Colbert. No one, in my opinion, does a better job of saying ridiculous things with a straight face to make a point. And that is exactly what advocating the TDPC is: a ridiculous answer to a ridiculous impasse.
Some — not all — liberal commentators have urged the adoption of the TDPC, not least because of the possibility it would make John Boehner’s pumpkin-colored head explode. For its part, the Obama administration has shown no signs of actively considering this plan. Nor should it. It also shouldn’t bargain with the shrinking Teahadist caucus that wants once again to hold the U.S. economy hostage.
There’s a time and a place for discussions about spending, but it’s not at gunpoint. Congress needs to do its job and not send the country into actual bankruptcy today in the name of keeping it from going bankrupt tomorrow.
The last vote on the Senate’s fiscal cliff deal, arrived at after the House punted so disgracefully, showed that while there is still a crazy faction of the Republican Party willing to blow things up if they don’t get their way, it’s smaller than we originally thought. Some of them, thank goodness, will still vote not to wreck the country.
And if not — well, the wingnuts finally get what they want. A government that doesn’t spend money and does absolutely nothing for its citizens, one that’s so shrunken, in the words of wingnut icon Grover Norquist, that you could “drown it in a bathtub.”
Let’s see how much the people love them then, and how long before they realize they’ve overplayed their hand and they cave.
Call the bluff, Mr. President.
Dusty Rhoades lives, writes and practices law in Carthage. Contact him at email@example.com.
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