Who wants to enforce the debt ceiling and push the United States into default? Only the Republicans in Congress.
Who wants to have the president make the Hobson’s choice between violating the constitutional provision of the 14th Amendment, Section 4, that “the validity of the public debt should not be questioned” or breaching an arbitrary debt ceiling that would require him to default on the public debt for the first time in our history? Only the Republicans in Congress.
Who wants to see a plunge in the value of the dollar and a rise in borrowing costs for the government, to erase millions of jobs, trigger a recession, freeze retirement accounts, and nullify veterans’ benefits? Only the Republicans in Congress.
Treasury Secretary Janet Yellen warned lawmakers recently that the federal government could run short of money to pay its bills as early as June 1 unless the debt ceiling is raised soon.
Everyone in Washington is eyeing the looming debt ceiling crisis with great wariness. Senate Republican leader Mitch McConnell says the possibility of invoking the 14th Amendment to pay the nation’s debts, the debt ceiling notwithstanding, would be unconstitutional. He thinks that Biden’s “unconstitutionally acting without Congress is…not an option.” House Speaker Kevin McCarthy bragged that he passed a bill with the support of unhinged MAGA congressional powerhouse Marjorie Taylor Greene, by a vote of 217-215, dead on arrival, that would slash domestic programs across the board (the spending cuts are unspecified) and tighten work requirements for food stamps and Medicaid. It also would repeal Biden’s landmark clean energy initiatives and expand fossil fuel production. And it would increase the debt limit only into next year, tossing the next showdown into the height of the presidential campaign.
McConnell said that he would “continue to lend my support to the speaker,” repeating what he has been saying since January: “The Senate is not a relevant player at this time.”
And Donald Trump piled on, urging Republicans to let the government default if the Democrats don’t accept the unspecified cuts. Of course, the House Republicans have failed to provide a budget. What “cuts” are they talking about? His solution is only political theater worthy of the Kabuki.
In October 1940, President Franklin Delano Roosevelt faced a reactionary group of Republicans in Congress who opposed his cash-and-carry bill, permitting shipments of armaments to Britain and the other nations at war with the Nazis.
The leaders of the opposition were Joseph Martin, a rock-ribbed Republican from Massachusetts who served 42 years in the House, four as speaker; Bruce Barton, a reactionary adman who founded BBDO, the advertising powerhouse; and Hamilton Fish III, hailing from upstate New York, a blue-blood patrician, who wore the Harvard “Pig,” the emblematic talisman of the elite Porcellian Club, chained to his navel. Fish was an unabashed Nazi sympathizer.
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FDR’s speechwriters, Robert E. Sherwood and Samuel Rosenman (incidentally, the father of Merrick Garland’s father-in-law), developed a “syncopated neologism” to ridicule the trio of obstructionists. “Martin, Barton, and Fish—a perfectly beautiful rhythm,” declared Roosevelt. The same could be said of McCarthy, McConnell, and Greene—the latter-day equivalents to Martin, Barton, and Fish, “a perfectly beautiful rhythm.” The familiar nursery rhyme “Wynken, Blynken and Nod” had the same cadence. It was written as a lullaby to put children to sleep.
The debt ceiling was created during World War One to facilitate the Treasury’s issuing new debt to finance the war effort without going to Congress for every tranche. It was intended to streamline borrowing, not to insure default.
Congress, in approving the latest budget, authorized expenditures that it knew could only be financed by borrowing.
Surely, approval of the expenditures in the budget would override the debt ceiling. Besides, would Congress ever have approved the parade of horribles consequent to a default? Default would erase millions of jobs, trigger a recession, freeze retirement accounts, increase borrowing costs, and devalue the dollar as the world’s reserve currency. And that’s just to state a few of the calamities that would come from a default that the Constitution expressly forbids.
The constitution provides that the president must “take care that the laws be faithfully executed.” Can Congress conceivably require the executive to spend money, and create debt to finance the expenditures, only to demand a separate limitation on the expenditures by defaulting on the debt so incurred?
If the Treasury refuses to pay debts lawfully incurred and approved by Congress, there would surely be litigation. The National Association of Government Employees has already filed an action in federal court. Massachusetts is seeking to require the government to honor its obligations. It is hard to see that any court would ever allow the United States to fleece its creditors in order to comply with a debt ceiling. Must the president choose between violating the law to pay government workers, as well as give their benefits to veterans and Social Security recipients, and violating the Constitution by stiffing the creditors who lent money to the government to finance the congressionally approved expenses?
Professor Laurence Tribe of Harvard Law School, who is leading the charge to invoke the 14th Amendment if Congress refuses to raise the debt ceiling in a clean bill that is agreeable to the administration, says that Biden would prevail in the Supreme Court if the case ever gets there. Indeed, it appears that the Republicans would not a have a legal leg to stand on.
“Standing” is a lawyer’s word for whether a plaintiff is an aggrieved party. The plaintiff must have standing for the court to have a “justiciable controversy” as required by the Constitution. If the government defaults, a bondholder would have standing to sue. But if the government pays its obligations when due, notwithstanding the debt ceiling, who would sue anyway? Would McCarthy, McConnell, or Greene have standing to sue Janet Yellen? Unlikely. It is unlikely that even this partisan Supreme Court would hear the case. Can it be conceivable that the courts will decide what the government may spend its money on? This is the constitutionally given exclusive power of Congress.
And even if there were standing, what would be the plaintiff’s argument? “Your honors, the president and the Treasury secretary are spending money that Congress said they are supposed to spend”? Horrors! Could any lawyer make such an argument with a straight face?
At the time of the original Constitution, Alexander Hamilton stated that the new government must pay its legally incurred debts.
It would appear that this value is more important than the Martin, Barton, and Fish–style political shenanigans of McCarthy, McConnell, and Greene.
