Suppose that the Republicans are actually willing to destroy the U.S. credit rating for the foreseeable future, and to plunge the U.S. and world economies into a severe depression, unless they get their way on various issues - these being, of course, issues that they either did not even dare raise in the 2012 election, or else raised but lost on.
Anyway, suppose that they do this - despite their continuing unwillingness to name the spending and entitlements cuts that they allegedly seek - and that the Obama Administration is at least considering not folding again. (What may happen is that the Republicans will decide to destroy the U.S. economy and credit rating unless OBAMA identifies the spending and entitlements cuts that they want, whereupon they will center the 2014 Congressional campaign on denouncing him for those cuts.)
What can the Administration unilaterally do, in order to prevent the global economic catastrophe that the Republicans are threatening to impose? There are already two legal theories out there: the 14th Amendment option, invoking presidential power to prevent questioning of the federal debt, and the "platinum coin" option, exploiting an apparent loophole within legal restrictions on the federal government's legal authority to pay bills by printing money.
I believe that these two options are plenty good enough under the circumstances, but the Obama Administration keeps saying that its lawyers don't buy them. One hopes that the Administration will rethink this if necessary, but let me just throw out an alternative constitutional argument. I do this tentatively or as a trial balloon since I am not a constitutional lawyer.
This is to exercise otherwise unconstitutional (by hypothesis) presidential emergency powers to prevent a national disaster. As Abraham Lincoln famously said, the Constitution is not a suicide pact. Now, he faced a much worse emergency, in the form of armed insurrection against the U.S. government, rather than a debt default. But on the other hand he was claiming the authority to exercise far more dangerous powers - suspending habeas corpus, which is a core constitutional liberty.
If President Obama asserted that the threat of default, loss of our credit rating, and catastrophic economic consequences empowered him to authorize further debt issuance, he would on the one hand be expanding the definition of "emergency" a bit, in a potentially dangerous way. But on the other hand he would be asserting it in favor of a very innocuous departure from federal law (under the assumption, which I consider false, that he does not have the power to act under the Fourteenth Amendment or via the platinum coin trick). All he would be doing is spending money that Congress authorized and indeed instructed him to spend, instead of allowing a disastrous federal default.
Constitutional law is shot through with "balancing" approaches of one kind and another. Can one argue for interpreting presidential emergency powers this way? The idea would be that this is a big enough national emergency to permit the unilateral exercise of presidential power to do something that is both innocuous (i.e., simply following spending laws on the books) and desperately necessary to our country's wellbeing, even though it isn't a big enough national emergency to authorize his making a bigger (i.e., actual) power grab.
Hi Dan,
ReplyDeleteI applaud all these efforts -- yours included -- at finding a constitutional work-around to the debt limit cliff. I'm also frightened by the Republicans' reckless willingness to use the debt limit as a bargaining chip. And, for that matter, the whole idea of a debt limit is silly: The national debat is simply the consequence of the combination of the federal budget and federal tax law. What's the point of a third legal constraint?
But.... Am I wrong to think that the real issue with the debt limit has less to do with the government's technical ability to borrow (though that's important) than with the reaction of world markets, rating agencies, and so on? Yes, the President might have the power to declare an emergency (or mint a platinum coin, or whatever) and he might even be vindicated eventually by the courts. But in the meantime, the full faith and credit of the United States will be in doubt, with consequences that can't be good. And even if he wins, the very fact that our system has proved itself so dysfunctional that he's been forced to resort to such measures will hurt our standing.
Of course, the other alternatives (negotiating with the extortionists or going over the debt cliff) aren't very good either.
Yes, Perry, that's entirely right. If the Treasury holds a bond auction, the Administration explains why it's legitimate, and the Congressional Republicans say it's not, then it's up to the bond markets to decide. And I think that's one of the issues that the Administration is worried about, although it doesn't necessarily explain their expressing legal skepticism about his powers.
ReplyDeleteThe fact the platinum coin trick is available actually limits the President's ability to assert emergency powers since he doesn't really have a necessity argument if he neglects to use his longstanding authority to mint coins. Remember when the Obama Admin went to the Supreme Court over the NLRB quorum issue?
ReplyDelete"NEAL KATYAL, DEPUTY SOLICITOR GENERAL: They were named in July of last year. They were voted out of committee in October. One of them had a hold and had to be renominated. That renomination took place. There was a failed quorum — a failed cloture vote in February. And so all three nominations are pending. And I think that underscores the general contentious nature of the appointment process with respect to this set of issues.
CHIEF JUSTICE ROBERTS: And the recess appointment power doesn’t work why?"
The Administration really doesn't need to hear Roberts say, "and the trillion dollar coin doesn't work why?"
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ReplyDelete