-by Helen Klein
As an older American citizen who views herself as rational, the horror of the showdown about raising the national debt ceiling seems to have reached an absurdity beyond belief. To many and perhaps most Americans, the issue sounds complicated, mostly thanks to the mainstream media for continuing to make it seem so, but in reality it is a super simple concept. Our country must pay our bills.
Everyone knows that when you borrow money, you get regular statements of what you owe and you pay the bills. This is the same for our country. Our government borrows money and must pay the bills when they come due. We have already borrowed this money and owe payment on this debt.
The current debt ceiling crisis has nothing to do with new borrowing, new spending or current programs. Of course, this is not what the Republicans want you to understand or believe. They are bullies and blackmailers who are using the debt ceiling to get what they want-- although at this point they don't even know what they want other than to hold the Democrats and the financial health of this country hostage for no clear purpose but because they can. At first they demanded cuts to Social Security and Medicare, but when TFG (The Former Guy-- I refuse to use his name) came out strongly against this, they dropped this demand. Now the MAGA Republicans in the House running this show do not even have any specific demands. They are just digging their heels in. They are threatening to hold up the bill in committee and refusing to allow a full vote on the House floor. The latter of course would make all House Republicans take a
stand and actually vote whether to default, something they would strongly prefer not to do, and probably (hopefully) would not do.
As virtually all Americans know, if you balk at paying your bills, you would be in deep financial trouble and the consequences can be enormous. Your credit rating would drop precipitously. You may lose your house, your car and other tangible assets. You would have great difficulty borrowing more money. By nonpayment, the interest rate would rise on your loans and thus make it even harder to pay
down your debt. You may face increasing debt for the rest of your life.
The bottom line: the USA must pay its bills. We must not default on our debt. The consequences would be severe for our country and devastating for the world. It would mean that the USA is no longer financially reliable.
So what is this threat that the Republicans have begun to use whenever a Democratic President is in office and it is necessary for the House to raise the debt limit ceiling? It is political theater. It is owning the libs. It is attempting to get concessions on current and future spending and programs if we want to pay the debt we already owe. This is debt that has already been authorized and legislated by Congress, by Republicans as well as Democrats.
In 2011, when Obama was in office, there was a similar showdown. At virtually the last minute, Congress approved raising the debt ceiling. However, by waiting so long to do so, our country's credit rating actually fell for the first time in history. The stock market dropped sharply and the cost of borrowing increased, with American tax payers having to pay for it. So just the threat of defaulting on
our debt cost us more money.
The fact that TFG and his administration ran up more debt in his time in office than any other time in our country's history-- due to the tax breaks provided to the corporations and the wealthiest people in the country-- has been way too buried by the media. At least 25% of the total debt accrued in more than two hundred years was brought about by TFG and the Republicans in just four years. Yes the Republicans are fine with enormous debt when it is a gift to the corporations and the rich, but now they are unwilling to pay for it. They are quite willing to sink our economy and our financial stability along with the rest of the world just to make the Democrats look bad. Why this is not front page headlines of the major news outlets is terrible in and of itself. The mainstream media is NOT doing its job about this. Thank you Bernie Sanders for at least making this critical point, and doing so often.
TFG's tax breaks and profligate ways and their implications for the country are described in a January 2021 article in ProPublica by Allan Sloan and Cezary Podku, entitled, [TFG] Built a National Debt So Big (Even Before the Pandemic)That It'll Weigh Down the Economy for Years. Here are a few excerpts:
One of (TFG's) lesser known but profoundly damaging legacies will be the explosive rise in the national debt. The financial burden that he's inflicted on our government will wreak havoc for decades, saddling our kids and grandkids with debt. The national debt has risen by almost $7.8 trillion during (TFG's) time in of ice. That's nearly twice as much as
Americans owe on student loans, car loans, credit cards and every other type of debt other than mortgages, combined, according to data from the Federal Reserve Bank of New York. It amounts to about $23,500 in new federal debt for every person in this country...
The growth in the annual deficit under (TFG) ranks as the third biggest increase, relative to the size of the economy, of any U.S. presidential administration...And unlike George W. Bush and Abraham Lincoln,who saw the larger relative increases in deficits, (TFG) did not launch two foreign conflicts or have to pay for a civil war.
Falling deeper into the red is the opposite of what (TFG), the self-styled “King of Debt,” said would happen if he became president. In a March 2016 interview with Bob Woodward and Robert Costa of the Washington Post, TFG said he could pay down the national debt, then about $19 trillion, “over a period of eight years.”
In July 2018, he told Sean Hannity of Fox News, “We have $21 trillion in debt. When this (the 2017 tax cut) really kicks in, we'll start paying of that debt like it's water.”
Oh my, what a shocker. TFG lied! Misled the public in spades.
As Adam Schiff stated, "Let's not overcomplicate this: The Republicans passed a $2 trillion tax cut for billionaires and corporations. And now they're refusing to pay for it. It's really that simple."
There are a variety of tricks being discussed by the Democrats, financial experts and the mainstream media on finding a way around the
House Republican's MAGA threats to refuse to raise the debt ceiling. Here are some examples offered by NPR.org:
1. The discharge petition (a clumsy, difficult-to-use procedural tool)-- this is a vehicle that forces a bill out of committee to a vote on the floor-- Lawrence O'Donnell has discussed this several times on his MSNBC show. This is difficult to accomplish and has been infrequently used with success
2. Payment prioritization-- avoiding default technically but then what? This would prioritize who gets paid first. This would still eventually result in default for some loans.
3. Minting a trillion dollar coin-- a gimmick that would leave investors spooked-- Janet Yellen has already stated the Treasury would not do so.
4. Invoking the Constitution-- legally questionable says NPR. I disagree but who am I?
As per Wikipedia, the law on the books that requires the House to routinely vote on raising the debt limit was passed over one hundred years ago during World War I.
Before 1917, the U.S. had no debt ceiling... The United States first instituted a statutory debt limit with the Secondary Limit Bond Act of 1917. This legislation sets limits of the aggregate amount of debt that could be accumulated through
individual categories of debt (such as bonds and bills). The debt ceiling is a legislative limit on the amount of national debt that can be incurred by the U.S. Treasury, thus limiting the amount of money the federal government may pay on the debt they already borrowed...In ef ect, it can only restrain the Treasury for paying for expenditures and other financial obligations after the limit has been reached, but which have already been approved (in the budget) and appropriated... Many scholars argue that the debt ceiling does not provide the legal authority for the United States to default on its debt.
Raising the debt ceiling was routinely passed by Congress and was not a political issue until somewhat recently. It has become a weapon of Republicans.
The 14th Amendment to the Constitution states:
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.
Here is an example from the Duke Law Journal on the clash between the the debt limit law and the Constitution. An edited summary of
the abstract is provided here.
The Debt Limit and the Constitution: How the Fourteenth Amendment Forbids Fiscal Obstructionism
-Jacob D. Charles
The statutory debt limit restricts the funds that can be borrowed to meet the government's financial obligations. On the other hand, the Fourteenth Amendment's Public Debt Clause mandates that all the government's financial obligations be met. This Note argues that the Public Debt Clause is violated when government actions create substantial doubt about the validity of the public debt, a standard that encompasses government actions that fall short of defaulting on or directly repudiating the public debt...This Note concludes that
Congress's actions during the 1995-96 and 2011 debt-limit debates violated the Public Defense Clause... And under a departmentalist understanding of executive power, a conclusion of this nature would be the basis for the president to
ignore the debt limit when congressional actions create unconstitutional doubt about the validity of the public debt.
Bing, bang, boom. This 1917 Act surely appears unconstitutional. In fact, from this legal scholar's point of view, even threats to default on our debt violate the Constitution.
So here are some thoughts as an American citizen who is by no means an expert on constitutional law: Why hasn't a case been brought before the Supreme Court about this early twentieth century law? Clearly (to me) this law should be thrown out the window, even with this right wing Court. Why aren't the Democrats even considering taking this route? Why isn't this even being brought up in a big way in the media as a way around the House Republicans?
As for NPR stating that it is unclear whetter the 1917 Act is unconstitutional (see above), it seems to me that the Democrats are afraid to put the pedal to the metal and test the Supreme Court. Would the Court really side with the view that it is okay for the country to default?
In my view, fear and refusing to address the unconstitutionality of this Act are poor excuses. Fight for heaven's sake. This horrendous state of affairs will continue ad nauseum into our future if we do not affirm that the U.S. is obligated to pay its debts. Even if we skate by this time, and that is in real doubt given the MAGA insanity, this issue will come up again and again and again if unresolved.
Just get rid of this arcane law. This would not only put a pin in the Republicans power balloon on the debt ceiling issue but would protect our country's financial stability for the future.
Furthermore, as stated in the abstract above, based on Constitutional principles the President can just ignore the debt limit. Is Biden considering this?
I would love to hear thoughts from Lawrence Tribe, Neal Katyal, Joyce Vance, Barbara McQuaid, Harry Litman, Andrew Weissmann, Glenn Kirschner, and Michael Luttig on this matter. Am I totally off base? (Please note that I am not asking for the opinions of John Eastman or Alina Habba.)