Coin Collectors

Kevin Drum throws some cold water on the platinum coin movement. (There’s a possible loophole in the coinage law that allows the Treasury to strike platinum coins of any denomination. We create a trillion dollar one, put it in our bank account, and presto, no issue with the debt ceiling.):

No particular restrictions were placed on the design or issuance of platinum coins, but this paragraph was plainly intended to apply to bullion and commemorative issues for coin collectors. That’s all.

There is, apparently, a widespread belief that courts will uphold a literal, hypertechnical reading of legislative language regardless of its obvious intent, but I’m quite certain this isn’t true. Courts are expected to rule based on the most sensible interpretation of a law, not its most tortured possible construction. I don’t think there’s even a remote chance that any court in the country would uphold a Treasury reading of this law that used it as a pretense for minting a $1 trillion coin.

Read the whole thing because, in context, it’s pretty clear that he’s probably right. My response is, yes, and so what? The court case that would result would take months to resolve, and it’s probably a big political win for Obama. At a the most common-sense level, people can see how stupid the whole debt ceiling hostage taking is, and with Congress’ popularity hovering between anal warts and communism, Obama’s use of a technicality to get out of a hostage crisis would make him look like a problem solver.

The President has said plainly and repeatedly that he isn’t going to have a debt ceiling fight. He’s been far more willing to issue executive orders to change immigration policy, for example. I haven’t seem any other way for Obama to use executive power to avoid the debt ceiling, so why not give this a shot. At a minimum, perhaps he can use it to drive a concession where the platinum coin power is modified and the debt ceiling is abolished, as Josh Barro recommends.






235 replies
  1. 1
    pillsy says:

    I don’t see why the courts would be so eager to jump into a fight between the Executive and Legislative branches, and after doing so, would make a ruling that means the US needs to default on its debt and thereby wreck the world economy. Congress has all the power it could possibly need to prevent the President from using the platinum coin dodge already.

  2. 2

    Making a trillion dollar coin would make Obama look stupid. It just looks too ridiculous.

    If he is going to take on a political fight that he might lose, he should just ignore Congress; make the statement that Congress gave him the power to borrow when they appropriated more money than the revenues would cover. He could then go ahead and borrow and just tell Congress to eff off.

    Stating that he had to act because Congress refused to pay bills they racked up would be far more popular.

  3. 3
    J.A.F. Rusty Shackleford says:

    “Courts are expected to rule based on the most sensible interpretation of a law, not its most tortured possible construction.”

    Too bad this doesn’t apply to the Constitution, specifically the second amendment.

  4. 4
    dr. bloor says:

    @pillsy:

    Congress has all the power it could possibly need to prevent the President from using the platinum coin dodge already.

    What would that be, exactly? If Obama mints a coin and tells Congress to bugger off, are they going to charge the WH with pitchforks and torches? Take away Obama’s checkbook? Any response they propose will take an extended period of time to see through to its conclusion.

  5. 5
    Baud says:

    If people are really concerned about leverage, they shouldn’t be suggesting gimmicks as a way around Congress doing it’s job.

  6. 6
    MattF says:

    Hasn’t Obama already ruled out the platinum coin trick? In any event, this is a political problem, not a legal problem– and I suspect that our ex-law professor President understands this. In particular, I’d guess he understands that treating the debt limit as a political problem is potentially a much bigger win for him.

  7. 7
    Ash Can says:

    @The Other Bob: I agree. The platinum coin bit seems much too gimmicky for Obama to plausibly use. I can much more easily see him come up with an on-paper technicality to end-run the Congressional clown show.

  8. 8
    azlib says:

    The problem is the uncertainty of how markets will react. If they say, “meh”, and continue to buy US debt, then no problem. So far the markets seem to not be worried about the debt. Take a look at T-Bill rates these days.

  9. 9
    artem1s says:

    while it may be entertaining to speculate on this type of solution, actual attempts at execution puts the user squarely in the ‘gold fringe flag’ and UN conspiracy, tin-foil-hat wearing black helicopter camp. No way do I want the President of the US staging such a stunt.

    It’s one thing to send a midget up to bat on Lady’s night to pick up an easy walk. You don’t do it in game 7 of the World Series.

    It belittles the efforts of actual, effective public servants. When you lie down with dogs….

  10. 10
    jibeaux says:

    Yeah, I just don’t see Obama trying to mint a trillion dollar coin or even threatening to. It just seems completely ridiculous. I think the most likely way that the debt ceiling thing plays out is that he refuses to discuss the issue, and if they press it, he issues an executive order that it violates the Constitution. Let them splutter.

  11. 11
    dr. bloor says:

    @Baud: More of a prop or even a macguffin than a gimmick, I’d say. You overestimate the intellectual heft of the press and the American public by suggesting that a visual aid isn’t necessary to get the point across.

  12. 12
    Count Ulster says:

    The courts engage in hyper-obtuse readings of the Second Amendment all the time. Why shouldn’t they be encouraged to do the same on this issue?

  13. 13
    Baud says:

    @dr. bloor:

    I thought the coin was intended to be real, not just a prop or a visual aid.

  14. 14
    Amir Khalid says:

    Bummer. That trillion-dollar coin would surely have earned a place in the Guinness Book of World Records as the most valuable piece of currency ever. (although, if I’m not mistaken, a few countries stricken with hyperinflation e.g. Weimar-Republic Germany and Zimbabwe have issued higher denomination notes.)

  15. 15
    Cacti says:

    As was suggested last night, just make sure these coins are struck with Ronald Reagan’s visage on the front.

  16. 16
    Schlemizel says:

    “The President has said plainly and repeatedly that he isn’t going to have a debt ceiling fight.”

    sorry to go all firebagger on you but the President also said plainly and repeatedly that people making less than $250k would not see their taxes go up. Yet if you look at your check you will see that your taxes did go up as a result of the ‘cliff’ deal.

    My guess is whatever President Obamas intent may be what actually is will be something other.

  17. 17
    Emma says:

    My preference would be for the President to act through executive orders and let Republicans take him to court or whatever.

    However, for the LULZ, I would love him to present Republican governors to a list of funding cuts in their states. “Here you go guys. Now, you want to talk to your representatives about it?”

  18. 18
    dmsilev says:

    @Amir Khalid: On the flip side, we’d be spared a whole slew of bad crime novels centering around various capers to steal the trillion-dollar coin.

    Though admittedly, it wouldn’t do the thieves much good. Most places won’t make change for anything over a $100 bill and even that is pushing it.

  19. 19
    Emma says:

    @Schlemizel: My taxes only went up because I had been getting a temporary tax cut which was instituted as an stimulus measure. Could you please stop lying about this already?

  20. 20
    Cassidy says:

    @dmsilev: Directed my Michael Bay, Starring Nicholas Cage and Shia Labeouf

  21. 21
    different-church-lady says:

    Please tell me you’re kidding.

    The court case that would result would take months to resolve, and it’s probably a big political win for Obama. At a the most common-sense level, people can see how stupid the whole debt ceiling hostage taking is…

    And they’d also see how stupid Obama is. Which is why it’s never going to happen — he’s not stupid.

  22. 22
    Napoleon says:

    If you pull in all kinds of other stuff then the plain language of the law then maybe Drum has a point, but the fact is the plain language of the law flat out gives the Treasury the right to mint that coin, with no ambiguity. So I don’t see why it is not legal. Courts (so I was told in law school) are to only go beyond the 4 corners of the law in question to other material if it is ambiguous.

    Plus by the time a court got to a decision (assuming that a court does not block the minting right of the bat while the case is pending) that voided the coin that decision would 1) be a court sticking its nose into an Executive Branch/Legislative Branch spat, which they do not like to do and 2) likely crash the economy, which tells me they would not void the coin.

  23. 23
    Napoleon says:

    @Ash Can:

    Well that would be the 14th Amendment option which the President, in a fit of proving he is incapable of negotiation out of a paper bag, already has said (or at least his admin has) that they don’t believe that the 14th amendment gives them that option. So he has already unilaterally disarmend on that issue.

  24. 24
    Schlemizel says:

    @Emma:

    Nobody is lying here – you or me. What the Prez says and what he can deliver are two different things.

    Blind faith it public statements by any pol except Grover have a very limited shelf life. If the goopers decide that they want a fight over the debt ceiling which of the two constitutionally risky counters do you thing BHO would employ? Perhaps you might also explain why you think he would act counter to his history of no drama while you are at it.

  25. 25
    ploeg says:

    What’s to stop the president from minting an arbitrary number of $10,000 platinum coins, and wouldn’t an arbitrary number of $10,000 platinum coins be as good of collateral as a single $1 trillion coin?

    @azlib: Spot on. The courts don’t matter as much as the people who buy the debt. It seems likely that we would have to pay a premium on debt that is backed by platinum coins, simply because investors will be uncertain about how hard it will be to get their money back, though this premium might not be very large.

  26. 26
    Chyron HR says:

    @Schlemizel:

    You guys would be a lot more convincing if you hadn’t also argued that the temporary payroll tax holiday was a “social security cut”.

  27. 27
    Napoleon says:

    @ploeg:

    ???

    If they mint the coin there is no need to go sell any debt. The coin is in liue of the debt, so you need not worry about what investors think (at least short term, if you mint those coins left and right as the economy comes back you may have an inflation problem down the road).

  28. 28
    Schlemizel says:

    @Chyron HR:

    Who is “you guys”? I never argued anything of the sort, I would never ever argue that the tax holiday was a social security cut in any manner. Please do not ascribe opinions to me that I have never held.

    My point is the same as it ever was; what the Prez says and what he can do are not always the same thing.

  29. 29
    jeffreyw says:

    The whole thing is bound up in the notion that money has an intrinsic worth, by definition. It doesn’t, any more than pebbles in a jar do.

  30. 30
    Emma says:

    @Schlemizel: What the Prez says and what he can deliver are two different things. No kidding. It’s called politics. After forty years of watching, I’ve figured it out. But that has nothing to do with the fact that whenever people say that my taxes are going up, they are skating past the reality that my taxes were artificially low to begin with.

    As to the debt ceiling, all the President has to do is sit tight and point at Congress every time someone screams. “The Congress approved spending this money. Now they refuse to pay the bills. It’s not we don’t have the money, it’s that they won’t let us spend it.” Meanwhile, I am sure he can issue some executive orders to cope with everyday expenses and let the Republicans take him to court or whatever. They might not like the result.

  31. 31
    sherparick says:

    And another possible, in fact almost likely outcome of such a court fight would be a finding that the Debt Ceiling Law is unconstitutional under both Article I and the 14th Amendment since Congress has already appropriated the money being spent and enforcing the law would cause void public debts already authorized by Congress.

    “In addition, it has been observed by many, such as legal scholar Garrett Epps, fiscal expert Bruce Bartlett and Treasury Secretary Timothy Geithner, that the debt ceiling itself may be unconstitutional and therefore void as long as it interferes with the duty of the government to pay interest on outstanding bonds and to make payments owed to pensioners (that is, Social Security recipients).[50][51]”

    http://en.wikipedia.org/wiki/F.....ublic_debt

    As described, in different ways, by both Norm Schreiber and Woodward, President Obama thought he would use the opportunity of the “debt ceiling” crisis in 2011 to forge a grand bargain. Because he shared Secretary Geithner’s neo-liberal economics, and is, as Bruce Bartlett has noted a “moderate Republican austerian” in his lack of comfort with and embarassment about Government deficits on his watch. The President, from his statement and actions, thought a “deal” would unleash the confidence “fairies” and take the “deficit” and the big, now reformed, entitlement programs off the polictical table. Sadly, no. For the Republicans they will never be off the table.

    Nevertheless, back in 2011 Obama did not want play the anti-debt ceiling cards nor be agressive Constitutionally since he wanted to play the game with the Republicans who he thought had the best interests of the country at heart. Sadly, no.

    Hopefully, he is serious that he does not want play the debt ceiling tango anymore. The President should simply tell Boehner, raise the debt ceiling or better yet repeal the law. If you don’t, I will do what is necessary to ensure that the full faith and credit of the United States is honored wiht all of its creditors.

  32. 32
    El Cid says:

    There is, apparently, a widespread belief that courts will uphold a literal, hypertechnical reading of legislative language regardless of its obvious intent, but I’m quite certain this isn’t true.

    The whole “well-regulated militia” part is just a bullshit prefatory phrase, but the rest of the 2nd Amendment is real.

  33. 33
    amk says:

    pure navel gazing exercise.

  34. 34
    thunderlizard says:

    This is seriously important:

    Even if courts would be inclined to disagree with a literal interpretation of the statute, NO ONE HAS STANDING TO PROTEST THE PLATINUM COIN OPTION.

    In order to sue over a platinum coin issue, you need to show DAMAGES. How has the platinum coin hurt you? “It caused inflation”? No court would accept that as standing, period. John Roberts, while he may be a right wing nut, wouldn’t accept that for half a heartbeat, nor would Kennedy.

    The only possible people who could claim damages are “owners of Treasury Bill credit default swaps,” that is, people who profit if the Federal government defaults on its debts. These are perhaps the least sympathetic petitioners. Except… because the 14th Amendment makes Treasury bills absolutely paramount even if the debt limit weren’t raised, we wouldn’t default, we would merely not pay our non-bond bills. Indeed, the language of the 14th amendment seems to explicitly prohibit the Court from even IMAGINING us defaulting.

    Bottom line is that even if this is a perverse reading of the law, no one has standing to object to it because the debt ceiling is a really, really stupid idea.

  35. 35
    Cassidy says:

    @amk: Has that ever stopped us?

  36. 36
    quannlace says:

    Treasury reading of this law that used it as a pretense for minting a $1 trillion coin.

    Wouldn’t work. Mr. Burns would only find a way to steal it, and then when Obama complains it’ll be ‘Release the hounds!’

  37. 37
    Alex S. says:

    @dmsilev:

    I think the Simpsons already did it:
    http://en.wikipedia.org/wiki/T....._Trillions

  38. 38
    Comrade Jake says:

    At a the most common-sense level, people can see how stupid the whole debt ceiling hostage taking is,

    I think most informed people realize this, but on average? I doubt it. My guess is that the average citizen has almost no clue as to what the debt ceiling really means. And let’s face it – the media hasn’t exactly done them a service here.

    If we had a media that did its job, there would be no debate over the debt ceiling.

  39. 39
    El Cid says:

    @quannlace: Clearly it should be a really, really big coin. 20 or 30 feet all at least.

  40. 40
    Gin & Tonic says:

    Meanwhile, out in the real world, people buy US bonds (generic usage here) for essentially nothing. The federal government borrows money for free. And people are happy to lend to it.

  41. 41
    Schlemizel says:

    @Emma:

    OK – so now you want to drag historic tax rates into the discussion? BHO did not promise anything on the historic levels front. Totally irrelevant.

    Your second paragraph is better but still unconvincing. We have all watched this President govern for 4 years and know something of his background. Yet some people expect that this time on this issue he will act in a way he has never acted before. Why would you do that?

    TO be clear I am not saying President Obama will not issue a coin or play the 14th but I would bet money against it because he has never shown that sort of high drama behavior in the past. Thats not necessarily a bad thing it just is. Hell he may have already gamed out some 11th dimension chess move that is no drama and actually eliminates the coming fight but nobody has offered any suggestions on what this will be.

    The fight is not always to the strong nor the race to the swift but that is the way to bet. Stop expecting magical ponies

  42. 42
    DougJ says:

    Even the liberal Kevin Drum.

  43. 43
    NCSteve says:

    Even though I’m a lawyer and agree with Drum’s analysis, there’s a simpler reason to think it’s a bad idea: if Yglesias, now truly at home home at the goto site for smug yet facile contrarianism, thinks its a good idea viable option, it’s suspect by definition.

    Update: (I see that Yglesias has now downgraded his opinion from “good idea” to “feasible yet silly” as of today.)

  44. 44
    Emma says:

    @Schlemizel: We have all watched this President govern for 4 years and know something of his background. Yet some people expect that this time on this issue he will act in a way he has never acted before. Why would you do that?

    It’s interesting, how we’ve watched the President and gotten different things from it. I watch what he’s gotten done.

    He has been, by all measures, the most successful Democratic president in my American lifetime. He has battled an increasingly insane Republican party and the pseudo-Democrats of his own and still managed to extend health care to millions of Americans, end one foreign war and begin the disengagement from another, keep the automotive industry in the United States alive… Well, I am sure if you’ve been watching, you know all of this. And yet, each time, EVERY TIME, there has been a crisis the same people have decided they know EXACTLY what he’s going to do and how he’s going to screw us. And I have yet to hear an apology when they’ve been wrong.

    And btw, “historical tax levels?” I can assure you, as a historian, something that happened less than ten years ago, doesn’t qualify.

  45. 45
    magurakurin says:

    @El Cid:

    Clearly it should be a really, really big coin.

    Or a really big check

    “They’re not really a sponsor. It just sounded professional”

  46. 46
    handsmile says:

    @Napoleon:

    “[Obama] has already unilaterally disarmed on that issue” [deploying the 14th Amendment to avoid the debt ceiling]

    Should debate on avoiding collision with the debt ceiling become intractable by say mid-February I would be very surprised if the Obama administration did not reconsider that issue. It’s my opinion that all of the President’s public statements are in effect negotiating positions. (We have a fresh vintage of this tactic in fiscal cliff negotiations.) Circumstances may well demand that Obama pick up this Constitutional weapon.

    On the platinum coin proposal, while what I have read thus far suggests clear Executive branch authority to do so, I’d agree with a number of earlier commenters that its novelty would be ridiculed and Obama savaged as a huckster. it would be an absolute feast for the jackals of the American corporate media.

  47. 47
    Steeplejack says:

    @Cacti:

    Put Reagan’s face on it and call it the “Ronnie.” Wolverines!

  48. 48
    ploeg says:

    @Napoleon: The demand to issue a $1 trillion platinum coin as circulating currency is extremely limited. Even if we owed any specific entity anything close to $1 trillion, that entity can’t accept it because you can’t do anything with a $1 trillion coin. (Just try asking for change for a $100 bill sometime. A $1 trillion coin would be 10,000,000,000 times as bad.)

    The entire point of the coin is to use the coin as collateral for loans. With interest rates as they are, it’s pretty close to minting cash for circulation anyway.

    Edit: And we’re not going to put a bunch of $10,000 coins in circulation either. They’ve already removed from circulation any bills over $100 to defeat money laundering, and they’re not going to open that hole up again by issuing big denomination coins.

  49. 49
    redshirt says:

    I’ve got some change in my pocket, going “jing-a-ling-aling”.

  50. 50
    Schlemizel says:

    @Emma:

    Did I ever say he was going to screw us? Please point out where I said that & I will immediately apologize. All I put out there is the fact that the President can SAY anything they chose to but delivering is something different.

    really don’t give a shit what you do for a living. You were the one that brought up historic levels that were irrelevant to my point. You still ignore my point to try and defend against a charge I never made.

    A bit touchy it seems.

  51. 51
    Amusing Alias says:

    While Drum is correct, the what the Pres can do is instruct the mint to strike 3 million platinum coins with a face value of $1 million each. With Reagan’s mug on one side collectors would eat them up.

    ‘Til now the argument has been about striking one, two, or three coins. That’s silly. Strike a bunch of coins and they are actually collectable.

  52. 52
    WarMunchkin says:

    Back in my day, Republicans extorted what they want by refusing to pass a budget.

  53. 53
    Hoodie says:

    The platinum coin thing ain’t gonna happen, mainly because the republicants aren’t going to shut down anything. We just saw 30+ republicant senators and 80+ republicant reps vote for a tax increase on rich people, for chrissakes, so it seems more than likely that they’ll bail on the debt ceiling and the sequester when push comes to shove, especially if Obama allows some of them to save face. They have limited leverage. The debt ceiling is like an atomic bomb — you can’t really use it as a tactical weapon. It’s value is purely symbolic, as a meaningless political gesture, like when Obama voted not to raise it when he was a senator. The real leverage they had was to deny revenue and immediate stimulus like UI, and they used that to get a 200k bump up in the top bracket and better terms on the estate tax and corporate goodies. All the bullshit about the debt ceiling and sequester is just media hype. The only real leverage they have now is in the sequester and their ongoing ability to control appropriations, but that is severely constrained. Obama will have to give something up there, but not a lot, since most of what he cares about is not in the sequester. Moreover, appropriations are problematic for the republicants, because they have to run again in two years and need pork for their own districts. McConnell and other republicant senators know the jig is up and that they need to regroup as a party, which is probably why we’re witnessing such a slobberfest for Christie from people like Scarborough. Christie’s a trial blimp for a new brand of Republican.

  54. 54
    Right/Left = Impulse/Thoughtfulness says:

    The Constitution explicitly states in Article 1 Section 8 that “The Congress shall have Power” … “To coin Money”, that power has been outsourced to the Fed which is under the Executive Branch.

    So, yes, Obama could have the Fed issue as many $1 TRILLION dollar coins to pay off as much debt as we incur as a country, how long anyone would buy our debt might be up for question, but not that the power doesn’t exist.

    So +1 for Kevin’s article on lead and -1 for Kevin’s outsourcing of his critical faculties and regurgitating Obama’s (and the right-wing’s) misunderstanding of the Constitution.

  55. 55
    droog says:

    I have said this elsewhere: Just mint a thousand, dinner plate-sized 1 billion dollar coins commemorating Congress’ failure to authorise the imprementation of its own budget. Etch an ourobouros on the edge of each coin to drive the point home. Heads will be one-of-a-kind for each coin (one for each House Rep and Senator, the rest go to prominent people involved in this matter like Obama, Norquist, Donald Trump, The Unabomber, Area Man, etc). On the tails side a reproduction of Obama’s birth certificate.

    If you need to commemorate something to comply with the spirit of the law just commemorate FAIL. That is how you win this thing.

  56. 56
    WereBear says:

    I love the idea of the trillion dollar coin which says “In yer face” to the Tea Party, but unfortunately it is a science fiction solution… and thus, untenable.

    It may be legal, but it is also ridiculous.

  57. 57
    Napoleon says:

    @handsmile:

    I hope your right in your second paragraph.

    As to your last paragraph, maybe, but it beats by a mile having to deal with the crazy caucus in Congress so its the best result he could get in the situation.

  58. 58
    Nylund says:

    We are talking about spending dictated by appropriations bills overwhelmingly supported by the GOP. You can see the roll call votes here:

    http://thomas.loc.gov/home/approp/app13.html

    This is money Obama is legally obligated to spend. Not only that, the Constitution dictates that the US must honor it’s debts. To refuse to raise the debt ceiling (or raise taxes) is to prevent the executive branch the ability to carry out the laws dictated by Congress and to follow the constitution.

    The GOP members in the House are threatening to make entirely contradictory legislation that makes it impossible for Obama to actually follow all the laws they’ve obligated him to follow.

    Someone needs to get on national TV and make that clear. It’s one thing to be really bad at governance. It’s entirely a different thing to make any form of governance legally impossible. That’s beyond bad, it’s a coordinated effort to undermine the government of the United States of America from within. The sick part is we taxpayers are paying them (and giving them great health insurance) to do it. We are actually paying them to make a mockery of our own Government.

  59. 59
    Napoleon says:

    @ploeg:

    The entire point of the coin is to use the coin as collateral for loans

    No it isn’t. The US Government has an account at the NY Fed. All it needs to do is deposit the coin and the Fed credits their account for $1,000,000,000.00. The US Gov can then wire transfer or write checks on the account. It really is that simple. No debt is involved.

  60. 60
    Emma says:

    @Schlemizel: Nice try, with the touchy accusation. Let’s review:

    1. you said the president had promised not to raise taxes on people making less than $250,000

    2. I said that they only reason my taxes had gone up under this deal was because it did away with the (recent and temporary) tax cut

    3. You then shifted the discussion to discussing the president’s negotiating style and what we could infer from it

    4. I pointed out that using that negotiating style he had achieved a great deal

    5. you then got all pissy because I said that something that happened less than 10 years ago in a temporary basis would not fall into the realm of “historic tax levels”

    Enough. Either we’re talking past each other or you’re refusing to address what I actually said OR to address the implications of what you said. I have other things to do today that require more attention.

  61. 61
    Belafon (formerly anonevent) says:

    Wouldn’t any coin only be worth what someone who accepts it values it at? We all agree that a dime, which is smaller than a nickle, is worth a dime basically because we all agree on this. Who is going to agree that a $1T coin is worth 1 trillion dollar bills?

  62. 62
    kindness says:

    While I read Kevin Drum daily and he is somewhat ‘sensible’ he’s also a bit of a pussy (please excuse my coloquialism). Kevin repeatedly acted like the ‘fiscal cliff’ was a terrible harbinger and also has repeatedly stated he feels cutting social welfare programs is fair game. Kevin isn’t DLC, he isn’t Third Way nor Fix The Debt but his views are far to close to those abominations than I can respect.

    I’ll read Kevin but along with Sully and several others, he is a point plot in the range of views, not one I feel anyone of us (or myself in particular) would or should emphasize. He might as well be the NPR contingent of progressive politics.

  63. 63
    kindness says:

    moderation? Why? I didn’t use any of the marked words. Oh, well maybe that one word…..

  64. 64
    lumpkin says:

    The president cannot refuse to spend money appropriated by congress or use it for other purposes.

    >>>Permitting the President to impound appropriated funds allowed him the power of item veto, which he does not have, and denied Congress the opportunity to override his veto of bills enacted by Congress.<<<

    So – he has been directed by congress to spend money already appropriated and the 14th amendment says he can't default on any debts. We have conflicting direction from congress on the spending side and clear direction from the constitution on the debt. Seems like it's the president's call as to which steps to take on the spending and he absolutely has to continue to service the debt and pay all bills as they come due. He should use his best judgment and explain it to the people in clear language.

    Couldn't get the link thingy to work. Here's the link to the citation on impoundment:
    http://law.justia.com/constitu.....funds.html

  65. 65
    General Stuck says:

    @Emma:

    1. you said the president had promised not to raise taxes on people making less than $250,000

    Our firebaggers have been screaming for years that Obama doesn’t negotiate right. So he starts with the 250 large threshold number, and we end up at 400/450 thou. While the wingnuts, and other dems in congress came out for a cutoff of 1 million for a tax cut. Given the math of what side gave up less of their original demand or bargaining position, Obama got the better of the wingnuts on that scale.

  66. 66
    Belafon (formerly anonevent) says:

    @lumpkin: That’s really where I think his power is. He can either choose to not spend some of the money, which the sadist in me hopes it would be in places that keep voting for Republicans (I live in Texas, btw), or that he says that he’s required to pay the bills.

    Misread your first sentence. I didn’t think he had the power to not spend.

  67. 67
    catclub says:

    @Schlemizel: “people making less than $250k would not see their taxes go up.”

    And since the change in FICA is zero relative to 2008, he has still kept that promise. He did not promise that ‘your taxes will only go down’.

  68. 68
    Fwiffo says:

    I still hope they mint the coin; I’ve got a design all ready.

  69. 69
    Steve says:

    Kevin is flat wrong here, even if he is right the law should be interpreted consistent with its spirit rather than its letter. What does he think the courts are going to do – issue an injunction prohibiting the Fed from treating the platinum coin as real money? Even if you can imagine that outcome, as was pointed out above, no one has standing to bring such a case.

  70. 70
    chopper says:

    @The Other Bob:

    it’s absolutely ridiculous, and moronic. likewise, minting a coin and depositing it so poof, there goes a trillion dollars in debt, would absolutely ruin the reputation of the dollar as a stable currency.

  71. 71
    Napoleon says:

    @Fwiffo:

    Personally I hope he puts Malcolm X on it, but Uncle Joe will do.

  72. 72
    xian says:

    @Emma: I know, right? Did Obama cave by letting taxes go up only on those making over $400k, couples over $450k (not true, of course, since deductions are limited at $200k for individuals, $250k for couples) or did he cave by letting taxes go up on those making under 200-250k (temporary stimulative payroll tax cut expiration)?

    Not to mention that true firebaggers were simultaneously against the payroll tax cut (it de-funds social security? wait, it doesn’t? then it blurs the line something thing…!) and against Obama allowing it to expire.

  73. 73
    PeakVT says:

    @Right/Left = Impulse/Thoughtfulness: that power has been outsourced to the Fed which is under the Executive Branch.

    No, it has been outsourced to the FRB, which is an independent body.

  74. 74
    Gin & Tonic says:

    @chopper:

    would absolutely ruin the reputation of the dollar as a stable currency

    Name an alternative.

  75. 75
    catclub says:

    I think Douglas Adams described coins that were 7 miles on a side. Also pobble beads. And ningis.

  76. 76
    Matt McIrvin says:

    There’s a saying I’ve heard: “you can’t hack the law.” Human laws are not like the operation of a computer program, executed by a deterministic system, which you can make do arbitrarily perverse things by finding the right loophole. Rather, what you can get away with is determined by some combination of received opinion and political/economic power and what people think is common sense. Right-wingers have gotten away with all kinds of weird procedural crap because they had either the public or the Washington media in their court when it happened.

    I don’t think Obama would get away with it if he tried subverting the debt ceiling through a clever-clever loophole. He might get away with it just by declaring it stupid and unconstitutional under Section 4 of the 14th Amendment, or maybe as an unreasonable self-restriction of Congress’s own powers under Article I of the Constitution. I don’t know if he’d be willing to do that.

  77. 77
    Culture of Truth says:

    Making a trillion dollar coin would make Obama look stupid

    Agreed, it’s stupid.

  78. 78
    General Stuck says:

    Given the icy resolve Obama has displayed on this issue, I think he has a contingency plan to deal with the nutters and their nihilism. It may well be something not obvious or part of the solutions talked about like the platinum coin or 14th amendment. But I’d bet the ranch he ain’t going to let the country default on its debt, to a degree that destroys the country, and world. You can think what you want.

  79. 79
    redshirt says:

    I want to see a trillion dollar Alf Pog. Make it happen Obama or you’ve failed me!

  80. 80
  81. 81
    Culture of Truth says:

    This is the kind of thing that might happen if a clever liberal blogger somehow got elected President.

  82. 82
    Napoleon says:

    @chopper:

    No it would not. You are implicitly adopting the logic of the deficit scolds Krugman and other have been flogging for years with how moronic they are. The Fed over the last 4 years have dumpped trillions and trillions into the system, which is the same thing as minting dozens of those coins, and rates have gone down and nothing has happened to the dollar.

  83. 83

    @Cacti:

    As was suggested last night, just make sure these coins are struck with Ronald Reagan’s visage on the front.

    This would be fitting, since most of our current fiscal problems were started by his administration.

    “This coin is legal tender to pay off Reagan’s Debts”.

  84. 84
    General Stuck says:

    @xian:

    LOL, nice

  85. 85
    NonyNony says:

    @Belafon (formerly anonevent):

    Who is going to agree that a $1T coin is worth 1 trillion dollar bills?

    If the Treasury says it’s worth a trillion dollars, then it’s worth a trillion dollars. Just like when they mint a dollar coin and say it’s worth a dollar, everyone agrees that it’s worth a dollar. Either you believe that the Federal government will back up its money or you don’t – if you do, then it doesn’t matter what denomination they put on the coin.

    Add to that that the only “customer” for this coin the Federal Reserve – who daily put out little pieces of paper with pictures on them that everyone agrees are worth anything from $1 to $100. If they’re told “this coin is worth a trillion dollars” they pretty much have to agree to honor it, since they know that it really isn’t about the coin itself, it’s about the weight of the Federal government behind the coin.

    It’s a stupid idea, but that isn’t why it is stupid.

  86. 86
    Culture of Truth says:

    Just issue $1 trillion in subway cards. This would also help with Sandy relief.

  87. 87
    Lurking Canadian says:

    I understand the 14th Ammendment argument, but I’ve never understood the “mint $1T” argument. If he can mint one trillion dollar coin, can he mint fourteen of them and in so doingretire the entire national debt all at once? The whole notion sounds to me like just repudiating T-bills, which is what the 14th A says he must not do. Can somebody explainit to me in small words?

  88. 88
    Right/Left = Impulse/Thoughtfulness says:

    PeakVT, noted, still:

    The Fed (& or the Treasury) has the power to create Trillion dollar coins.

    The ‘independence’ of the Fed is a separate discussion and whether Banksters should be in control of the Fed still another discussion…

    Obama’s reappointment of Republican President Bush’s Fed Chairman another discussion….

    Obama’s willingness to use any of his vast Presidential powers in any way that upsets Republicans still another….

  89. 89
  90. 90
    Culture of Truth says:

    Obama should pull a Cuban Missile Crisis and ignore Congress if they don’t raise the debt ceiling. Just keep writing checks and let them take him to court.

  91. 91
    NonyNony says:

    @General Stuck:

    I think he has a contingency plan to deal with the nutters and their nihilism. It may well be something not obvious or part of the solutions talked about like the platinum coin or 14th amendment. But I’d bet the ranch he ain’t going to let the country default on its debt

    Of course not. My guess is that he’ll do exactly what happened the last time this came up. Which is that he’ll shut down as much of the government as he needs to to pay the bills and tell everyone to call Congress to get them off their asses to re-open services.

    It’s not ideal, but a government shutdown is pretty much the only thing that the jokers in Congress understand. Considering that they actually voted for the spending that is pushing us over their stupid “debt ceiling” in the first place, they actually do get pushback when that funding spigot gets turned off. That’s the real leverage that Obama has – the fact that government spending is actually really popular in the real world, even if it is unpopular in the abstract.

    I don’t like it because it puts working people out of their jobs for no good reason other than a political stunt by a group of temper-tantrum throwing children. But it’s the way it will probably work in the real world – not with trillion dollar coins or 14th amendment showdowns.

  92. 92
    General Stuck says:

    If anyone thinks that PBO is going to hold up a shiny coin and tell the country our problems are solved, then they are dumber than fence posts. It would be the stupidest political move in American presnit history, regardless of technical legality.

    The wingnuts would squeal with glee, from being given a holy grail to flog Obama and tax and spend liberal clowns, based on some kind of doctored up funny money. Not going to happen. And I am surprised supposedly intelligent libs are promoting it.

  93. 93
    Napoleon says:

    @Lurking Canadian:

    The whole notion sounds to me like just repudiating T-bills,

    It is not. If you buy an IOU (which is what a T-Bill is) from a government in a currency issued by that government that is the risk you take, that the value of that IOU could be radically differant when the IOU comes due as a result of actions taken by the government relative to its currency.

    By the way, that is one of the reasons Europe is having such problems since many countries do not have currencies they issue and their debt is in a currency they do not control (the Euro). If they did they could solve their problems much more easily via currency actions.

  94. 94
    Ken says:

    Courts are expected to rule based on the most sensible interpretation of a law, not its most tortured possible construction.

    This only applies if interpretation is necessary. “Plain Meaning” is a long standing concept of American jurisprudence. If a law is written in such a way that no interpretation is necessary, then the job of the court is to enforce the law as written. If the wording of the statute is unambiguous, then the intent of the authors is irrelevant, no matter how much Kevin Drum wishes otherwise.

    “… the meaning of a statute must, in the first instance, be sought in the language in which the act is framed, and if that is plain, and if the law is within the constitutional authority of the lawmaking body which passed it, the sole function of the courts is to enforce it according to its terms… Where the language is plain and admits of no more than one meaning, the duty of interpretation does not arise, and the rules which are to aid doubtful meanings need no discussion” CAMINETTI v. U S

    And though I’m no lawyer, the wording of the statute is clear, simple, plain, and unambiguous:

    “The Secretary [of the Treasury] may mint and issue platinum bullion coins and proof platinum coins in accordance with such specifications, designs, varieties, quantities, denominations, and inscriptions as the Secretary, in the Secretary’s discretion, may prescribe from time to time.”

    So while there may be a lot of good reasons why this won’t happen, Kevin Drum’s insistence that the Courts must abide by the intent of the lawmakers is not one of them

  95. 95
    General Stuck says:

    @NonyNony:

    But it’s the way it will probably work in the real world – not with trillion dollar coins or 14th amendment showdowns.

    Agree. And the reason is BO is smart enough to know that a big part, or hope from the republicans with this kind of shit, is that it might cause Obama to do something dubious legally or politically that they can focus the wurlitzer on, and seize the nations attention, and maybe even create a plausible case for impeachment.

  96. 96
    CaseyL says:

    I think the $1T coin is a bad idea because it’s a bad precedent. Once it’s done, it can be done again… and again… by other Presidents; for any reason, or none… and *poof* there goes currency stability.

  97. 97
    El Caganer says:

    TDC is a fun idea, but 14th Amendment sounds a lot more practical.

  98. 98
    Napoleon says:

    @CaseyL:

    This is so backwards and wrong it is amazing.

    As it stands the Fed can issue new money on a whim, which is what they have been doing like drunks the last few years, with NO ILL EFFECT. The only time the government will issue coins is Congress fails to provide revenue (whether borrowing or taxes). They can keep Presidents from doing it by managing the budget of the US.

  99. 99
    chopper says:

    @Napoleon:

    name a time the fed has in one day dumped a trillion dollars into the system.

  100. 100
    Lojasmo says:

    @dr. bloor:

    Sternly worded letter.

  101. 101
    Emma says:

    @General Stuck: My feelings exactly. But will we ever get them to see it that way? HAH!

  102. 102
    Suffern ACE says:

    @chopper: minting the coin doesn’t eliminate the debt unless the treasury secretary calls in outstanding bonds, which would create its own problems. We don’t actually want those bonds and notes to disappear.

  103. 103
    Xenos says:

    @Ken: Even more fundamental is the question of justiciability. If the heart of the dispute is essentially a political question, and only resolved by political actors, the court is not supposed to take up the case.

  104. 104
    chopper says:

    @Suffern ACE:

    i also wonder how the oil market is going to view these sort of silly shenanigans, given that the fact that, by agreement, oil is traded in dollars is one of the great stabilizing forces for our currency.

    then again, same with a run up to default.

  105. 105
    Right/Left = Impulse/Thoughtfulness says:

    {facepalm}

    Republicans control the House which controls appropriations, which in simple terms: Republicans spend more money than they take in and then blame the Dems.

    SO: Republicans spend the money but refuse to pay the bills.

    What’s less absurd than that? Minting trillion dollar coins to pay for the debts Republicans incurred.

    What’s more absurd than that? Republican’s fiscal treason of risking America’s financial strength.

  106. 106
    Lojasmo says:

    @Schlemizel:

    But he SAID he wouldn’t do it, so now, according to your logic he will, AMIRITE?

    /trollface

  107. 107
    PeakVT says:

    @CaseyL: But it can only be done because of an easily plugged loophole (which may or may not exist, depending one’s interpretation of the law). If it is ever done, that loophole will be plugged for sure.

  108. 108
    Napoleon says:

    @chopper:

    Jesus, are you for real?

    First the US government would not be dumping a trillion into the economy in one day. The coin would be deposited in an account at the Fed and they Fed would, electronically, add $1,000,000,000 onto the account statement the Treasury would get every month. Heck if Obama logged into the account he would see an extra $1,000,000,000 on his computer screen. That is not the same as dumping a trillion dollar bills out of a plane where Jimmy Joe down the block would run to the Chevy dealer with his haul to bid up the price of the Suburban he always wanted. That trillion would be spent over months and years to cover revenue short fall over that period, AND WHILE THEY ARE DOING IT THERE IS NOTHING KEEPING THE FED FROM SOPPING UP ANY EXCESS LIQUIDITY IF NEED BE.

    That is just like what the Fed has done since 08. The Fed can simply create money out of thin air by adding it, electronically, to their computer then spend it on stuff like crediting it to the accounts of commercial banks (which they did) using it to buy up bank assets (which they did) using it to buy up home loans (which they did) and using it to buy debt the US government issues (which they did). The Fed has spent trillions and trillions over the last 4 years just like this (this has been what the Republicans have beat up on Bernanke about, Rick Perry even going so far as suggesting physical harm).

    Minting the coin and depositing it to the Fed for credit is functionally indistinguishable then the US Gov giving the Fed a slip of paper for which the Fed creates a trillion out of thin air and add it to the US Gov account, which is what they have done repeatedly in the last few years.

    Since the fed and government has functionally been functionally been doing the same thing that the coin option would entail for years, during which rates have dropped and the dollar has been fine shows what a complete load of horse shit is the theory that it would ruin the currency.

  109. 109
    johnny aquitard says:

    So, the trillion dollar coin is the new pony.

    More like a unicorn. One that farts rainbow colored bubbles.

    These people should stick to just demanding a pony. It sounds less ridiculous that way.

  110. 110
    Steve LaBonne says:

    @General Stuck: And we should care why? Which party did the Clinton impeachment hurt?

  111. 111
    Steve LaBonne says:

    @Ken: Exactly. Drum is hopelessly confused about this, as he is about many things.

  112. 112
    catclub says:

    This sounds like a useful negotiation strategy using the platinum coin (Yglesias):

    That said, it’s mighty silly. Josh Barro suggests a reasonable compromise—pass a bill that abolishes the debt ceiling and simultaneously closes the platinum coin loophole.

  113. 113
    Heliopause says:

    Communism is slightly more popular than Congress. If you poll people on communist ideas rather than the pejorative term then communism is vastly more popular than Congress.

  114. 114
    jwb says:

    @thunderlizard: Yes, when I first read about this idea during the last debt ceiling fight, I remember this legal line, and my recollection is that the idea was originally floated by a lawyer, though it was popularized by economic bloggers. Kevin Drum is nothing if not a sensible, common wisdom kind of guy, so he’s never going to go for a gimmick like this, and truthfully Obama wouldn’t under almost any circumstance either. But I do believe he would do this or the 14th Amendment option if the alternative was actual default.

  115. 115
    John Carter says:

    Here’s a crazy thought:

    Maybe we should just make a one dollar coin…that’s actually worth one dollar, first.

  116. 116
    I'mNotSureWhoIWantToBeYet says:

    (I haven’t read all the comments yet – sorry if this has already been covered.)

    While the 14th Amendment and the ONE TRILLION DOLLAR Coin have certain appeal, and I don’t expect Obama to actually let us default, presumably things are going to play out roughly as in 2011 – CNN from July 2011:

    NEW YORK (CNNMoney) — President Obama issued a broadside Tuesday in the debt ceiling debate, saying in a high-profile interview that he cannot ensure government benefits — including Social Security — will be paid if Congress fails to act.

    “I cannot guarantee that those checks go out on August 3rd if we haven’t resolved this issue. Because there may simply not be the money in the coffers to do it,” Obama told CBS News.

    This is not the first time the administration has warned that Social Security benefits are on the line. But it is the first time Obama has addressed the issue so pointedly.

    Treasury Secretary Tim Geithner warned Congress as early as Jan. 6 that benefit checks might not be paid in full and on time.

    In another letter in May, Geithner reiterated the point: “A broad range of government payments would have to be stopped, limited or delayed, including military salaries, Social Security and Medicare payments, interest on debt, unemployment benefits and tax refunds.”

    Presumably, since there is no prospect for a Grand Bargain now, he will feel much less pressure to give something up now than then, and he’ll let the Social Security recipients turn up the pressure on the House.

    But we’ll see.

    Cheers,
    Scott.

  117. 117
    Albaz says:

    All one needs to know is that Kevin Drum, the Ben Shapiro of “liberal” blogging, is against it to know that it is a solid idea. The guy is a freakin’ idiot of which there is considerable proof.

    From his “reasoned” support of the Iraq war on, he has shown himself to be an utter fool. He is the Bill Kristol of the left side of the spectrum. Why he draws a salary anywhere outside of a fast food store is a mystery.

    Okay so this is an ad hominem attack but I am still flabbergasted that anyone should pay any attention to his blather.

  118. 118
    Steve LaBonne says:

    @catclub: Yes, I believe that’s the best path forward.

  119. 119
    chopper says:

    @Napoleon:

    and how is minting and putting into circulation a trillion dollar coin not adding money to the money supply? how is adding a trillion dollars to the treasury’s account not adding money to the money supply?

    yes, the fed has added money to the system over the last four years. but not all in one fucking day. wanna know why that is? jesus christ in a chicken basket, even back in 08 when deflationary pressure has huge and wealth was vanishing in huge bloody chunks the fed still spread out the addition of money to the bank’s accounts. same with several rounds of quantitative easing since.

    seriously, go play cards or something. adults are talking about money.

  120. 120
    Napoleon says:

    By the way, here is the Fed’s balance sheet. The entire increase is funded by the Fed basically running the printing presses. Looking around on the web it appears they had increased assets (ie, printed extra money worth) 2 trillion over the last 4 years (depending on the source some show a little more, some a little less).

    http://www.ritholtz.com/blog/w.....assets.png

    http://www.clevelandfed.org/re...../index.cfm

  121. 121
    General Stuck says:

    @Steve LaBonne:

    It is hard to make a case for any long term damage from Clinton’s impeachment by the republicans. But agree that the wingnuts will think twice about it, unless they can make a solid case to the public, of gross over reach by this dem president. And the purpose is not to remove Obama from office, it would be to capture and keep the news cycle and national attention away from Obama and his agenda the second term.

    A fourteenth amendment fix is at least politically plausible, but not the stupid coin idea. And I don’t really support any more deflections or valiant rescues by democrats from GOP nihilism. What nony nony said above is the best course all around, imo. To pay national debt interest, and for the most vital government services, but let others go unfunded, so the public can get a better view of what the republicans are really about. Without giving them an excuse to deflect the nations attention for Obama taking extraordinary measures of dubious political and legal viability.

    Or, If you want to destroy the GOP, or these kinds of dangerous shenanigans by them, then the country must feel some of the pain, without actually defaulting on our debt payments. my opinion

  122. 122
    Tonal Crow says:

    I haven’t checked the relevant law, but is it possible for the Federal Reserve — which holds trillions of dollars of T-bonds — to agree to a Treasury request to void them? If so, the underlying obligation would vanish, leaving room for Treasury to issue more bonds.

  123. 123
    chopper says:

    @Tonal Crow:

    that is true. wouldn’t do much to help the stability of us bonds if the treasury specifically requested that a large chunk of them be declared worthless.

    also, that could bump up against the 14th amendment. not the fed necessarily, but the treasury.

  124. 124
    chopper says:

    @chopper:

    in fact, many would see that move as a form of selective default.

  125. 125
    Napoleon says:

    @chopper:

    and how is minting and putting into circulation a trillion dollar coin not adding money to the money supply? how is adding a trillion dollars to the treasury’s account not adding money to the money supply?

    You are a fucking idiot who hasn’t gotten the slightest idea of what you are talking about. People like you shouldn’t even be allowed to vote. Yes it is adding money to the money supply but guess what you idiot IT IS MOSTLY SITTING IN AN ACCOUNT IN NYC OUT OF CIRCULATION ONLY TO BE SENT INTO THE PUBLIC RELM AT THE RATE REVENUES DO NOT COVER EXPENDITURES. Apparently the entire concept that the trillion is a number on a piece of paper and not in actual circulation is beyond you. Let me guess, you are one of the idiots who comment on Krugman’s blog and daily prove they haven’t the foggiest idea of how the economy works.

    By the way, I have an Economics degree for undergrad.

  126. 126
    chopper says:

    @Napoleon:

    2 trillion over the last 4 years. most all of it was to counterbalance the effect that the financial crisis had in destroying money and keeping deflation at bay. something that is not nearly as much of a problem today as the economy is rebounding.

    that aside, you care to point me to a time when the fed added a trillion all at once to the system as i asked?

  127. 127
    Napoleon says:

    @Tonal Crow:

    Yes they can do that if they wish. It has been discussed as a possibility and no it would not be a default (a close alternative would be to sell them back to the gov at a deep discount).

  128. 128
    Cassidy says:

    @Napoleon:

    By the way, I have an Economics degree for undergrad

    I slept in Holiday Inn.

  129. 129
    Tonal Crow says:

    @chopper:

    @Tonal Crow:
    __
    that is true. wouldn’t do much to help the stability of us bonds if the treasury specifically requested that a large chunk of them be declared worthless.

    Hardly worthless. It’s merely a recognition that the Federal Reserve and Treasury are agencies of the same sovereign, and that extraordinary Republican crazy calls for extraordinary remedies.

    also, that could bump up against the 14th amendment. not the fed necessarily, but the treasury.

    I don’t see how. It’s not repudiation of debt.

  130. 130
    Napoleon says:

    @chopper:

    Do you even know how to read English you idiot. I answered your question. You have to be stupider then 99.9 % of the people posting here. You are completely clueless about economics.

  131. 131
    Napoleon says:

    @Tonal Crow:

    I don’t see how. It’s not repudiation of debt.

    And you would be right, it does not.

  132. 132
    Tractarian says:

    @General Stuck:

    If anyone thinks that this is about PBO “holding up a shiny coin and telling the country our problems are solved”, then they are dumber than fence posts.

  133. 133
    Steve says:

    To be clear, if you oppose the platinum coin idea because you think it would harm the economy, you should be opposed to raising the debt ceiling too.

  134. 134
    Djur says:

    @Tractarian: An apt description of Stuck.

  135. 135
    General Stuck says:

    @Tractarian:

    If anyone thinks that this is about PBO “holding up a shiny coin and telling the country our problems are solved”, then they are dumber than fence posts.

    Politically, they are dumb as dirt. Or have an agenda that is not favorable to President Obama. Need I go into detail about that?

  136. 136
    Gin & Tonic says:

    @Cassidy: I once bumped into Paul Samuelson in the hallway.

  137. 137
    Cassidy says:

    @Gin & Tonic: I had a really smart, and constantly exasperated, math teacher.

    That’s all I got.

  138. 138
    General Stuck says:

    @Djur:

    LOL, can’t even make your own insults, got to ride on the backs of others. Shouldn’t you be out knocking up 11 years olds?

  139. 139
    chopper says:

    @Napoleon:

    Yes it is adding money to the money supply

    hallelujah, it’s learning. now think about why the fed has never dropped a trillion bucks into the money supply in a single day.

    it would be far smarter for the fed to just add money (either invented or by selling assets as needed) to the treasury’s account as needed to keep it from ‘overdrawing’ as the treasury pays out. but apparently you havent’ really thought this through.

    By the way, I have an Economics degree for undergrad.

    you must have gone to arizona state.

  140. 140
    General Stuck says:

    @Napoleon:

    All pigs are equally stupid, but some pigs are more stupid than others.

  141. 141
    maya says:

    Heh. The platinum coin would only wind up stuffed in a DC parking meter anyway.

  142. 142
    chopper says:

    @chopper:

    of course, the problem with the whole idea of the fed just dumping money into the treasury’s account is that it’s essentially the fed directly financing the government, which i believe buts up against federal law and the constitution. why do you think the fed bought bonds during QE instead of just sticking money into the treasury’s account?

    that’s outside of the negative effect such would have on the dollar.

  143. 143
    bcinaz says:

    Contemplating the $1 Trillion dollar coin is fun when there is a Democrat in the White house who is not likely to start a war for oil in some god forsaken hellhole; the same cannot be said for the day when a Republican wins the Presidency. War is one of the most efficient vehicles Republicans use to transfer the wealth of the nation into the hands of their cronies.

    War with Iran? Why not, we now have the will and the way to mint a Magic Coin.

    What a Bad Idea.

  144. 144
    General Stuck says:

    @maya:

    Or Obama using it for a dime bag of smack.

  145. 145
    chopper says:

    @Tonal Crow:

    i think the us government arguing that duly-bought and paid for debt that has an actual face value should be considered worthless can be argued to fall under the 14th amendment.

    thing is, we’ve never really had that portion of the constitution tested that way before, so who knows.

  146. 146
    chopper says:

    @Napoleon:

    you’re just straight-up flailing at this point.

    maybe you should go blow bubbles in your milk for a while.

  147. 147
    Mnemosyne says:

    @Steve LaBonne:

    Which party did the Clinton impeachment hurt?

    The Democrats. What, you thought that Bush’s 5-4 victory and Republicans controlling both houses of Congress in 2000 were totally unrelated to the impeachment drama?

  148. 148
    Cassidy says:

    @General Stuck: Ahhh, that’s the secret plan. Dump a trillion dollars into the bank, which loans it out dumping a trillion dollars into the economy causing inflation. Now suddenly, the price of an ounce is ginormous. Suck it Colorado and Washington.

  149. 149
    Steve says:

    @bcinaz: Did the fact that we didn’t have the money to pay for the war in Iraq stop it from happening? Whether you realize it or not, what you are arguing is that we ought to leave the debt ceiling mechanism in place because maybe someday Democrats could use the debt ceiling to stop a war. This is neither likely nor necessary.

  150. 150
    chopper says:

    @chopper:

    far as i can tell, the only really instructive case here is Perry. it would seem that declaring such bonds as no longer having value would probably go beyond the government’s power.

    of course, if both the treasury and the fed agreed to spike the bonds, i don’t see who would have standing in that case and bring it to court.

  151. 151
    Pillsy says:

    @dr. bloor:

    By saying Obama doesn’t have this power and passing legislation that takes it away from him. They could do that immediately if they could get the bill through both chambers and override his veto.

    I can think of many other reasons why the platinum coin trick is probably a really dumb idea, but why would the Courts get involved at all.

  152. 152
    Steve LaBonne says:

    @Mnemosyne: So the 1998 midterm election never happened, nor did Clinton’s subsequent uptick in popularity (Gore would have been elected by a wider margin if he hadn’t kept Clinton at arm’s length.) If you say so.

  153. 153
    General Stuck says:

    @Steve LaBonne:

    I think it works like negative ads. People say they hate them, and poo poo the side that creates them. But they work, over time. It is likely the public thought it was wrong what the GOP was doing, and I don’t think it hurt Clinton in the 2008 primary, but it was also the truth that the economy was running on afterburners at that time, and that was the reason we picked up a few seats. But there is no doubt in my mind, all the Clinton hunting, impeachment et al, gave the country a dour case of Clinton fatigue, and not because he was particularly guilty or innocent. And was a positive factor for the republicans with Bush/Gore being as close as it was.

  154. 154
    chopper says:

    @maya:

    I was going to say a politician’s freezer but yeah.

  155. 155
    Steve LaBonne says:

    @General Stuck: I an only repeat that the actual facts- when you don’t artificially adopt 2000 as your starting point- don’t support that interpretation.

  156. 156
    Keith G says:

    This debt ceiling business is a relatively new legislative creation. Like many laws, maybe it needs to be tested now that it’s application has become such a partisan cluster fuck.

    The Congress has already said that the government shall spend that money and it’s the President’s job to see that the programs of the government supported by those expenditures be carried out as per the law’s intent.

    If Congress plays games, the President simply needs to tell his government to spend the money. The Republicans could sue to stop, but no court will take that case.

  157. 157
    General Stuck says:

    @Steve LaBonne:

    They don’t refute them either. Other than the conclusion it didn’t cost dems seats in 1998, or maybe it did. The facts don’t prove a correlation one way or another for the result of the 1998 midterm. And even if it did hurt the republicans, by costing them seats in congress that year, it seemingly wasn’t very long lasting. As per the 2000 election.

    edit – I kind of think the results of the 1998 midterm was historically in line with second mid terms of a two term president;

  158. 158
    liberal says:

    @chopper:

    that aside, you care to point me to a time when the fed added a trillion all at once to the system as i asked?

    This isn’t how it works.

    The point of the platinum coin ruse isn’t to dump more money into circulation. Rather, it’s to circumnavigate the debt limit.

    If the Fed currently has $2T in Treasury notes, and Treasury sends it a platinum $1T coin and asks that it be used to pay off debt, then the Fed will have $1T in Treasury notes and a $1T platinum coin. Essentially no impact on the money supply whatsoever.

    You can imagine a situation in the future where the Fed needs to sell Treasuries. In that case, yes, they would at some point ask Treasury to take their $1T coin back.

    But for the next couple of years, you’d have erased that much debt by a token which cannot itself be placed in circulation, yet isn’t “debt” and hence can’t be counted toward the debt limit.

  159. 159
    Steve LaBonne says:

    @General Stuck: The Dems’ big win in 1998 was HIGHLY unusual for the party of a sitting president at that point in his second term.

  160. 160
    Steve LaBonne says:

    Which also means, by the way, that people should not be feeling optimistic about 2014- unless Obama can goad the Republicans into doing something really stupid. Such as trying to shut down the government. Hardball is the right game to be playing, both politically and substantively.

  161. 161
    liberal says:

    @chopper:

    that’s outside of the negative effect such would have on the dollar.

    Well, a negative effect on the dollar would on net be good for domestic employment.

    Furthermore, it shouldn’t have any effect on the dollar, since the amount of money in circulation won’t be increasing.

  162. 162
    liberal says:

    @chopper:

    it would be far smarter for the fed to just add money (either invented or by selling assets as needed) to the treasury’s account as needed to keep it from ‘overdrawing’ as the treasury pays out.

    Except that entirely misses the point, which is to get around the debt limit.

  163. 163
    liberal says:

    @Steve LaBonne:
    You do know, don’t you, that you’re in Obot-land here at BJ?

  164. 164
    liberal says:

    @Keith G:

    This debt ceiling business is a relatively new legislative creation.

    Actually, the formality is very old, and before that the system was even more archaic—Congress would have to approve each individual bond sale.

  165. 165
    General Stuck says:

    @Steve LaBonne:

    Clinton and dems picked up 5 house seats in 98, not enough for an overall majority. Reagan lost 5 house seats in 88. I don’t see that as a big swing. And I don’t count GWB, because our politics were jumbled up by 9-11, and the country’s view of him early and late.

  166. 166
    liberal says:

    @General Stuck:

    I think it works like negative ads. People say they hate them, and poo poo the side that creates them. But they work, over time.

    Except that the polling on Clinton’s approval, etc, doesn’t show that, whereas presumably negative adds do affect candidates ratings.

  167. 167
    Cassidy says:

    @liberal:

    You do know, don’t you, that you’re in Obot-land fact based reality here at BJ?

    Most of the time anyway. Every once in a while someone loses their shit about DRRRRRONNNEEEZZZZZ! on the front page.

  168. 168
    General Stuck says:

    @liberal:

    Oh shut up, you sound like a kindergartener with that whiny bullshit.

  169. 169
    liberal says:

    @Cassidy:

    Dump a trillion dollars into the bank, which loans it out dumping a trillion dollars into the economy causing inflation.

    Except for that minor, pesky detail that it’s not actually going out into the economy.

  170. 170
    lol says:

    @Schlemizel:

    I see things have changed. Last week the Payroll Tax Cut was proof that Obama wanted to kill Social Security and the security of the American worker. This week the Payroll Tax Cut is a necessary measure for the security of the American worker. Also too Obama plans to kill Social Security.

    I can’t keep this straight.

  171. 171
    liberal says:

    @Cassidy:
    Certainly LaBonne’s interlocutors aren’t reality based on the specific issue of the medium-term effect of the impeachment on Clinton’s popularity. Nor are the folks here who for some reason think that the $1T platinum coin would add to money in circulation.

  172. 172
    Cassidy says:

    @liberal: Except for that minor, pesky detail of I was joking…did you even read the rest of it? FFS.

  173. 173
    liberal says:

    @General Stuck:
    I’m actually surprised Obama has time to do anything, for better or worse, with you constantly in front of him on kneepads.

  174. 174
    liberal says:

    @Cassidy:
    Yeah, didn’t click back to the part about a DC parking meter.

  175. 175
    DavidTC says:

    Okay, someone is going to have to explain to me how anyone else has standing to contest the trillion dollar coin trick? I mean, let’s think about this logically. The government gives someone else a coin that I think they improperly minted…and? How on earth do I have standing to contest that? How am I harmed by that?

    Granted, the Federal Reserve would have the authority to challenge it…but they’re a _bank_ accepting a _deposit_. They already have the authority to reject deposits if they want, for pretty much any reason, so it would be rather stupid to accept a deposit and then sue over it…and this entire thing would be worked out with them in advance, anyway, so obviously they’d accept it.

    So it doesn’t matter if the ‘courts’ would uphold the government’s ability to print platinum coins. The simply fact is no one has standing to sue over that in the first place anyway, except possibly the person handed the dubious coinage. (And probably not even that person, unless they were legally required to accept it in repayment for a debt.)

    That said, this is a stupid plan. I’d much rather Obama just pointed out that he’s been given two conflicting laws, and hence he gets to pick which he follows. (Although he should ‘compromise’ by, while continuing the fund the rest of the government, he stops funding anything to do with Congress, leaving them sitting in the dark with no staff or offices.)

  176. 176
    liberal says:

    @lol:
    Actually, it’s a pretty difficult issue. Stopping the tax holiday is definitely not going to be good for the economy. OTOH, the holiday itself has been damaging to SS, at least as a political matter. Hard to say what the right call is.

  177. 177
    General Stuck says:

    @liberal:

    Well, the analogy isn’t the best. But what I was talking about is that no, impeachment did not necessarily hurt or help Clinton, especially in a hypergrowth economy and job creation. But the Clinton fatigue factor, and the wingnuts pursuing him, and the entire circus of that ordeal, did hurt dems in the 2000 election. Or helped republicans.

    And like I was saying, such shit shows have the effect of distracting a sitting presidents message and agenda for a second term, while rallying the other sides activists and true believers. I see no reason to tempt that fate with trick coins and the like. You can, but I think you are as big a nihilist as the tea partiers. And have told you so. And you are not alone on the left for that.

  178. 178
    liberal says:

    @chopper:

    2 trillion over the last 4 years. most all of it was to counterbalance the effect that the financial crisis had in destroying money and keeping deflation at bay. something that is not nearly as much of a problem today as the economy is rebounding.

    Would that it were so. Have you looked at interest rates recently?

  179. 179
    General Stuck says:

    @liberal:

    ha! Nah, I got my hands full bending you over day in and out on this blog for all the stupid and white leftist privileged shit that makes you who you are. Go buy yourself a castle and wear a pointed hat.

  180. 180
    chopper says:

    @liberal:

    that would do the same. the problem with the debt limit is we’re no longer able to issue debt to raise money to cover expenses. the fed just dumping money in the treasury’s account would allow payment without issuance of debt.

    of course that’s moot anyways since that goes outside of the fed’s charter.

  181. 181
    Cassidy says:

    @liberal: Ain’t got a dog in the fight. I’ve learned to trust the guy. Does he do things I don’t like? Of course. But, over the course of his Presidency, he has passed significantly more progressive legislation than his modern predecessors and with a jacked up pack of rabid hemmorrhoids trying to destroy the country opposing him. Every time, someone starts ballyhooing about how he’s selling us out and throwing things under the bus and flushing things down the hole, but in the end we turn out okay. Progressive change is a long slow arc and always has been unless you’re willing to start doing things with considerable force and violence. That rarely ends well.

    So, honestly? I don’t know if a 1 Trillion dollar coin will result in cash money being pumped into the economy. I don’t think it’s nearly as cut and dry or as simple as you all are pretending it is. I think you’re forgeting that this whole thing is brushing up against the same sociopaths who tanked the economy with highly complicated algorithms designed to fill their wallets. If there is a way for them to reach out and masturbate with a trillion dollar coin, they’ll try it. I also think Steve is wrong in his assertion that Gore would have won by a higher margin had he embraced Clinton. That’s not really a measurable position without the color of hindsight, so it is what it is.

  182. 182
    liberal says:

    @General Stuck:

    You can, but I think you are as big a nihilist as the tea partiers.

    Huh? I’d rather not do the platinum coin option. But why bring a knife to a gunfight?

    If the TeaTards can be outmaneuvered w/o the coin solution, or the 14th Amendment solution, great. What if they can’t be? Another solution would be for Obama to stop spending money in ways that puts maximum political pressure on the Republicans. But that would involve elements of risk; different from those involved with the other two solutions, of course, but substantial nonetheless.

    The worst possible outcome is one that involves cutting entitlements in a way that appears bipartisan. That way the Dems can’t use it to attack the Republicans in 2014; or even worse, the Republican scum will attack the Dems from the left on that issue, as they’ve done before. You can already see this shit in the forms of the House saying the Senate needs to “go first” in terms of specific plans on any of those things.

  183. 183
    liberal says:

    @Cassidy:

    I don’t know if a 1 Trillion dollar coin will result in cash money being pumped into the economy.

    Frankly, if you don’t understand as simple an issue as this, then you shouldn’t be commenting on it.

  184. 184
    General Stuck says:

    It is about only firebagger clowns like liberal , napoleon etc…. that are pushing this stupid shit, using what was meant to issue commemorative coins and that sort of thing, to be used a way to get around the national debt ceiling. That alone should tell you what that idea is worth.

  185. 185
    liberal says:

    @chopper:
    Right, it has to be funded from tax revenues and debt issuance.

  186. 186
    chopper says:

    @liberal:

    depends on how negative. luckily, the fed is in much better shape to fight inflation than to fight deflation.

    the problem is, making your currency into an international laughing stock with a cartoonish ‘trillion dollar coin’ shtick would have unpredictable negative results.

  187. 187
    liberal says:

    @General Stuck:
    Yeah, yeah, I’m a firebagger—after all, I only voted for Obama twice in 2008, twice in 2012, gave him $2K in 2008, $1K in 2012.

    After all, it doesn’t matter how much money you give the guy—any and all criticism of Obama (anything short of outright, constant fellation) means you’re an oppositional firebagger.

  188. 188
    General Stuck says:

    @liberal:

    Huh? I’d rather not do the platinum coin option. But why bring a knife to a gunfight?

    The stupid coin idea is not a knife, it would be bringing a Pez Sispenser to a gunfight.

  189. 189
    chopper says:

    @liberal:

    sorry, but deflationary pressure is not now what it was back in 2008. no way.

    OTOH, we’re still very sensitive to it, since the federal funds rate is essentially zero and the fed has few arrows left in the quiver.

    personally i don’t think the inflationary effect of adding a bunch of money to the system would be all that bad, but i don’t think doing it in a cartoonish way or doing it all at once really helps in that regard.

    it would be nice if the treasury still had cash draw or securities draw authority, though for longer periods and for larger amounts, and in some manner not tied to newly-issued debt (in the case of a cash draw) which would obviously be a problem after passing the ceiling.

  190. 190
    liberal says:

    @chopper:

    the problem is, making your currency into an international laughing stock with a cartoonish ‘trillion dollar coin’ shtick would have unpredictable negative results.

    There’s no reason it should—there’s no change in the money supply.

    Furthermore, the question isn’t whether we should mint the coin, all things being equal. The question is whether minting the coin is better or worse than (a) the 14th amendment solution, (b) giving in to the wingnuts’ demands, (c) clever decisions about what to keep funding and not funding.

    (c) isn’t really that great an alternative—the deficit is so high that (IIRC) too many things are going to have to be shut down in too short a time.

    (b): depends on the wingnut’s demands.

    (a): I prefer the coin, but coin vs 14th amendment scam is a minor issue compared to the greater issues at stake.

    To put a definite marker down: I think the coin solution is far preferable to one in which entitlements are severely cut (“severely” = more than just the CPI SS adjustment) and the “blame” is apportioned to both parties.

    IMHO, I’d rather do the coin than increase Medicare age to 67. Increasing Medicare age is not just going to be hard on lots of people, it’s just entirely the wrong policy direction—we need to expand government coverage, not shrink it.

  191. 191
    liberal says:

    @chopper:

    personally i don’t think the inflationary effect of adding a bunch of money to the system would be all that bad, but i don’t think doing it in a cartoonish way or doing it all at once really helps in that regard.

    But the point is that, unless I’m misunderstanding the Fed’s current balance sheet, we’re not adding a bunch of money to the system. Period (until the Fed’s balance sheet shrinks considerably from what it is now). Until you understand that, there’s no point in going around and around on this issue.

  192. 192
    General Stuck says:

    @liberal:

    Yeah, yeah, I’m a firebagger—after all, I only voted for Obama twice in 2008, twice in 2012, gave him $2K in 2008, $1K in 2012.

    Has nothing to do with what you write here, or has it bought you anything but maybe personal joy. I don’t think in your case, you really hate Obama so much, as our entire political and economic system. And if you would stick to that, rather than bloviate bullshit about Obama or whatever, I could at least have some respect for you. There are several folks that are regulars on this blog, that are pretty much stone leftists/soshulists, and they speak straight forward about their beliefs, and we get along fine – rather than council a bunch of circuitous bullshit over Obama, or stupid governing ideas.

  193. 193
    liberal says:

    @Cassidy:

    I think you’re forgeting that this whole thing is brushing up against the same sociopaths who tanked the economy with highly complicated algorithms designed to fill their wallets. If there is a way for them to reach out and masturbate with a trillion dollar coin, they’ll try it.

    But there is no such way.

  194. 194
    liberal says:

    @General Stuck:
    No, the clear problem is that you cannot countenance any harsh words for Dear Leader. Your temperament is far better suited to a place like North Korea.

  195. 195
    Cassidy says:

    @liberal: It’s not a matter of understanding. It’s more about not taking the proclamations of fellow lay people in the comments section of a blog as some sort of profound gospel. Secondly, where there is a will, there is a way and we’ve seen on multiple occassions that the professional thieves of our financial system are more than willing to do a complete goatfuck on the laws and rules believing that they a) can and b) won’t be prosecuted.

    Frankly, I have no interest in discussing the topic and I wasn’t until you decided to be a hyperventilating dick. Don’t get me wrong, I can be a real dick [have been more often than not lately], so I don’t hold that against you, but I had no part of this back and forth between you all until you got so invested in your side of it that you failed to see that I was just trying to be humorous, and make fun of the firebagger, sky is falling faction of sending ATF Agents to harass pot smokers. Relax. Breathe in a paper bag. It ain’t the end of the world.

    But there is no such way.

    I enjoy your optimism. I hope you’re right.

  196. 196
    Keith G says:

    @liberal: Really? I was under the impression that the current legislative process is not quite 100 years old.

  197. 197
    Machine-Gun Preacher (formerly Ben Franklin) says:

    There are several folks that are regulars on this blog, that are pretty much stone leftists/soshulists,

    Who might they be? I truly, am curious.

  198. 198
    chopper says:

    @liberal:

    If the Fed currently has $2T in Treasury notes, and Treasury sends it a platinum $1T coin and asks that it be used to pay off debt, then the Fed will have $1T in Treasury notes and a $1T platinum coin. Essentially no impact on the money supply whatsoever.

    then the treasury still has no money to fund anything. so it goes out and issues new debt for tons of cash, which the fed will likely buy lots of. ‘hey, you guys have change for a trillion-dollar coin?’

    and back up against the debt ceiling again.

    i don’t really doubt the legality of the whole platinum coin thing, though it seems to be really straining the law. but it sure as hell makes our money look like a laughing stock. not as much as default, of course.

  199. 199
    General Stuck says:

    @liberal:

    No, the clear problem is that you cannot countenance any harsh words for Dear Leader. Your temperament is far better suited to a place like North Korea.

    Po lil’l liberal. Mean Stuck is why we can’t have nice firebagger things. You got the same blubber stick as I do on this blog. Blubber better Bub

  200. 200
    Machine-Gun Preacher (formerly Ben Franklin) says:

    @General Stuck:

    still waiting for your list of stone- socialists.

  201. 201
    chopper says:

    @liberal:

    the idea i was arguing against was the treasury pressing a trillion dollar coin, ‘depositing it in its account at the fed’ and writing checks therefrom. pretty silly, to be sure.

    do you not agree that this, if actually effected, would be adding money to the money supply?

  202. 202
    FormerSwingVoter says:

    I don’t see how this is really that hard. If it looks like we’re actually going to hit the debt ceiling and default is a real possibility, we go into government shutdown on basically everything, including SS checks and pay for the military. That got Republicans back to the negotiating table in a hurry back in the 90’s, didn’t it?

  203. 203
    General Stuck says:

    @Machine-Gun Preacher (formerly Ben Franklin):

    still waiting for your list of stone- socialists.

    Please take a seat. It shouldn’t be long now.

  204. 204
    chopper says:

    @FormerSwingVoter:

    we’re already past the debt ceiling, actually. right now we’re in the period where the treasury juggles shit around to make sure stuff can be paid.

  205. 205
    Heliopause says:

    I forgot to add, doing the coin trick would be just the casus belli they’re looking for to go full-metal impeachment. Remember, you don’t need a good reason to impeach, just 218-ish people willing to do it.

    Who knows, maybe that would be a good thing. Sure would be a boon to the blogosphere.

  206. 206
    Joe Buck says:

    While the platinum coin loophole appears to be bogus, there’s also a huge problem if we don’t allow loopholes. Congress has passed laws requiring money to be spent, and has also passed a law limiting the debt. What happens when these two collide? It seems to be assumed that the president can choose which debts to pay and which debts not to pay, but where in the Constitution does he get that authority? It amounts to a line-item veto, which has already been ruled unconstitutional.

    The 14th Amendment is probably a stronger argument, but if any technicality at all is used, there’s a huge problem: will any investor want to buy T-bills if there’s a legal cloud hanging over them? If a court rules them invalid (because the Treasury department had no authority to borrow money), what happens to the investor’s money? Perhaps investors will take the risk anyway, but they will demand a premium: instead of borrowing at 1% or less, suddenly treasuries will be junk bonds.

    So we should stop looking for technical ways around the crisis: it is Congress’ duty to raise the debt limit on time. If they don’t, the country’s credit rating will be ruined.

  207. 207
    Machine-Gun Preacher (formerly Ben Franklin) says:

    @General Stuck:

    Your fly is open….

    It shouldn’t be long now.

    That’s what we thought.

  208. 208
    The Tragically Flip says:

    @General Stuck:

    It is about only firebagger clowns like liberal , napoleon etc…. that are pushing this stupid shit,

    Oh, and clowns like LSE PhD Dr. Duncan Black.

    What would he know about this though?

  209. 209
    General Stuck says:

    @The Tragically Flip:

    Oh, and clowns like LSE PhD Dr. Duncan Black.

    Absolutely

    What would he know about this though?

    Apparently little, pertaining to presidential politics.

  210. 210
    The Tragically Flip says:

    @chopper:

    but it sure as hell makes our money look like a laughing stock.

    And the problem with that is? Currency depreciation would be great for America right now.

    The fact that the United States might voluntarily default on its debt out of pique by one of its major parties is also making you into a laughing stock. At least the trillion dollar coins solve that particular problem.

  211. 211
    chopper says:

    @The Tragically Flip:

    some controlled depreciation wouldn’t be bad at all. ‘controlled’ being the important word here.

    The fact that the United States might voluntarily default on its debt out of pique by one of its major parties is also making you into a laughing stock.

    which i said several times above.

  212. 212
    The Tragically Flip says:

    The other thing to consider is even if he doesn’t actually mint the coins, just acknowledging the possibility givess him options in dealing with the GOP.

    I liked the idea that he “bargains” an amendment to block Presidents from having this unlimited platinum coin authority in exchange for a repeal of the debt ceiling.

    It’s really not a great power for Presidents to have, and this would neatly solve two problems at once.

  213. 213
    The Other Chuck says:

    Another thing Obama can do is simply ignore the ceiling altogether and dare congress to impeach him for it. The funds have already been authorized anyway. I suspect this will be the case long before he does anything as showy and silly as a trillion dollar coin.

  214. 214
    serena1313 says:

    Philip Diehl, head of the U.S. Mint from 1994-2000 and was head of the Mint when the law giving authorization for such a move was passed & had rushed out a platinum bullion eagle coin in denominations up to $100, told “Capital New York” minting a trillion dollar coin is legal:

    “My understanding of how this all works suggests that this is a viable alternative” adding, “one of the ironies in this story is that a GOP Congress passed the legislation over the objections of a Democratic Treasury, and now, today, Treasury may well be in a position to use the law as leverage to neutralize the GOP’s threat to hold the debt limit hostage.”

    Diehl also said he thought that it was on firm legal ground more so than the 14th Amendment.

    “From everything I know about this, it is possible. Now, is it likely? I think it’s highly unlikely to happen. It just looks so ridiculous for the major economic power in the world to produce a trillion-dollar coin in order to balance its books. But is that any more ridiculous than the country being held hostage over default? I think not.

    “This coin thing could be done quickly—over and done with it, and I just don’t think there’s any legal basis for a challenge for it.”

    This idea was also endorsed by Josh Barro of Bloomberg View and Joseph Weisenthal of Business Insider who said “It does address another bad law, and that’s why it’s worth promoting.”

    So maybe it is not such a ridiculous solution after all. On the other hand after Fox & the GOP go ballistic and throw their tantrums, the public may not take too kindly to such a move. And given how President Obama is adverse to risk-taking … well, legal or not, I doubt seriously he would take that route anyhow. Unless, of course, the business community & Wall Street push him into it. So who knows…

  215. 215
    priscianusjr says:

    @Baud: I thought the coin was intended to be real, not just a prop or a visual aid.

    The point is that such a coin, real though it would be, would essentially amount to a prop or visual aid, since the president already has the obligation to see that the laws of the US are faithfully executed, and the USA has the legal obligation to pay debts already budgeted and incurred.

  216. 216
    grooverider31 says:

    @Baud: let me quote paul krugman today: “so this is all a gimmick — but since the debt ceiling itself is crazy, allowing congress to tell the president to spend money then tell him that he can’t raise the money he’s supposed to spend, there’s a pretty good case for using whatever gimmicks come to hand.” maybe it’s only a gimmick brought up by the mmt-people a month ago, but it has some elegance in it. and wouldn’t it be nice to see obama walk over boehner and the house without even talking to them?

  217. 217
    chopper says:

    @serena1313:

    “From everything I know about this, it is possible. Now, is it likely? I think it’s highly unlikely to happen. It just looks so ridiculous for the major economic power in the world to produce a trillion-dollar coin in order to balance its books. But is that any more ridiculous than the country being held hostage over default? I think not.”

    this is exactly my take on it.

  218. 218
    grooverider31 says:

    @The Other Chuck:mint that coin and done. why talking with those retards of the house and risk all the problems of an impeachment-process that makes our president a lame duck again for a while. forget it, mint that coin i say. my sad, that we cannot show the face of ron paul on it, because he is still alive. wouldn’t it be nice to see pauls exploding head on it?

  219. 219
    grooverider31 says:

    @The Tragically Flip: i totally agree that only the existence of the idea of such a coin and the widespread discussion about it gives obama the upper hand if he is negotiating with the house. and it’s a solution he can bring to realization overnight. obama doesn’t have to blink, if the congress isn’t moving. he can always say: “well, we do the coin.” boehner must expect that all the time. it’s a no-brainer what the gopers would do, if they had this card in their hands.

  220. 220
    different-church-lady says:

    @The Tragically Flip:

    Currency depreciation destruction would be great for America right now.

    Fixed that for you.

    @The Tragically Flip:

    Oh, and clowns like LSE PhD Dr. Duncan Black.

    You know, when Duchamp turned that urinal on its back, signed it, and entered it in the Amory Show, I suspect he wasn’t literally stating that we should take it as art: he was pulling a playful stunt with a purpose, in order to make a new statement about how we perceive art. And it would probably amuse him to no end how seriously everyone embraced his little gag.

    I suspect there may be something similar going on over at the Duncan’s Blog of One Liners.

    @General Stuck:

    I don’t think in your case, you really hate Obama so much, as our entire political and economic system. you love the sound of your own snark, cynicism, and outrage.

    Fixed that for you too.

    @liberal: Fuck, you are exhausting.

  221. 221
    grooverider31 says:

    @Napoleon: you did a good job, but the general showed his stubborness in full bloom. the debt ceiling and the budget deficit are now used as a political weapon by both parties to crush the common people, the coin shows the way out of it. the president should mint a 60 trillion dollar coin best. i only wanted to add that you had the procedure a little garbled, since it’s the treasury that orders the mint to create the coin which is then deposited in the mint’s account, which is then credited by the fed with electronic credits because the coin is legal tender, and is then swept by the treasury for the seigniorage profits which end up in the treasury account, and then you pay your bills. easy as pie. but, regardless, you have the right idea. a link to a petition for you and all who are interested on this side to inform the president, that he should mint that coin.@liberal:

    http://www.correntewire.com/co.....ent-214712

  222. 222
    General Stuck says:

    @grooverider31:

    So PUMA Central Command over at Corrente is all in with the coin trick. Cool. Color me unshocked, mylowIq

  223. 223
    Tripod says:

    Numismatics is the gold buggery of the left.

  224. 224
    Right/Left = Impulse/Thoughtfulness says:

    SO apparently “chopper” has secret access to the complete Fed files, something that not even Congress has, because “chopper” keeps making statements about the Fed that has never been revealed to the public.

    I’d suggest that “chopper” go dig up the Bloomberg.com reports that discuss the multi-trillions that the Fed “dropped” into this country without any decent accounting or transparency and then look at how in a recession that has _never_ had the inflationary impacts that were predicted.

    And “General Stuck” apparently thinks starting from an extreme right-wing position and then negotiating an even farther right-wing solution is neo-Democratic “icy” “resolve”.

    I’d suggest “General Stuck” read up on authoritarianism.

    Ironically, the authoritarian mind is the least capable of grasping what authoritarianism is (hint: It’s the willingness to blindly follow a leader without critical thinking which ironically is something that Kevin Drum has explicitly said he was willing to do for Obama).

  225. 225
    General Stuck says:

    @Right/Left = Impulse/Thoughtfulness:

    I’d suggest “General Stuck” read up on authoritarianism.

    I’d suggest blow it out your ass

  226. 226
    Evolving Deep Southerner says:

    @Right/Left = Impulse/Thoughtfulness: You’re either brand-new here or one of the best spoof trolls I’ve ever seen. You’re no Michael Gass, though.

  227. 227
    Evolving Deep Southerner says:

    @chopper: I’m way late to this thread and sure as hell don’t intend to go through 200-odd comments to see if anyone else has noted it, but the difference between a trillion-dollar coin and a $100 bill is just a difference of degree if you want to look at it that way. I mean, there’s not 100 bucks worth of paper and ink in it.

  228. 228
    chopper says:

    @Right/Left = Impulse/Thoughtfulness:

    i suggest that “dumbass” actually read what i wrote, wherein i pointed out that adding gobs of money to the system during a time of deflation years ago was not a bad thing. and despite this how dropping a trillion dollars all at once was still never performed by the fed.

    swing, and a miss.

  229. 229
    chopper says:

    @grooverider31:

    the president should mint a 315 trillion dollar coin, deposit it at the fed, and then write a million dollar check to every american.

    also, this won’t change the money supply at all. i guarantee it.

  230. 230
    Right/Left = Impulse/Thoughtfulness says:

    @chopper

    You don’t know what the Fed did or has done in the last 12 years except in the most broad sense. Saying otherwise is a lie.

    It’s worse than failing basic history, it’s a revision of history that invents claims to support your fanciful beliefs. That’s the right-wing’s job, no need to do it for them, they’re great at it all by themselves.

    Bloomberg.com extensively reported on the TRILLIONS that the Fed used to bolster the financial sector during the Bush years, but there was almost no specifics attached to those numbers, that was what the whole “audit the Fed” movement tried and failed to do (other than getting broadstroke numbers that TRILLIONS were dumped into the economy).

    @GeneralStuck you insult your opponents with casual smears and then get pissy when someone points out your authoritarianism? How very … authoritarian of you.

  231. 231
    chopper says:

    @Right/Left = Impulse/Thoughtfulness:

    so you can point me to a time when the fed dumped a trillion dollars into the system in one single day?

    please, do.

  232. 232
    General Stuck says:

    @Right/Left = Impulse/Thoughtfulness:

    @GeneralStuck you insult your opponents with casual smears and then get pissy when someone points out your authoritarianism? How very … authoritarian of you.

    That wasn’t “getting pissy” or a “casual smear”/ That was rank dismissal of your stupid ass.

  233. 233
    Right/Left = Impulse/Thoughtfulness says:

    @chopper

    Can you point me to a detailed summary of what the Fed has done day to day for, say, just the last decade?

    No, you can’t, but you can invent fantasies that support your position and I can call them out for it.

    To give you a minimal grasp of recent history, search: site:bloomberg.com Fed trillion

    Dig into more than just the first page of results to find articles older then the last couple of years.

    A dozen trillion dollar coins is still _less_, by multi-trillions, than what the Fed dumped on the economy during the last few years of Republican Bush’s administration as a failed effort to forestall the collapse. (And note the complete _lack_ of the predicted inflation because of the unique circumstances of what Krugman explains is a “liquidity trap”.)

  234. 234
    Aaron says:

    WRONG! A law is interpreted using its common meaning of words. Only when there is ambiguity should you resort to the “legislative intent”.
    And of course that doesnt apply to “originalists” republicans, and various other loons and half wits. (scalia) They believe you should figure out what the writers originally intended. Which always means fishing around for some slim piece of evidence that is the same as their political beliefs.

  235. 235
    chopper says:

    @Right/Left = Impulse/Thoughtfulness:

    so the answer is ‘no’ then? thanks for playing.

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