Sunday, July 3, 2011
The 14th Amendment: a solution to the debt ceiling impasse?
Three groups of politicians, Republicans, Democrats and 59 Tea Party Congressmen, are at loggerheads. Sensible people among Republicans and Democrats know the debt ceiling must be raised to avoid a first-ever U.S.default on its financial obligations. But those sensible Republicans – Speaker John Boehner, for example – feel they can’t cut a deal with Democrats because the Tea Party stands ready to oppose them in the 2012 primary if they do the responsible thing.
In other words, refusing to lift the debt ceilng may be impermissible and the ceiling itself could be unconstitutional. With that line of thinking, the President could simply raise the debt ceiling without Congressional approval. MSNBC reporter Chuck Todd asked President Obama at his press conference this past week his opinion on using the 14th Amendment’s requirement to avoid default looming from Congressional obstinacy. The President did a tap dance, refusing to “put on my constitutional law professor hat.”
Senator Chuck Schumer (D-NY) says the 14th Amendment strategy is worth considering during the next debt crisis but this time around “it’s probably not ripe.” More tap dance.
MA Congressman Bill Keating was similarly dismissive at a meeting this week of the New England Council.
Senator John Cornyn, on Fox News Sunday, dismissed this as “crazy talk.”
The Republican alternative, prioritizing payments, would, according to Treasury Secretary Tim Geithner, be a de facto default. This is not a solution. (As one blogger put it, “if you had friends that were drowning in debt, would you tell them to immediately start defaulting on their mortgage, their car loans and their credit cards?”) So why not go the 14th Amendment route?
Default, for our first time in history, would, in today’s global economy , be a financial disaster. And a dysfunctional Congress, prepared to paralyze the government and risk a second great recession, needs something to save it from itself.
Failing to raise the debt ceiling and causing the nation to lose its excellent bond rating could be viewed as a national security matter. If the deficit is serious now, driving interest rates to double digit levels would make our bad economic situation exponentially worse.
Some scholars like (e.g. Garret Epps and Bruce Bartlett -) ) observe that invoking the 14th Amendment to prevent default is “no less justified than using American military power to protect against an armed invasion without a Congressional declaration of war.”
Jack Balkin traced the legislative history of the 14th amendment. His review, as Jonathan Chait points out in The New Republic, notes that the goal was to remove political opponents from using debt default as a way to extract revenge. “Section Four was placed in the Constitution to remove this weapon from ordinary politics”.
Isn’t this just such a situation?
To be sure, it could trigger a Constitutional showdown. Some of the Congressional Tea Party financial illiterates could bring suit to allow the U.S. to default on its obligations. If they won, the ensuing default crisis could be catastrophic . But would a majority of Supreme Court justices, (especially swing vote Anthony Kennedy,) none of whom has to face a Tea Party primary opponent, really ratify the Constitutionality of the US defaulting on its debts and turning the world economy on its head?
Maybe Obama and Boehner talked about this when they played golf recently.
Please let me know your thoughts in the comments section below.
Posted by Margie Arons-Barron