dagblog - Comments for "The Debt Ceiling and the 14th Amendment...Who Knew?"

Hi, John...long time, no

stillidealistic — Mon, 04 Jul 2011 17:46:28 +0000

Hi, John...long time, no see.

I hope you're right. Perhaps his calmness in this whole matter is due, in part, to his knowledge that he has a "plan b" in case they don't come to their senses. He IS a Constitutional Lawyer, so he should know better than most what he likely to be able to do under the Constitution (unless it's being interpreted by the current court, in which case it will be 5-4 in the opposite direction logical people think it should be!)

If I understand this the

John Nail — Sat, 02 Jul 2011 21:33:17 +0000

In reply to The Debt Ceiling and the 14th Amendment...Who Knew?

If I understand this the Constitution trumps any other law like the debt ceiling.

The debt ceiling raise is needed not for new spending but that that has been already authorized by Congress, ie by law and thus the President has 2 duties:
1) Uphold all laws that have been passed
2) The debt has already been committed to over many years so it is valid and "shall not be questioned.

That makes using the 14th a no brainer.

The Presidential oath also requires the President to protect and defend the Constitution. If he does not follow it as laid out above one could argue you could impeach him as well.

In fact all members of Congress took a similar oath so their inaction to provide the debt ceiling action needed to fund the laws passed by them could be deemed a violation of their oath of office subjecting Boehner in particular to impeachment. Right?

The other issue here is that failure to protect the nation's financial system from a meltdown is akin to "war" and the President again is bound to protect the nation as well. Keeping the nation from falling into a deeper recession, higher borrowing costs, higher deficits due to a double dip and the world losing faith in the US as a reserve currency makes his inaction on the 14th impeachable to me.

Failure to act has been estimated to cost the US $50B minimum directly for even a few day default due to increased debt rollover costs and as much as a trillion over a decade not to mention higher borrowing costs for consumers and business as well.

The President has put forth $2T in cuts and asked for $400B in tax loopholes being closed. Every deficit reduction plan that Reagan, Bush I and Clinton did required a combination. Why can't the Repubs simply negotiate in good faith and get this done?

If they do not they will get hung out to dry by the President being forced to act under his Constitutional duty. That surely isn't going to help them defeat Obama. It might just sew up his re-election before they even have a primary.

If they think he isn't tough enough to do this. Just remember the Sunday nite we found about Osama or the Somali pirates that were taken out right after he took office.

If he needs to he will act and get the job done as he should, no doubt about it.

Here is the case law to support it:

PERRY V. UNITED STATES, 294 U. S. 330 (1935)

The government’s contention thus raises a question of far greater importance than the particular claim of the plaintiff. On that reasoning, if the terms of the government’s bond as to the standard of payment can be repudiated, it inevitably follows that the obligation as to the amount to be paid may also be repudiated. The contention necessarily imports that the Congress can disregard the obligations of the government at its discretion, and that, when the government borrows money, the credit of the United States is an illusory pledge…

The Constitution gives to the Congress the power to borrow money on the credit of the United States, an unqualified power, a power vital to the government, upon which in an extremity its very life may depend. The binding quality of the promise of the United States is of the essence of the credit which is so pledged. Having this power to authorize the issue of definite obligations for the payment of money borrowed, the Congress has not been vested with authority to alter or destroy those obligations.

I guess this is why they get

stillidealistic — Wed, 29 Jun 2011 22:22:13 +0000

In reply to No way Obama is going to be

I guess this is why they get the big bucks. I wouldn't want to be the ones flirting with causing a world-wide depression! Nor would I want to be the dem pres who caved to the repubs bs in this game of chicken.

To be candid, I would rather see Obama be the President who decides the debt ceiling is an arbitrary piece of garbage than the one who takes the first step toward removing the safety net from under those least able to fend for themselves.

No way Obama is going to be

NCD — Wed, 29 Jun 2011 22:05:40 +0000

In reply to The Debt Ceiling and the 14th Amendment...Who Knew?

No way Obama is going to be the first Prez to raise the debt ceiling on his own, the GOP would love it, they would say the Democrats are totally out of control on the budget.

It would make Boehner and Co. look like knights in shining budgetary armor, and make Obama appear to be a thief, they would exploit the move from now until election day. No, the GOP must be on the hook on this one too, and Obama knows it.

By the way, and unrelated to

AmericanDreamer — Wed, 29 Jun 2011 21:04:12 +0000

In reply to What is Federal Reserve

By the way, and unrelated to the inane standoff over the debt, there is a solid argument that American workers would benefit from a devalued dollar. Economists like Krugman, DeLong, Baker and Bernstein have been making the case for quite a while.

Will try to check out those links but...perhaps so, but were they recommending doing that by defaulting on the national debt, versus in other ways? The former, after all, carries with it some potentially pretty severe consequences for the country's ability to engage in deliberate, desirable future short-term deficit-increasing spending increases, no?

...and the mega-wealthy will

stillidealistic — Wed, 29 Jun 2011 20:08:04 +0000

In reply to Who benefits from a devalued

...and the mega-wealthy will short the market and make a killing. Even in financial disasters, fortunes can be made. That's why I'm so unsure which way the wealthy will steer the repubs to go on this.

Sad indeed. For 19 years this

Resistance — Wed, 29 Jun 2011 18:20:35 +0000

In reply to Sadly, this is the case that

Sad indeed.

For 19 years this man paid into Social Security.

Oh great, that'll probably be

MrSmith1 — Wed, 29 Jun 2011 17:37:17 +0000

In reply to Sadly, this is the case that

Oh great, that'll probably be the neo-con pushback; all recipients of social security are socialists, therefore commies, and they should all be deported, thus, in one fell swoop, killing social security, eliminating the debt and putting the budget back into surplus. hahaha

Who benefits from a devalued

AmericanDreamer — Wed, 29 Jun 2011 16:54:55 +0000

In reply to Follow the money. Who are the

Who benefits from a devalued dollar?

In the short run at least, debtors and exporters benefit.

Debtors benefit and creditors are worse off, at least in the short run, because the dollars the debtor uses to pay off the debt are worth less, they will buy less, than they were at the time the creditor loaned them.

Exporters benefit because a weaker dollar means other countries can afford more of "our" products (or at any rate, products made in the US, which for some time now has not been one and the same thing as "our" products in the sense of being made by US-domiciled companies). They can do that because their currencies are worth more relative to our currency. By the same dynamic, importers are hurt--the prices of products purchased from abroad would go up for consumers.

We the taxpayers ultimately have to pay off the federal debt. If a default results in the US government's credit rating essentially being lowered that almost surely will increase the interest rates our government will have to pay to borrow money, which it has to do a lot of these days to pay its bills, including ones for services (and debt service) we expect and rely on, all of us. You and I and our kids are going to be paying that debt off.

Just because bankers hate currency devaluations doesn't mean that, therefore, it's always or necessarily a good thing overall for the country. Imagine that!

P.S. I'm pretty sure what I wrote above is correct but if destor or others think any of it requires correction I hope they'll do that.

Who benefits from a devalued

Orlando — Wed, 29 Jun 2011 16:01:17 +0000

In reply to Follow the money. Who are the

Who benefits from a devalued dollar?

Well, not to be all selfish, but in the short term, I do.