The National Debt and the Constitution

As we wrestle with the national debt and as Congress debates over whether to raise the debt limit or risk default, we should consider what the Constitution says about the issue.  First, Congress does have the right to borrow money:

‘The Congress shall have power … To borrow money on the credit of the United States.’  Article I, Section 8

But read on to the 14th Amendment and you find this:

‘The validity of the public debt of the United States … shall not be questioned.’  14th Amendment, Section 4

The 14th Amendment deals with the wreckage of the Civil War, giving citizenship to former slaves by virtue of their having been born here (another controversial issue in the immigration debate, though clearly addressed in the Constitution) among other things.  Article 4 repudiated the debt of the Confederacy, but in doing so it affirmed that the United States will always honor its debts.

This was a brilliant addition, serving as the basis for the idea that U.S. bonds are backed by the “full faith and credit” of the United States of America, meaning they are a rock solid investment.  It isn’t just our full faith and credit that backs them but the Constitution itself.  It would be unconstitutional to default on our loans.

But, as some experts are saying now in the midst of the debt ceiling negotiations in Congress, the 14th Amendment would render all of that moot.  There is no need to raise the debt ceiling because the Constitution provides that all debt that we incur must be paid.  The money that our lawmakers are squabbling over has already been spent and has been authorized by statute.  According to the 14th Amendment, that debt has to be honored.

Debt can certainly be too high and need to be controlled.  But the 14th Amendment means that whatever we borrow must be paid back.   According to some attorneys, if the current negotiations to raise the debt ceiling break down, to prevent the country from going into default, the President simply needs to sign an executive order invoking the 14th Amendment and keep borrowing money to pay our obligations, despite what Congress does.

Do you see any flaws in this legal reasoning?

 

see U.S. Constitution Under Siege over Libya, Taxes, Health Care – TIME.

HT:  Jimmy Veith

About Gene Veith

Professor of Literature at Patrick Henry College, the Director of the Cranach Institute at Concordia Theological Seminary, a columnist for World Magazine and TableTalk, and the author of 18 books on different facets of Christianity & Culture.

  • SKPeterson

    The President would be in a difficult position to justify such an order. The debt limit would only create a delay in payment, not a repudiation of the debt. The debt would still be paid according to the provisions of the Constitution, while a Presidential end-run would violate the Constitutional separation of powers.

    This could just as easily be used as an argument for extremely drastic spending cuts – the money has been spent, so we cannot spend anywhere near the same amount from here on out in order to meet our obligations.

  • SKPeterson

    The President would be in a difficult position to justify such an order. The debt limit would only create a delay in payment, not a repudiation of the debt. The debt would still be paid according to the provisions of the Constitution, while a Presidential end-run would violate the Constitutional separation of powers.

    This could just as easily be used as an argument for extremely drastic spending cuts – the money has been spent, so we cannot spend anywhere near the same amount from here on out in order to meet our obligations.

  • Jimmy Veith

    To SKPeterson @ 1: You stated that if the President invoked the provisions of the 14th amendment to continue to prevent a default on our national debt, it would “violate the Constitutional separation of powers. “ The Constitution is the supreme law of the land for both the Executive and Legislative branch of the government. What the 14th amendment does, is to prohibit any branch of government from defaulting on our debt, except for those debts resulting from slave ownership and insurrection.

    If Congress refused to increase the debt limit, the President would be in violation of the Constitution if he honored the law. All of the national debt was lawfully incurred, whether wisely or not. We can’t now pass a law that states that we are not going to pay them.

    Please explain why you think that honoring the 14th amendment violates the Constitutional separation of powers?

  • Jimmy Veith

    To SKPeterson @ 1: You stated that if the President invoked the provisions of the 14th amendment to continue to prevent a default on our national debt, it would “violate the Constitutional separation of powers. “ The Constitution is the supreme law of the land for both the Executive and Legislative branch of the government. What the 14th amendment does, is to prohibit any branch of government from defaulting on our debt, except for those debts resulting from slave ownership and insurrection.

    If Congress refused to increase the debt limit, the President would be in violation of the Constitution if he honored the law. All of the national debt was lawfully incurred, whether wisely or not. We can’t now pass a law that states that we are not going to pay them.

    Please explain why you think that honoring the 14th amendment violates the Constitutional separation of powers?

  • G

    There’s a new piece on this subject at National Review Online

  • G

    There’s a new piece on this subject at National Review Online

  • SKPeterson

    JV – Section 7: All Bills for raising Revenue shall originate in the House of Representatives; but the Senate may propose or concur with Amendments as on other Bills.

    I would take this to mean that the President cannot unilaterally raise the debt limit. This would rely upon the relationship between debt and spending.

    Also, Section 8:
    The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States;

    To borrow Money on the credit of the United States;

    I don’t see any mention of the President having these powers.

  • SKPeterson

    JV – Section 7: All Bills for raising Revenue shall originate in the House of Representatives; but the Senate may propose or concur with Amendments as on other Bills.

    I would take this to mean that the President cannot unilaterally raise the debt limit. This would rely upon the relationship between debt and spending.

    Also, Section 8:
    The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States;

    To borrow Money on the credit of the United States;

    I don’t see any mention of the President having these powers.

  • http://favebook/mesamike Mike Westfall

    I concur with SKP. The constitution makes it perfectly clear that the president has no business (other than persuasion) dealing with the nation’s finances. That’s the job of Congress.

    Congress doesn’ tnecessarily have to raise the “debt ceiling” to pay debts. It always has the option of cutting domestic spending instead, and redirecting that money to debt repayment.

  • http://favebook/mesamike Mike Westfall

    I concur with SKP. The constitution makes it perfectly clear that the president has no business (other than persuasion) dealing with the nation’s finances. That’s the job of Congress.

    Congress doesn’ tnecessarily have to raise the “debt ceiling” to pay debts. It always has the option of cutting domestic spending instead, and redirecting that money to debt repayment.

  • Cincinnatus

    What SKPeterson and Mike said. Also, while there is no facial problem with the logic presented in the original post, the motives are suspect. Does this mean Congress can never set limits on its spending–because, you know, we’ll have to pay it some day? This particular citation of the 14th Amendment seems a mild form of extortion. Fine, the government is constitutionally obliged to pay its debts. Does that mean it must incur new ones?

    Whether it scrapes against the edifice of the fourteenth amendment–the worst amendment, I might add–the requirement of Congressional approval for raising the debt limit seems good in principle: the Treasury Department needs a check, and we all know how wild it’s been lately.

    Yes, a default would be bad for everyone and, apparently, unconstitutional (though it’s happened before…). But Congress needs an incentive to stop spending someday.

  • Cincinnatus

    What SKPeterson and Mike said. Also, while there is no facial problem with the logic presented in the original post, the motives are suspect. Does this mean Congress can never set limits on its spending–because, you know, we’ll have to pay it some day? This particular citation of the 14th Amendment seems a mild form of extortion. Fine, the government is constitutionally obliged to pay its debts. Does that mean it must incur new ones?

    Whether it scrapes against the edifice of the fourteenth amendment–the worst amendment, I might add–the requirement of Congressional approval for raising the debt limit seems good in principle: the Treasury Department needs a check, and we all know how wild it’s been lately.

    Yes, a default would be bad for everyone and, apparently, unconstitutional (though it’s happened before…). But Congress needs an incentive to stop spending someday.

  • helen

    Or it could revoke the Bush tax cuts.
    This “guns and butter” business hasn’t worked before and isn’t working now.

    Congress itself could take a pay cut like many of the rest of us, and trim their over generous pensions.
    (Not that I expect to see the day….)

  • helen

    Or it could revoke the Bush tax cuts.
    This “guns and butter” business hasn’t worked before and isn’t working now.

    Congress itself could take a pay cut like many of the rest of us, and trim their over generous pensions.
    (Not that I expect to see the day….)

  • Lou

    I think there is a difference between the Congressional role to collect revenue and pay debts vs. the issue of raising the debt ceiling. There is a correlation, to be sure. But they are not the same thing. If congress gets gridlocked and is incapable of resolving the revenue/debt payment dilemma, it should not prevent the president from taking executive action to keeping the country from defaulting.

    This is perhaps an overly simplistic example, but, if my mortage payment is due, and I don’t have enough income to pay it and if I am unable to make cuts to other expenses that have already been incurred, then I am forced to make a decision from two undesireable options: 1-default on my mortgage and lose my home or 2-incur additional debt temporarily to avoid losing my home and leaving me and my family homeless.
    I would think that the rational and moral choice here is obvious.

    Ultimately, the future “additional expenses” have to be addressed so that the debt inbalance doesn’t continue. Notwithstanding the judgements over expenditures that should have never been incurred and ended up in us being in this spot in the first place, what has to be done, has to be done, I would say.

  • Lou

    I think there is a difference between the Congressional role to collect revenue and pay debts vs. the issue of raising the debt ceiling. There is a correlation, to be sure. But they are not the same thing. If congress gets gridlocked and is incapable of resolving the revenue/debt payment dilemma, it should not prevent the president from taking executive action to keeping the country from defaulting.

    This is perhaps an overly simplistic example, but, if my mortage payment is due, and I don’t have enough income to pay it and if I am unable to make cuts to other expenses that have already been incurred, then I am forced to make a decision from two undesireable options: 1-default on my mortgage and lose my home or 2-incur additional debt temporarily to avoid losing my home and leaving me and my family homeless.
    I would think that the rational and moral choice here is obvious.

    Ultimately, the future “additional expenses” have to be addressed so that the debt inbalance doesn’t continue. Notwithstanding the judgements over expenditures that should have never been incurred and ended up in us being in this spot in the first place, what has to be done, has to be done, I would say.

  • Jimmy Veith

    To SKPeterson @ 1: You also stated that “The debt limit would only create a delay in payment, not a repudiation of the debt.”

    I believe that if the debt limit law is enforced, it means that the federal government can no longer borrow money to pay its lawfully incurred debts as they become due. This will cause us to default on the debts which is not authorized by the 14th amendment.

    It is a default even if you state that we are not repudiating the debt but just delaying payments. For example, if you miss a credit card payment you are in default on the entire debt and the credit card company can declare the entire amount due. It is no defense if you state, I am not repudiating the debt, I am just delaying payment.

    Now if we can’t borrow money because no one will loan it to us, that is another matter. The 14th amendment can not force China or anyone else to loan us more money. But that is not the problem so far. The point is that if Congresses passes a law that states that we will not pay our lawfully incurred debts, it seems to me that it would be unconstitutional under the 14th amendment.

  • Jimmy Veith

    To SKPeterson @ 1: You also stated that “The debt limit would only create a delay in payment, not a repudiation of the debt.”

    I believe that if the debt limit law is enforced, it means that the federal government can no longer borrow money to pay its lawfully incurred debts as they become due. This will cause us to default on the debts which is not authorized by the 14th amendment.

    It is a default even if you state that we are not repudiating the debt but just delaying payments. For example, if you miss a credit card payment you are in default on the entire debt and the credit card company can declare the entire amount due. It is no defense if you state, I am not repudiating the debt, I am just delaying payment.

    Now if we can’t borrow money because no one will loan it to us, that is another matter. The 14th amendment can not force China or anyone else to loan us more money. But that is not the problem so far. The point is that if Congresses passes a law that states that we will not pay our lawfully incurred debts, it seems to me that it would be unconstitutional under the 14th amendment.

  • http://www.redeemedrambling.blogspot.com/ John

    Strategy 1: Use our burgeoning debt to go after all the pet projects of the other party.
    Strategy 2: When they go after the pet project of our party, scoff that the savings is far too little to make a dent in our debt.
    Strategy 3: Continue spending like drunken sailors.

    The entire framework of this discussion is a straw-man that Congress and the fourth estate have used to redirect our thinking. We already have laws governing taxation and spending that are not being followed; at this point any appeal to the Constitution is inherently selective. What we need is spending control, and Congress has yet to prove that they can stop spending our money on foolishness.

  • http://www.redeemedrambling.blogspot.com/ John

    Strategy 1: Use our burgeoning debt to go after all the pet projects of the other party.
    Strategy 2: When they go after the pet project of our party, scoff that the savings is far too little to make a dent in our debt.
    Strategy 3: Continue spending like drunken sailors.

    The entire framework of this discussion is a straw-man that Congress and the fourth estate have used to redirect our thinking. We already have laws governing taxation and spending that are not being followed; at this point any appeal to the Constitution is inherently selective. What we need is spending control, and Congress has yet to prove that they can stop spending our money on foolishness.

  • Cincinnatus

    Jimmy@9: Actually, that’s a bit oversimplified. If Congress does not raise the debt limit, the government will simply default on certain “non-essential” expenses–perhaps it will shut down a few departments for a few days, or suspend payments to certain groups of federal employees (usually soldiers). It will not fail to repay outstanding bonds or interest on debt.

    Lou@8: Your example is inappropriate precisely because the government isn’t unable to cut its expenses, it just doesn’t want to cut its expenses (or raise taxes, for that matter).

    In the end, there is little doubt that Republicans ultimately will raise the debt ceiling, if only by a minimal level. No one wants to risk default because that hurts everyone. Republicans could probably successfully blame a default on Obama, but it’s a risky political move, and of course, millions of real people would be harmed. The United States would also likely lose its Aaa credit rating, which no one wants.

    But this whole discussion is a red herring. The United States “will” honor its debts, but that isn’t an excuse to continue incurring debt in perpetuum. That’s the Republicans’ game here: it’s one thing to ask for a temporary increase in the debt limit to stave off an exceptional crisis; it’s quite another to demand yet another increase in a long line of such increases in circumstances that don’t qualify as emergencies (except insofar as they are self-imposed emergencies). And we have to remember why “full faith and credit” is a credible promise to the rest of the world: because the United States possesses an extremely powerful Federal Reserve and an unparalleled capacity to print money. But these actions too always come at the cost of inflation and other consequences harmful to average Americans.

    So, Jimmy and others, this is a lose/lose situation for us in the long run. No one should be celebrating even if Congress does raise the ceiling.

  • Cincinnatus

    Jimmy@9: Actually, that’s a bit oversimplified. If Congress does not raise the debt limit, the government will simply default on certain “non-essential” expenses–perhaps it will shut down a few departments for a few days, or suspend payments to certain groups of federal employees (usually soldiers). It will not fail to repay outstanding bonds or interest on debt.

    Lou@8: Your example is inappropriate precisely because the government isn’t unable to cut its expenses, it just doesn’t want to cut its expenses (or raise taxes, for that matter).

    In the end, there is little doubt that Republicans ultimately will raise the debt ceiling, if only by a minimal level. No one wants to risk default because that hurts everyone. Republicans could probably successfully blame a default on Obama, but it’s a risky political move, and of course, millions of real people would be harmed. The United States would also likely lose its Aaa credit rating, which no one wants.

    But this whole discussion is a red herring. The United States “will” honor its debts, but that isn’t an excuse to continue incurring debt in perpetuum. That’s the Republicans’ game here: it’s one thing to ask for a temporary increase in the debt limit to stave off an exceptional crisis; it’s quite another to demand yet another increase in a long line of such increases in circumstances that don’t qualify as emergencies (except insofar as they are self-imposed emergencies). And we have to remember why “full faith and credit” is a credible promise to the rest of the world: because the United States possesses an extremely powerful Federal Reserve and an unparalleled capacity to print money. But these actions too always come at the cost of inflation and other consequences harmful to average Americans.

    So, Jimmy and others, this is a lose/lose situation for us in the long run. No one should be celebrating even if Congress does raise the ceiling.

  • Lou

    Jimmy, exactly! Your credit card analogy and my mortgage loan example are right along the same lines. It does no good for Congress to fight raising the debt limit — they have already spent the money and we need to pay it, even if it requires the undesirable result of taking on more debt.

    John, I agree with the sorry strategies that Congress tries to employ, but we can’t use the debt ceiling as punitive toward Congress. If they can’t resolve the budget by the end of the month, I think there should be something punitive built into the system that would be enacted against members of Congress for their failure. However, the using the debit ceiling is not it — as that will only further hurt the citizens of our country.

  • Lou

    Jimmy, exactly! Your credit card analogy and my mortgage loan example are right along the same lines. It does no good for Congress to fight raising the debt limit — they have already spent the money and we need to pay it, even if it requires the undesirable result of taking on more debt.

    John, I agree with the sorry strategies that Congress tries to employ, but we can’t use the debt ceiling as punitive toward Congress. If they can’t resolve the budget by the end of the month, I think there should be something punitive built into the system that would be enacted against members of Congress for their failure. However, the using the debit ceiling is not it — as that will only further hurt the citizens of our country.

  • Jimmy Veith

    I just read the National Review Article on this subject, which states:

    “No one has questioned the federal government’s to pay the debt instruments already issued — Treasury notes, bills, and bonds held by investors and foreign governments. Congress has authorized issuance of debt instruments of up to $14.29 trillion.
    The controversy concerns whether Congress will authorize the Treasury to issue additional debt instruments. “

    Section 4 of the 14th amendment states: “The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned. But neither the United States nor any States shall assume or pay any debt or obligation incurred in aid of insurrection or rebellion against the United States, or any claim for the loss or emancipation of any slave; but all such debts, obligations and claims shall be held illegal and void.”

    The National Review Article implies that the 14th amendment only applies to “treasury notes, bills, and bonds” . However, when read in context, the term “debt of the United States”, is clearly much broader than that, when the example it cites are “debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion“. In giving examples of debts it would not pay, it includes “any claim for the loss or emancipation of any slave”. Therefore, the term “debt” is broadly defined.

    So for example, if a construction company has a contract to build a bridge on behalf of the federal government, and the government says that we are not going to pay for it, the construction company could sue the government for violating the 14th amendment. The fact that the government has to borrow the money by issuing “treasury notes, bills and bonds” to pay for the debt, is not be a valid legal excuse for not paying the debt to the construction company.

    The problem we now have, is that we have to incur additional debt to pay for the debts that Congress has already incurred. Congress could say we are not going to incur any additional debt by not passing any more spending bills. However, they can’t make it retroactive, which is what the debt limit bill is attempting to do.

  • Jimmy Veith

    I just read the National Review Article on this subject, which states:

    “No one has questioned the federal government’s to pay the debt instruments already issued — Treasury notes, bills, and bonds held by investors and foreign governments. Congress has authorized issuance of debt instruments of up to $14.29 trillion.
    The controversy concerns whether Congress will authorize the Treasury to issue additional debt instruments. “

    Section 4 of the 14th amendment states: “The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned. But neither the United States nor any States shall assume or pay any debt or obligation incurred in aid of insurrection or rebellion against the United States, or any claim for the loss or emancipation of any slave; but all such debts, obligations and claims shall be held illegal and void.”

    The National Review Article implies that the 14th amendment only applies to “treasury notes, bills, and bonds” . However, when read in context, the term “debt of the United States”, is clearly much broader than that, when the example it cites are “debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion“. In giving examples of debts it would not pay, it includes “any claim for the loss or emancipation of any slave”. Therefore, the term “debt” is broadly defined.

    So for example, if a construction company has a contract to build a bridge on behalf of the federal government, and the government says that we are not going to pay for it, the construction company could sue the government for violating the 14th amendment. The fact that the government has to borrow the money by issuing “treasury notes, bills and bonds” to pay for the debt, is not be a valid legal excuse for not paying the debt to the construction company.

    The problem we now have, is that we have to incur additional debt to pay for the debts that Congress has already incurred. Congress could say we are not going to incur any additional debt by not passing any more spending bills. However, they can’t make it retroactive, which is what the debt limit bill is attempting to do.

  • Jeremy

    This is an interesting conversation, but does anyone else get the impression there are anti-Democrat and anti-Obama undertones? I have to wonder if we would be talking about government spending or the national deficit if Ronald Reagan or George Bush were the president.

  • Jeremy

    This is an interesting conversation, but does anyone else get the impression there are anti-Democrat and anti-Obama undertones? I have to wonder if we would be talking about government spending or the national deficit if Ronald Reagan or George Bush were the president.

  • Lou

    Cincinnatus: The government has incurred these expenses. Therefore, cutting already incurred expensees is not a real possibilty. It may not be impossible, but my analogy does work, because the expenditure has already been occured. That is how fiscal law works, just in a more complex way.

    Also, I disagree with your assessment of the trivial nature of a government shutdown. The ripple effect would be devastating and should not be considered a responsible option for any legislator.

    It’s a tough situation, but we have to be rational and responsible — two things that it would seem Congress is incapable of achieving.

  • Lou

    Cincinnatus: The government has incurred these expenses. Therefore, cutting already incurred expensees is not a real possibilty. It may not be impossible, but my analogy does work, because the expenditure has already been occured. That is how fiscal law works, just in a more complex way.

    Also, I disagree with your assessment of the trivial nature of a government shutdown. The ripple effect would be devastating and should not be considered a responsible option for any legislator.

    It’s a tough situation, but we have to be rational and responsible — two things that it would seem Congress is incapable of achieving.

  • Cincinnatus

    Lou, I never said it was trivial. No one wants a default. But you were overstating the severity of a default. A default wouldn’t cause China to come breathing down our necks; we would merely have to put a temporary halt on some less essential recurring expenses. We would not default on sovereign debt.

    And I’ve never stated opposition to raising the current debt limit as a temporary stopgap. Meanwhile, what say you to the problem of perpetually raising the debt limit? What can we do to avoid a recurrence of our current predicament?

    By the way, we have defaulted before: 1933. Britain defaulted in 1976. Neither occasion signaled the end of the world. Moreover, strictly speaking, it is impossible for the United States to default on its own currency. Defaulting for us would be a political and not an economic choice.

  • Cincinnatus

    Lou, I never said it was trivial. No one wants a default. But you were overstating the severity of a default. A default wouldn’t cause China to come breathing down our necks; we would merely have to put a temporary halt on some less essential recurring expenses. We would not default on sovereign debt.

    And I’ve never stated opposition to raising the current debt limit as a temporary stopgap. Meanwhile, what say you to the problem of perpetually raising the debt limit? What can we do to avoid a recurrence of our current predicament?

    By the way, we have defaulted before: 1933. Britain defaulted in 1976. Neither occasion signaled the end of the world. Moreover, strictly speaking, it is impossible for the United States to default on its own currency. Defaulting for us would be a political and not an economic choice.

  • Cincinnatus

    And I should clarify: the political choice is, in my opinion, an actual choice. Raising the debt limit comes with obvious benefits, but the political choice to freeze the limit could also signify–finally–that the United States is serious about controlling its spiraling and unsustainable fiscal commitments.

    Sure, we should pay our existing debts, but we don’t have to tolerate an unending cycle of debt. I would be willing to suffer a few IOU’s from Washington for inessential matters than a United States that looks like the European Union in ten years. And note this: purposely withholding paychecks, etc., is not the same as defaulting. Defaulting would mean that the United States unilaterally refuses to honor its obligations to its creditors, effectively dissolving that debt. This will never happen under current conditions.

  • Cincinnatus

    And I should clarify: the political choice is, in my opinion, an actual choice. Raising the debt limit comes with obvious benefits, but the political choice to freeze the limit could also signify–finally–that the United States is serious about controlling its spiraling and unsustainable fiscal commitments.

    Sure, we should pay our existing debts, but we don’t have to tolerate an unending cycle of debt. I would be willing to suffer a few IOU’s from Washington for inessential matters than a United States that looks like the European Union in ten years. And note this: purposely withholding paychecks, etc., is not the same as defaulting. Defaulting would mean that the United States unilaterally refuses to honor its obligations to its creditors, effectively dissolving that debt. This will never happen under current conditions.

  • Jimmy Veith

    Jeremy @ 14. I agree. According to the Time Magazine article, Congress has enacted 75 separate measures to alter the debt limit since 1962; including 17 times under Reagan, 6 under Carter, 4 under Clinton, and 10 under George W. Bush.

    However, this should not be framed as a political issue. It is ultimately a matter of Constitutional law. Under the 14th amendment, if Congress authorizes spending, it authorizes payment as a matter of law.

  • Jimmy Veith

    Jeremy @ 14. I agree. According to the Time Magazine article, Congress has enacted 75 separate measures to alter the debt limit since 1962; including 17 times under Reagan, 6 under Carter, 4 under Clinton, and 10 under George W. Bush.

    However, this should not be framed as a political issue. It is ultimately a matter of Constitutional law. Under the 14th amendment, if Congress authorizes spending, it authorizes payment as a matter of law.

  • Cincinnatus

    Yeah, just feel free to ignore my comments and continue patting one another on the back. Do I take this as celebration of our enormous debt and uncontrolled spending obligations? USA USA USA

  • Cincinnatus

    Yeah, just feel free to ignore my comments and continue patting one another on the back. Do I take this as celebration of our enormous debt and uncontrolled spending obligations? USA USA USA

  • John N

    I am going to approach this Constitutional debate from another angle. That President Obama would risk impeachment by NOT acting under the 14th Amendment to prevent default.

    Whether any of us like it or not it this debt ceiling debate is all about the “obligations” that Congress over time has signed into law, not the bonds.

    The ceiling raise has nothing to do with future spending, only that which has already been committed to by this and prior sessions of Congress over out history.

    We elected them, they act via their Constitutional responsibility passes laws/funding programs, we own it and has the “full faith and credit” of the US behind it. These are all laws that then need to be upheld, ie honored.

    The Constitution is by definition the original document plus any and all Amendments to it so trying to separate the two is a specious argument as well.

    In PERRY V. UNITED STATES, 294 U. S. 330 (1935)SCOTUS addreses the larger context of debt as “obligations” that further supports the notion that default would be unconstitutional and thus stopping it would be required of the President:

    “…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.

    We do not so read the Constitution….To say that the Congress may withdraw or ignore that pledge is to assume that the Constitution contemplates a vain promise; a pledge having no other sanction than the pleasure and convenience of the pledgor. This Court has given no sanction to such a conception of the obligations of our government.

    The Fourteenth Amendment, in its fourth section, explicitly declares: ‘The validity of the public debt of the United States, authorized by law, * * * shall not be questioned.’ While this provision was undoubtedly inspired by the desire to put beyond question the obligations of the government issued during the Civil War, its language indicates a broader connotation. We regard it as confirmatory of a fundamental principle which applies as well to the government bonds in question, and to others duly authorized by the Congress, as to those issued before the amendment was adopted. Nor can we perceive any reason for not considering the expression ‘the validity of the public debt’ as embracing whatever concerns the integrity of the public obligations.”

    The office of the President as “Chief Executive” is empowered by the Constitution that “he shall take Care that the Laws be faithfully executed”.

    He is also Constitutionally bound by his oath of office:

    “I do solemnly swear (or affirm) that I will faithfully execute the Office of President of the United States, and will to the best of my Ability, preserve, protect and defend the Constitution of the United States.”

    This creates a slippery slope for any President. In other words he has no choice in acting per the Constitution lest he violate his oath and for that could be subject to impeachment.

    A secondary argument, slightly less compelling, is that in his job as Commander in Chief to protect the nation against any threats could be cited here. A default that plunges the nation into another recession and costs the taxpayers hundreds of billions in additional Federal interest payments and billions more in higher credit card, mortgage and consumer loans threatens the nation as much as any war or attack does. Not acting would weaken the nation considerably and his failure to protect the nation from this sort of “attack” would also be seen as a failure to fulfill his oath.

    So the 14th/PERRY V. UNITED STATES makes it clear on the debt’s validity and the fact that it cannot be abrogated in anyway that diminishes the full faith and credit of the nation and its trust with any one owed money via a statute approved by Congress, be it your mom on SS, a cleaning contractor for a federal building or foreign nations holding bonds. All are equally valid and must be honored.

    So no action by Congress is illegal and the Debt Ceiling law in any dispute is trumped by the Constitution. In “Perry” Chief Justice Hughes wrote the majority opinion: “We do not so read the Constitution…the Congress has not been vested with authority to alter or destroy those obligations.”

    Altering those obligations means that the terms of meeting them cannot be changed in anyway so even a default of a few days or a program to pay bills in some order with revenues is not allowed. So inaction that allows any sort of modification is out of the question as well.

    If Obama does not act to avert the crisis if negotiations fail that is a more compelling reason to Impeach than trying to claim that he exceeds his Constitutional power in resolving the crisis using the 14th.

  • John N

    I am going to approach this Constitutional debate from another angle. That President Obama would risk impeachment by NOT acting under the 14th Amendment to prevent default.

    Whether any of us like it or not it this debt ceiling debate is all about the “obligations” that Congress over time has signed into law, not the bonds.

    The ceiling raise has nothing to do with future spending, only that which has already been committed to by this and prior sessions of Congress over out history.

    We elected them, they act via their Constitutional responsibility passes laws/funding programs, we own it and has the “full faith and credit” of the US behind it. These are all laws that then need to be upheld, ie honored.

    The Constitution is by definition the original document plus any and all Amendments to it so trying to separate the two is a specious argument as well.

    In PERRY V. UNITED STATES, 294 U. S. 330 (1935)SCOTUS addreses the larger context of debt as “obligations” that further supports the notion that default would be unconstitutional and thus stopping it would be required of the President:

    “…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.

    We do not so read the Constitution….To say that the Congress may withdraw or ignore that pledge is to assume that the Constitution contemplates a vain promise; a pledge having no other sanction than the pleasure and convenience of the pledgor. This Court has given no sanction to such a conception of the obligations of our government.

    The Fourteenth Amendment, in its fourth section, explicitly declares: ‘The validity of the public debt of the United States, authorized by law, * * * shall not be questioned.’ While this provision was undoubtedly inspired by the desire to put beyond question the obligations of the government issued during the Civil War, its language indicates a broader connotation. We regard it as confirmatory of a fundamental principle which applies as well to the government bonds in question, and to others duly authorized by the Congress, as to those issued before the amendment was adopted. Nor can we perceive any reason for not considering the expression ‘the validity of the public debt’ as embracing whatever concerns the integrity of the public obligations.”

    The office of the President as “Chief Executive” is empowered by the Constitution that “he shall take Care that the Laws be faithfully executed”.

    He is also Constitutionally bound by his oath of office:

    “I do solemnly swear (or affirm) that I will faithfully execute the Office of President of the United States, and will to the best of my Ability, preserve, protect and defend the Constitution of the United States.”

    This creates a slippery slope for any President. In other words he has no choice in acting per the Constitution lest he violate his oath and for that could be subject to impeachment.

    A secondary argument, slightly less compelling, is that in his job as Commander in Chief to protect the nation against any threats could be cited here. A default that plunges the nation into another recession and costs the taxpayers hundreds of billions in additional Federal interest payments and billions more in higher credit card, mortgage and consumer loans threatens the nation as much as any war or attack does. Not acting would weaken the nation considerably and his failure to protect the nation from this sort of “attack” would also be seen as a failure to fulfill his oath.

    So the 14th/PERRY V. UNITED STATES makes it clear on the debt’s validity and the fact that it cannot be abrogated in anyway that diminishes the full faith and credit of the nation and its trust with any one owed money via a statute approved by Congress, be it your mom on SS, a cleaning contractor for a federal building or foreign nations holding bonds. All are equally valid and must be honored.

    So no action by Congress is illegal and the Debt Ceiling law in any dispute is trumped by the Constitution. In “Perry” Chief Justice Hughes wrote the majority opinion: “We do not so read the Constitution…the Congress has not been vested with authority to alter or destroy those obligations.”

    Altering those obligations means that the terms of meeting them cannot be changed in anyway so even a default of a few days or a program to pay bills in some order with revenues is not allowed. So inaction that allows any sort of modification is out of the question as well.

    If Obama does not act to avert the crisis if negotiations fail that is a more compelling reason to Impeach than trying to claim that he exceeds his Constitutional power in resolving the crisis using the 14th.

  • Jimmy Veith

    To Cincinnatus @ 19. Sorry. I did not mean to ignore your comments @ 17. I am composing my comments off line, before I read your comment @ 17. I think we are all in agreement that the national debt is a serious problem.

    I have many disagreements with some of the expenditures Congress has incurred over the last several years that got us into this mess. However, my point is, that once the expenditures become law, we can not now say that we are not going to pay for them.

    I disagree that the failure to borrow more money to pay our debts would just result in a few individuals who would “suffer a few IOU’s from Washington for inessential matters”. Our debt problem is much more serious than that. At least that is what the economists are telling us. The result of a default would increase our interest rates further exasperating the problem.

    I have to go now, so I will leave it to others to respond to your statement that we defaulted in 1933. I would like to know more about that.

    Thank you John N for your comments @ 20. Very interesting.

  • Jimmy Veith

    To Cincinnatus @ 19. Sorry. I did not mean to ignore your comments @ 17. I am composing my comments off line, before I read your comment @ 17. I think we are all in agreement that the national debt is a serious problem.

    I have many disagreements with some of the expenditures Congress has incurred over the last several years that got us into this mess. However, my point is, that once the expenditures become law, we can not now say that we are not going to pay for them.

    I disagree that the failure to borrow more money to pay our debts would just result in a few individuals who would “suffer a few IOU’s from Washington for inessential matters”. Our debt problem is much more serious than that. At least that is what the economists are telling us. The result of a default would increase our interest rates further exasperating the problem.

    I have to go now, so I will leave it to others to respond to your statement that we defaulted in 1933. I would like to know more about that.

    Thank you John N for your comments @ 20. Very interesting.

  • DonS

    Cincinnatus has stated the issue well above. Currently, the federal government collects some $2.5 trillion per year in taxes and other revenues. That is more than ample revenue to pay off currently due obligations, including entitlement payments, without incurring additional debt, above the level currently authorized under the debt ceiling. Federal contracts can be modified or terminated, if need be, under applicable contract law, without being characterized as a default on debt, in order to continue essential federal government operations without selfishly and stupidly borrowing more money against the credit of our children. Federal employees can be laid off. Future entitlements, authorized by statute, can be modified or eliminated. Sorry, but an entitlement benefit that has not vested (such as a vested pension) is not equivalent to debt and is not guaranteed for all time. Such benefits were modified, for example, under the 1983 Social Security revisions act, which reduced future benefits, increased the retirement age for those younger than a specified age, and increased payroll taxes.

  • DonS

    Cincinnatus has stated the issue well above. Currently, the federal government collects some $2.5 trillion per year in taxes and other revenues. That is more than ample revenue to pay off currently due obligations, including entitlement payments, without incurring additional debt, above the level currently authorized under the debt ceiling. Federal contracts can be modified or terminated, if need be, under applicable contract law, without being characterized as a default on debt, in order to continue essential federal government operations without selfishly and stupidly borrowing more money against the credit of our children. Federal employees can be laid off. Future entitlements, authorized by statute, can be modified or eliminated. Sorry, but an entitlement benefit that has not vested (such as a vested pension) is not equivalent to debt and is not guaranteed for all time. Such benefits were modified, for example, under the 1983 Social Security revisions act, which reduced future benefits, increased the retirement age for those younger than a specified age, and increased payroll taxes.

  • SKPeterson

    The argument does not involve me defaulting on my credit card or mortgage payment per se. The issue is one where I get to issue the credit card and the mortgage to myself by giving myself the credit, denominate that debt in pieces of paper I print up in the garage, repackage the credit as debt- or mortgage-backed securities, sell them to others for the same pieces of paper I print, or from pieces of paper some guy down the street is printing, and then spend, spend, spend, by insisting to everyone that the paper is real money and that it will be taken as payment for the lawn mower, the vinyl siding, the new roof, brand new flooring, landscaping and several high-powered rifles for taking out anyone who objects, and then further insisting that the paper I’ve exchanged for goods and services is fully backed by all that paper.

  • SKPeterson

    The argument does not involve me defaulting on my credit card or mortgage payment per se. The issue is one where I get to issue the credit card and the mortgage to myself by giving myself the credit, denominate that debt in pieces of paper I print up in the garage, repackage the credit as debt- or mortgage-backed securities, sell them to others for the same pieces of paper I print, or from pieces of paper some guy down the street is printing, and then spend, spend, spend, by insisting to everyone that the paper is real money and that it will be taken as payment for the lawn mower, the vinyl siding, the new roof, brand new flooring, landscaping and several high-powered rifles for taking out anyone who objects, and then further insisting that the paper I’ve exchanged for goods and services is fully backed by all that paper.

  • Lou

    Don: “Federal contracts can be modified or terminated, if need be, under applicable contract law, without being characterized as a default on debt, in order to continue essential federal government operations without selfishly and stupidly borrowing more money against the credit of our children. Federal employees can be laid off. Future entitlements, authorized by statute, can be modified or eliminated.”
    Maybe. But it would be extremely unwise, even irresponsible and immoral I would argue, to use the issue of a debt ceiling as a matter of coercing this to happen. The CRA happened (six months later than it should have) and it sounds like what you are suggesting is to go back against that established legislative fiscal action and renege. Personally, I don’t see that as a viable option.

  • Lou

    Don: “Federal contracts can be modified or terminated, if need be, under applicable contract law, without being characterized as a default on debt, in order to continue essential federal government operations without selfishly and stupidly borrowing more money against the credit of our children. Federal employees can be laid off. Future entitlements, authorized by statute, can be modified or eliminated.”
    Maybe. But it would be extremely unwise, even irresponsible and immoral I would argue, to use the issue of a debt ceiling as a matter of coercing this to happen. The CRA happened (six months later than it should have) and it sounds like what you are suggesting is to go back against that established legislative fiscal action and renege. Personally, I don’t see that as a viable option.

  • DonS

    Lou: We are not talking about whether or not a particular action is wise or unwise. If wisdom were the issue, we would not be dealing with $14 trillion in debt and whether we should just keep on amassing more.

    The issue is whether the administration has the right to disregard the duly enacted debt ceiling, on the basis of some dubious argument that the Constitution requires it to do so. The answer, quite clearly, is no.

  • DonS

    Lou: We are not talking about whether or not a particular action is wise or unwise. If wisdom were the issue, we would not be dealing with $14 trillion in debt and whether we should just keep on amassing more.

    The issue is whether the administration has the right to disregard the duly enacted debt ceiling, on the basis of some dubious argument that the Constitution requires it to do so. The answer, quite clearly, is no.

  • Lou

    Cincinnatus, I completely agree with most of your statements, for example, this: “Sure, we should pay our existing debts, but we don’t have to tolerate an unending cycle of debt.” I think we only differ on our openness toward freezing the debt ceiling. I would rather see something specifically punitive toward members of Congress for their unwillingness to be fiscally responsible or to balance the budget or to simply come up with some workable solutions. The gridlock has got to go. (imo)

  • Lou

    Cincinnatus, I completely agree with most of your statements, for example, this: “Sure, we should pay our existing debts, but we don’t have to tolerate an unending cycle of debt.” I think we only differ on our openness toward freezing the debt ceiling. I would rather see something specifically punitive toward members of Congress for their unwillingness to be fiscally responsible or to balance the budget or to simply come up with some workable solutions. The gridlock has got to go. (imo)

  • Lou

    Don, With all respect due, you are 100% incorrect. The arguments here on the original post and those of the majority of the commenters seem to indicate quite the opposite.
    Please read the original article, the link to the National Review, and Jimmy Veith’s comments. Interact with those, in which I think have established a very good precedent that Obama is constitutionally bound to do so, if Congress cannot do its job by the end of the month.

  • Lou

    Don, With all respect due, you are 100% incorrect. The arguments here on the original post and those of the majority of the commenters seem to indicate quite the opposite.
    Please read the original article, the link to the National Review, and Jimmy Veith’s comments. Interact with those, in which I think have established a very good precedent that Obama is constitutionally bound to do so, if Congress cannot do its job by the end of the month.

  • John N

    All, what has happened here is the conflation of 2 things that are mutually exclusive:
    1) Paying our committed bills/debt
    2) Future financial management

    Trying to force the resolve of both with one party demanding it all go there way is no way to deal with either issue. 7 debt increases were made under Bush and with the largest portion of the debt related to his tax increases, unfunded Medicare part D and 2 wars that were off budget until Obama took over refusing to deal with this properly is total BS.

    Both need to be resolved. The former we have no choice on. The obligations have been made and the 14th clearly resolves that.

    On the future deficit one simple solution is to let all the Bush tax increases end in 2012. The deficit disappears in <10 yrs. with no changes to any programs.

    This is a great post with a great chart showing what constitutes the deficit and is the place to start in solving the problem:
    http://tpmdc.talkingpointsmemo.com/2011/07/chart-of-the-day-out-of-control-spending-not-really-out-of-control-at-all.php
    1) Tax revenues
    2) Defense Spending
    3) Entitlements – including the unfunded Part D that is a 10 year $1T cost and over $50T in 40 years.

    A reasonable review of all these area with all on the table and a combo of revenue raises and proper cuts will solve the problem for the long term.

    Continuing to conflate the already committed to the future solution will get us nowhere but forcing the President to go the 14th route which will only be required if the R's stay where they insist we all should be with no tax loophole closings.

  • John N

    All, what has happened here is the conflation of 2 things that are mutually exclusive:
    1) Paying our committed bills/debt
    2) Future financial management

    Trying to force the resolve of both with one party demanding it all go there way is no way to deal with either issue. 7 debt increases were made under Bush and with the largest portion of the debt related to his tax increases, unfunded Medicare part D and 2 wars that were off budget until Obama took over refusing to deal with this properly is total BS.

    Both need to be resolved. The former we have no choice on. The obligations have been made and the 14th clearly resolves that.

    On the future deficit one simple solution is to let all the Bush tax increases end in 2012. The deficit disappears in <10 yrs. with no changes to any programs.

    This is a great post with a great chart showing what constitutes the deficit and is the place to start in solving the problem:
    http://tpmdc.talkingpointsmemo.com/2011/07/chart-of-the-day-out-of-control-spending-not-really-out-of-control-at-all.php
    1) Tax revenues
    2) Defense Spending
    3) Entitlements – including the unfunded Part D that is a 10 year $1T cost and over $50T in 40 years.

    A reasonable review of all these area with all on the table and a combo of revenue raises and proper cuts will solve the problem for the long term.

    Continuing to conflate the already committed to the future solution will get us nowhere but forcing the President to go the 14th route which will only be required if the R's stay where they insist we all should be with no tax loophole closings.

  • Tony

    How about we don’t raise the debt ceiling.
    With the money that comes in every month, the debt interest is payed first.
    With what’s left over, Treasury can decide who gets funded and who doesn’t.

  • Tony

    How about we don’t raise the debt ceiling.
    With the money that comes in every month, the debt interest is payed first.
    With what’s left over, Treasury can decide who gets funded and who doesn’t.

  • John N

    That clearly violates the 14th amendment in that no matter what is done obligations made by Congress, ie debts are abrogated and that is clearly not allowed:

    In “Perry” Chief Justice Hughes wrote the majority opinion: “We do not so read the Constitution…the Congress has not been vested with authority to alter or destroy those obligations.”

    Altering those obligations means that the terms of meeting them cannot be changed in anyway so even a default of a few days or a program to pay bills in some order with revenues is not allowed. So inaction that allows any sort of modification is out of the question as well.

  • John N

    That clearly violates the 14th amendment in that no matter what is done obligations made by Congress, ie debts are abrogated and that is clearly not allowed:

    In “Perry” Chief Justice Hughes wrote the majority opinion: “We do not so read the Constitution…the Congress has not been vested with authority to alter or destroy those obligations.”

    Altering those obligations means that the terms of meeting them cannot be changed in anyway so even a default of a few days or a program to pay bills in some order with revenues is not allowed. So inaction that allows any sort of modification is out of the question as well.

  • Cincinnatus

    JohnN@30: I’m not an expert on Perry, so feel free to correct me, but a) that quote is a decontextualized statement that doesn’t tell me much about anything and b) your earlier quotes seem more like dicta than actual precedental ruling, and, last but not least, c) the “Gold Cases”–of which Perry was a prominent member–were a group of New Deal-era opinions which were decided b in the government’s favor, supporting the government’s claim that Congress can abrogate contractual obligations in certain conditions involving the control of the monetary system. Hughes, who indeed penned the majority opinion, agreed that this is within Congress’s legal powers. He only included a rather strong statement–dicta that is non-binding on future courts–that such abrogations are immoral, not illegal.

    But what the late Justice Hughes believes about morality is a luxury in times of crisis. Is this a crisis? SKPeterson’s wonderful analogy makes it seem so.

    Republicans are returning to the classic “starve the beast” strategy of yore, a strategy I must admit to finding agreeable at such times as these. If both parties can’t muster the legislative will to cut spending themselves–to assign their names to the budgetary guillotine–then the only option is to force the Treasury into a position when it must pick and choose what obligations to fund or risk defaulting on its sovereign debts. The Treasury will not select the latter option. Meanwhile, we might all end up better off after a temporary shock.

    I’m not a Republican, nor am I necessarily opposed to tax increases. Nor, for that matter, do I look forward to a default; I have money in the stock market and Treasury bonds, after all. And you’re right: Congress incurred these obligations. But a different Congress with different Congressmen. You’ll note that Congress is not a steady-state institution that perpetuates itself identically across time. This Congress includes a substantial caucus of members who are serious about cutting the debt, and their plans for doing so may include (may have to include) something like what’s happening now: forcing a recognition that the government must either renege on its sovereign debt (NOT A GOOD IDEA) or renege on some of its more extraneous entitlements, etc., that probably shouldn’t have existed in the first place (including Medicare Part D and other items John N mentioned @28). The latter option, by the way, has occurred in the past and really isn’t all that painful.

    Or, you know, Congress could always get serious about cutting spending in the face of an ever-increasing debt that approaches equalization with the national GDP. There’s always that. But I am fully in favor of Republicans refusing to accept a further increase to the debt ceiling without concessions on future spending.

  • Cincinnatus

    JohnN@30: I’m not an expert on Perry, so feel free to correct me, but a) that quote is a decontextualized statement that doesn’t tell me much about anything and b) your earlier quotes seem more like dicta than actual precedental ruling, and, last but not least, c) the “Gold Cases”–of which Perry was a prominent member–were a group of New Deal-era opinions which were decided b in the government’s favor, supporting the government’s claim that Congress can abrogate contractual obligations in certain conditions involving the control of the monetary system. Hughes, who indeed penned the majority opinion, agreed that this is within Congress’s legal powers. He only included a rather strong statement–dicta that is non-binding on future courts–that such abrogations are immoral, not illegal.

    But what the late Justice Hughes believes about morality is a luxury in times of crisis. Is this a crisis? SKPeterson’s wonderful analogy makes it seem so.

    Republicans are returning to the classic “starve the beast” strategy of yore, a strategy I must admit to finding agreeable at such times as these. If both parties can’t muster the legislative will to cut spending themselves–to assign their names to the budgetary guillotine–then the only option is to force the Treasury into a position when it must pick and choose what obligations to fund or risk defaulting on its sovereign debts. The Treasury will not select the latter option. Meanwhile, we might all end up better off after a temporary shock.

    I’m not a Republican, nor am I necessarily opposed to tax increases. Nor, for that matter, do I look forward to a default; I have money in the stock market and Treasury bonds, after all. And you’re right: Congress incurred these obligations. But a different Congress with different Congressmen. You’ll note that Congress is not a steady-state institution that perpetuates itself identically across time. This Congress includes a substantial caucus of members who are serious about cutting the debt, and their plans for doing so may include (may have to include) something like what’s happening now: forcing a recognition that the government must either renege on its sovereign debt (NOT A GOOD IDEA) or renege on some of its more extraneous entitlements, etc., that probably shouldn’t have existed in the first place (including Medicare Part D and other items John N mentioned @28). The latter option, by the way, has occurred in the past and really isn’t all that painful.

    Or, you know, Congress could always get serious about cutting spending in the face of an ever-increasing debt that approaches equalization with the national GDP. There’s always that. But I am fully in favor of Republicans refusing to accept a further increase to the debt ceiling without concessions on future spending.

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    What about quantitative easing? Just print paper, so that technically we can say we paid, even though the paper is worth less because it was just printed. That is what we are doing, right?

    Don: “Federal contracts can be modified or terminated, if need be, under applicable contract law, without being characterized as a default on debt, in order to continue essential federal government operations without selfishly and stupidly borrowing more money against the credit of our children. Federal employees can be laid off. Future entitlements, authorized by statute, can be modified or eliminated.”
    Maybe. But it would be extremely unwise, even irresponsible and immoral I would argue, to use the issue of a debt ceiling as a matter of coercing this to happen.

    Not sure. Entitlements as originally enacted were supposed to be supplementary and short lived based on life expectancy and the cost of medical services at the time they were enacted. I mean if 40 is the new 30, then certainly 75 is the new 65. We should very gradually increase the eligibility age by like 3 days per month until it gets to 75. For example, each month you would have to be 3 days older than the last month’s retirees in order to apply. It would also reduce the number of applicants per month, which, I believe, would be welcomed by the Social Security and Medicare administrative staff. :-D Oh, and it would mean the staff off the SSA and Medicare programs wouldn’t need to grow and increase salary expenditures. We have already increased the age from 65 to 67 and allow people who need it sooner to take it as early as age 62 at a reduced rate. That isn’t immoral. It is a flexible win-win compromise.

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    What about quantitative easing? Just print paper, so that technically we can say we paid, even though the paper is worth less because it was just printed. That is what we are doing, right?

    Don: “Federal contracts can be modified or terminated, if need be, under applicable contract law, without being characterized as a default on debt, in order to continue essential federal government operations without selfishly and stupidly borrowing more money against the credit of our children. Federal employees can be laid off. Future entitlements, authorized by statute, can be modified or eliminated.”
    Maybe. But it would be extremely unwise, even irresponsible and immoral I would argue, to use the issue of a debt ceiling as a matter of coercing this to happen.

    Not sure. Entitlements as originally enacted were supposed to be supplementary and short lived based on life expectancy and the cost of medical services at the time they were enacted. I mean if 40 is the new 30, then certainly 75 is the new 65. We should very gradually increase the eligibility age by like 3 days per month until it gets to 75. For example, each month you would have to be 3 days older than the last month’s retirees in order to apply. It would also reduce the number of applicants per month, which, I believe, would be welcomed by the Social Security and Medicare administrative staff. :-D Oh, and it would mean the staff off the SSA and Medicare programs wouldn’t need to grow and increase salary expenditures. We have already increased the age from 65 to 67 and allow people who need it sooner to take it as early as age 62 at a reduced rate. That isn’t immoral. It is a flexible win-win compromise.

  • John N

    All – here is the full Perry opinion. Worth a read as it is the only real ruling clarifying this issue:
    http://en.wikisource.org/wiki/Perry_v._United_States/Opinion_of_the_Court

    I think we agree on getting a real debt reduction/spending resolution.
    I used to be a Republican (7x straight votes since Reagan) until 2008 as I got sick of the lies. Now this behavior to take down Obama that is hurting everyone in the nation and will only get worse if we get close to default and markets react.

    Congress owns the past debt and spending not the President.

    I want that solved and then lets get to work on the long term solution.

  • John N

    All – here is the full Perry opinion. Worth a read as it is the only real ruling clarifying this issue:
    http://en.wikisource.org/wiki/Perry_v._United_States/Opinion_of_the_Court

    I think we agree on getting a real debt reduction/spending resolution.
    I used to be a Republican (7x straight votes since Reagan) until 2008 as I got sick of the lies. Now this behavior to take down Obama that is hurting everyone in the nation and will only get worse if we get close to default and markets react.

    Congress owns the past debt and spending not the President.

    I want that solved and then lets get to work on the long term solution.

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    “On the future deficit one simple solution is to let all the Bush tax increases end in 2012. The deficit disappears in <10 yrs. with no changes to any programs."

    Sounds great.

    But what if revenue falls even with higher tax rates? I mean what if fewer people are making high enough salaries, profits, etc., to actually pay more and then the actual amount of revenue keeps falling? Then what? I guess I question the supposition that the rich will always be with us.

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    “On the future deficit one simple solution is to let all the Bush tax increases end in 2012. The deficit disappears in <10 yrs. with no changes to any programs."

    Sounds great.

    But what if revenue falls even with higher tax rates? I mean what if fewer people are making high enough salaries, profits, etc., to actually pay more and then the actual amount of revenue keeps falling? Then what? I guess I question the supposition that the rich will always be with us.

  • Cincinnatus

    John N@33: As I just explained in my last comment, I think your citation of Perry is misguided except as a rhetorical device.

    As for the rest, I agree that investing the efforts of one’s party solely into taking down the leader of the other party is problematic. On the other hand, it’s how partisan politics works, for better or worse (probably worse). And I also don’t think that’s the only thing that’s going on here. In particular, “tea party” representatives are, in my opinion, quite serious about attacking the debt, etc., for its own sake rather than instrumentally as a way to smear the President.

  • Cincinnatus

    John N@33: As I just explained in my last comment, I think your citation of Perry is misguided except as a rhetorical device.

    As for the rest, I agree that investing the efforts of one’s party solely into taking down the leader of the other party is problematic. On the other hand, it’s how partisan politics works, for better or worse (probably worse). And I also don’t think that’s the only thing that’s going on here. In particular, “tea party” representatives are, in my opinion, quite serious about attacking the debt, etc., for its own sake rather than instrumentally as a way to smear the President.

  • Joe

    >> Under the 14th amendment, if Congress authorizes spending, it authorizes payment as a matter of law.

    Is Congress, in its spending authorization(s), able to condition spending on something, oh I don’t know, completely wackily unrelated like the total debt? And if this condition be or were allowable in a specific authorization, would or could it be allowable when generically applied to all authorizations, in, call me crazy, for imaging the idea, a debt ceiling resolution?

  • Joe

    >> Under the 14th amendment, if Congress authorizes spending, it authorizes payment as a matter of law.

    Is Congress, in its spending authorization(s), able to condition spending on something, oh I don’t know, completely wackily unrelated like the total debt? And if this condition be or were allowable in a specific authorization, would or could it be allowable when generically applied to all authorizations, in, call me crazy, for imaging the idea, a debt ceiling resolution?

  • John N

    Perry is not a rhetorical device it is a SCOTUS precedent that tells us how it views the 14th. It is very important in trying to determine the validity of the 14th option which to me is crystal clear.

    As I said I agree completely on long term solutions but even if the Ryan budget were enacted there would be a need for $5-7T more in debt ceiling increase over the next decade.

    Get the current obligations resolved and lets get a long term solution. The TP is treating this like how we manage our credit cards and that is not what is going on here.

    And I do not accept any altruism from these folks esp, when they admire Palin, Bachmann, Demint et al

  • John N

    Perry is not a rhetorical device it is a SCOTUS precedent that tells us how it views the 14th. It is very important in trying to determine the validity of the 14th option which to me is crystal clear.

    As I said I agree completely on long term solutions but even if the Ryan budget were enacted there would be a need for $5-7T more in debt ceiling increase over the next decade.

    Get the current obligations resolved and lets get a long term solution. The TP is treating this like how we manage our credit cards and that is not what is going on here.

    And I do not accept any altruism from these folks esp, when they admire Palin, Bachmann, Demint et al

  • Cincinnatus

    John N@37: Perhaps you didn’t read my comment. Perry explicitly holds that (under the 14th Amendment) Congress can abrogate its financial obligations.

    How can I make that more clear? All that stuff you quoted above was Justice Hughes indulging his personal opinion regarding the immorality of abrogating financial obligations, but he explicitly holds that, however immoral it might be, it is ultimately legal.

    In other words, I’m not sure what you’re trying to prove with your repeated citation of Perry and the 14th Amendment. Since Perry, the government has, in fact, reneged on its obligations a few times–most recently in the 1990′s. It’s unfortunate, but it’s neither unprecedented nor unconstitutional. The question is whether it is or is not unnecessary.

    /quadruple alliteration ftw

  • Cincinnatus

    John N@37: Perhaps you didn’t read my comment. Perry explicitly holds that (under the 14th Amendment) Congress can abrogate its financial obligations.

    How can I make that more clear? All that stuff you quoted above was Justice Hughes indulging his personal opinion regarding the immorality of abrogating financial obligations, but he explicitly holds that, however immoral it might be, it is ultimately legal.

    In other words, I’m not sure what you’re trying to prove with your repeated citation of Perry and the 14th Amendment. Since Perry, the government has, in fact, reneged on its obligations a few times–most recently in the 1990′s. It’s unfortunate, but it’s neither unprecedented nor unconstitutional. The question is whether it is or is not unnecessary.

    /quadruple alliteration ftw

  • Lou

    Cincinnatus, you had made the statement that “Congress incurred these obligations. But a different Congress with different Congressmen. ” However, that is not true. This Congress passed the CRA on March 17th for the remainder of the Fiscal Year. All of those expenditures covered under this resolution (which did successfully trim 8 billion from the budget, btw), are legally obligated to be funded.

    Your words are very persuasive and well communicated with regard to the case for using Republican obstructionism to accomplish budget reduction; however, I pray with all my heart, mind, strength and soul that these schemes will never come to pass. Raise tax revenue. You betcha. Get serious and smart about making spending cuts. Yes, absolutely. My fear is that the Reps are already resolved to their course of action on this issue, which means that nothing but gridlock will be accomplished, and more pain for American citizens.

  • Lou

    Cincinnatus, you had made the statement that “Congress incurred these obligations. But a different Congress with different Congressmen. ” However, that is not true. This Congress passed the CRA on March 17th for the remainder of the Fiscal Year. All of those expenditures covered under this resolution (which did successfully trim 8 billion from the budget, btw), are legally obligated to be funded.

    Your words are very persuasive and well communicated with regard to the case for using Republican obstructionism to accomplish budget reduction; however, I pray with all my heart, mind, strength and soul that these schemes will never come to pass. Raise tax revenue. You betcha. Get serious and smart about making spending cuts. Yes, absolutely. My fear is that the Reps are already resolved to their course of action on this issue, which means that nothing but gridlock will be accomplished, and more pain for American citizens.

  • Lou

    Sorry, my mistake. The full-year CRA was passed and signed on 14 April 2011 by the current congress for the remainder of FY11.

  • Lou

    Sorry, my mistake. The full-year CRA was passed and signed on 14 April 2011 by the current congress for the remainder of FY11.

  • Jimmy Veith

    There is an excellent detailed discussion of the legislative history of Section 4 of the 14th amendment at a cite called “Balkinization”, by Jack M. Balkin. See his articles dated June 30th and July 2nd. (I would provide you with a link, but I don’t know how.) The legislative history is clear that it was passed to prevent Congress from playing politics with threats to repudiate our national debt, which is what it is doing now. Very interesting.

  • Jimmy Veith

    There is an excellent detailed discussion of the legislative history of Section 4 of the 14th amendment at a cite called “Balkinization”, by Jack M. Balkin. See his articles dated June 30th and July 2nd. (I would provide you with a link, but I don’t know how.) The legislative history is clear that it was passed to prevent Congress from playing politics with threats to repudiate our national debt, which is what it is doing now. Very interesting.

  • http://carolmsblog.blogspot.com/ Carol-Christian Soldier

    Do you see any flaws in this legal reasoning?

    YES-it is counter to the original intent of the Constitution-
    the Constitution is NOT a “living-breathing” document-the Founders never used that language-we had better start acting upon the original intent or we will lose this Republic…
    C-CS

  • http://carolmsblog.blogspot.com/ Carol-Christian Soldier

    Do you see any flaws in this legal reasoning?

    YES-it is counter to the original intent of the Constitution-
    the Constitution is NOT a “living-breathing” document-the Founders never used that language-we had better start acting upon the original intent or we will lose this Republic…
    C-CS

  • DonS

    Carol @ 42: The original intent of the Founders is not at issue, because we are talking about the 14th Amendment, duly passed by the people after the Civil War.

  • DonS

    Carol @ 42: The original intent of the Founders is not at issue, because we are talking about the 14th Amendment, duly passed by the people after the Civil War.

  • http://carolmsblog.blogspot.com/ Carol-Christian Soldier

    time to change it then-
    C-CS

  • http://carolmsblog.blogspot.com/ Carol-Christian Soldier

    time to change it then-
    C-CS

  • DonS

    Lou @ 27 (and I will respond, as appropriate, to comments following, by John N and others):

    It is not at all clear to me why you believe I am “100% incorrect”, other than that I disagree with some of the arguments and comments on this thread. No matter. Obviously, I didn’t explain myself adequately, so I will try again.

    Clearly, the relevant clause in the 14th Amendment references “the public debt”. Debt is debt — borrowed money already received from the lender. The Perry case relied upon by John N @ 33 deals with exactly this kind of debt — a treasury bond denominated in U.S. gold-backed currency. The issue was whether, because of intervening Congressional action to eliminate gold as legal tender, the Treasury Department could repay that obligation in paper money having the same nominal value as the original gold-backed notes. The answer, of course, was no. Since this was the issue, any comments by that court regarding moral obligations or extension of the 14th Amendment language to obligations of the government other than debt, if that language is in the case, is mere dicta, having no legal effect.

    As I understand the original argument of certain Democrats, it was that, if the debt ceiling issue is not resolved, and the debt ceiling is not increased by August 2, it will be the responsibility of the administration to ignore the law and issue more debt, so that existing debt obligations can be repaid and kept current. The problem with this argument, as I pointed out in my earlier comment, is that it is unnecessary to issue additional debt to keep our current debt obligations current. We have plenty of current revenue to service our existing debt. It will require rather severe current spending cuts, but it is perfectly feasible to do. So if Obama were to take the extraordinary action of merely ignoring the debt ceiling law, he would be actually making a policy judgment, not appropriate for the administration, that it is more important to continue current levels of spending than to obey the law. That is not his province — it is the province of Congress. His job is to administer the government using only the funding made available to him by the Congress.

    Now I’m hearing even more radical arguments on this thread — to the effect that current spending obligations, just passed in the CRA a couple of months ago (after the Democrats, while controlling both houses of Congress and the administration, failed to even offer a 2010-11 budget — a much more constitutionally dubious action than anything else we are discussing here) are somehow equivalent to the debt referenced in the 14th Amendment. I can certainly assure you that there is absolutely no case law or precedent supporting that view. To the extent that the federal government has committed itself contractually, then it will either have to honor or terminate those contracts in accordance with the law, same as any other party. To the extent that earned benefits, such as pension obligations, have vested, those need to be paid. Any other entitlement or transfer payments are not debt, within the meaning of the Constitution. They can be abrogated or modified if there is insufficient funding to pay them.

    That said, there should be no need to do anything that radical to meet our debt obligations this year without additional debt authorization. Discretionary funding, employee terminations and layoffs, and the like, would free up sufficient money to meet our existing debt obligations.

    Of course, the goal is to negotiate an orderly increase in the debt authorization limit, with a corresponding reduction in spending, so that nothing that dramatic need be done. We’ll see. Apparently, the Democrats would prefer to play these kinds of absurd games, and in the meantime just keep running up the tab on our kids.

  • DonS

    Lou @ 27 (and I will respond, as appropriate, to comments following, by John N and others):

    It is not at all clear to me why you believe I am “100% incorrect”, other than that I disagree with some of the arguments and comments on this thread. No matter. Obviously, I didn’t explain myself adequately, so I will try again.

    Clearly, the relevant clause in the 14th Amendment references “the public debt”. Debt is debt — borrowed money already received from the lender. The Perry case relied upon by John N @ 33 deals with exactly this kind of debt — a treasury bond denominated in U.S. gold-backed currency. The issue was whether, because of intervening Congressional action to eliminate gold as legal tender, the Treasury Department could repay that obligation in paper money having the same nominal value as the original gold-backed notes. The answer, of course, was no. Since this was the issue, any comments by that court regarding moral obligations or extension of the 14th Amendment language to obligations of the government other than debt, if that language is in the case, is mere dicta, having no legal effect.

    As I understand the original argument of certain Democrats, it was that, if the debt ceiling issue is not resolved, and the debt ceiling is not increased by August 2, it will be the responsibility of the administration to ignore the law and issue more debt, so that existing debt obligations can be repaid and kept current. The problem with this argument, as I pointed out in my earlier comment, is that it is unnecessary to issue additional debt to keep our current debt obligations current. We have plenty of current revenue to service our existing debt. It will require rather severe current spending cuts, but it is perfectly feasible to do. So if Obama were to take the extraordinary action of merely ignoring the debt ceiling law, he would be actually making a policy judgment, not appropriate for the administration, that it is more important to continue current levels of spending than to obey the law. That is not his province — it is the province of Congress. His job is to administer the government using only the funding made available to him by the Congress.

    Now I’m hearing even more radical arguments on this thread — to the effect that current spending obligations, just passed in the CRA a couple of months ago (after the Democrats, while controlling both houses of Congress and the administration, failed to even offer a 2010-11 budget — a much more constitutionally dubious action than anything else we are discussing here) are somehow equivalent to the debt referenced in the 14th Amendment. I can certainly assure you that there is absolutely no case law or precedent supporting that view. To the extent that the federal government has committed itself contractually, then it will either have to honor or terminate those contracts in accordance with the law, same as any other party. To the extent that earned benefits, such as pension obligations, have vested, those need to be paid. Any other entitlement or transfer payments are not debt, within the meaning of the Constitution. They can be abrogated or modified if there is insufficient funding to pay them.

    That said, there should be no need to do anything that radical to meet our debt obligations this year without additional debt authorization. Discretionary funding, employee terminations and layoffs, and the like, would free up sufficient money to meet our existing debt obligations.

    Of course, the goal is to negotiate an orderly increase in the debt authorization limit, with a corresponding reduction in spending, so that nothing that dramatic need be done. We’ll see. Apparently, the Democrats would prefer to play these kinds of absurd games, and in the meantime just keep running up the tab on our kids.

  • Lou

    Don, I def empathize with your frustration about the Dems and their irresponsibility. I know I’ve bashed the Reps here, but for the record, I’m not arguing for the Dem side either.

    While it seems that we agree on the gravity of the situation, there are two key things I see we are opposed on: 1) the President’s authority to invoke the 14th amendment to raise the debt ceiling, in the case that Congress fails to do its job before the alloted time and 2) the legally binding nature of the CRA (Continuing Resolution Authority) to pay debt incurred as stated in legislature previously passed for a specified period of time and monetary value.

    One other thing that is of high importance from my perspective is that I see you and a few others as all too willing to terminate and lay off employees without regard to the ripple effects. Here is the situation you create by doing that: an enormous spike in unemployment claims that the government will have to pay out, an enormous number of transfers from shared health care plans to governmental backed health care via Obamacare/Cobra/etc. .. The list goes on. Then, once the mess is straightened out, a large percentage of those federal workers will return to work and be paid retroactively, depending on their job title, etc. Tell me this solves anything. The only thing that will get achieved is more debt for the government, demoralized workers, and a plunge in the economy. From my point of view, this is simply not an option.

    Our legislators need to move away from political posturing, pushing pet ideologies and meta-theories of how things woulda/ coulda/ shoulda been better only if… and start offering real steps and solutions. I would never support a decision that was intentionally made to make people suffer in order to force politians to respond a particular way. But that’s just me.

  • Lou

    Don, I def empathize with your frustration about the Dems and their irresponsibility. I know I’ve bashed the Reps here, but for the record, I’m not arguing for the Dem side either.

    While it seems that we agree on the gravity of the situation, there are two key things I see we are opposed on: 1) the President’s authority to invoke the 14th amendment to raise the debt ceiling, in the case that Congress fails to do its job before the alloted time and 2) the legally binding nature of the CRA (Continuing Resolution Authority) to pay debt incurred as stated in legislature previously passed for a specified period of time and monetary value.

    One other thing that is of high importance from my perspective is that I see you and a few others as all too willing to terminate and lay off employees without regard to the ripple effects. Here is the situation you create by doing that: an enormous spike in unemployment claims that the government will have to pay out, an enormous number of transfers from shared health care plans to governmental backed health care via Obamacare/Cobra/etc. .. The list goes on. Then, once the mess is straightened out, a large percentage of those federal workers will return to work and be paid retroactively, depending on their job title, etc. Tell me this solves anything. The only thing that will get achieved is more debt for the government, demoralized workers, and a plunge in the economy. From my point of view, this is simply not an option.

    Our legislators need to move away from political posturing, pushing pet ideologies and meta-theories of how things woulda/ coulda/ shoulda been better only if… and start offering real steps and solutions. I would never support a decision that was intentionally made to make people suffer in order to force politians to respond a particular way. But that’s just me.

  • Joe

    Everyone needs to take a breath. There is no real threat of a default unless the administration just decides to default. The debt as in outstanding obligations can be paid for out of what comes in monthly. What can’t be covered is both discretionary spending and debt service. So if the debt ceiling is not raised then the Administration has a choice to make. Stop paying our debt service or stop spending some of the discretionary budget to cover the debt service. It seems like a pretty simple choice unless the administration and some members of the legislature (of both parties) want to play games.

    btw – the Joe at 36 is not me. Hey, Joe at 36 – there’s only room for one Joe around here ….

  • Joe

    Everyone needs to take a breath. There is no real threat of a default unless the administration just decides to default. The debt as in outstanding obligations can be paid for out of what comes in monthly. What can’t be covered is both discretionary spending and debt service. So if the debt ceiling is not raised then the Administration has a choice to make. Stop paying our debt service or stop spending some of the discretionary budget to cover the debt service. It seems like a pretty simple choice unless the administration and some members of the legislature (of both parties) want to play games.

    btw – the Joe at 36 is not me. Hey, Joe at 36 – there’s only room for one Joe around here ….

  • DonS

    Lou @ 46:

    While it seems that we agree on the gravity of the situation, there are two key things I see we are opposed on: 1) the President’s authority to invoke the 14th amendment to raise the debt ceiling, in the case that Congress fails to do its job before the alloted time and 2) the legally binding nature of the CRA (Continuing Resolution Authority) to pay debt incurred as stated in legislature previously passed for a specified period of time and monetary value.

    As to 1), you haven’t yet cited anything credible as to why you believe the president is authorized to ignore the law. Most of the commenters on here, including myself, have repeatedly pointed out that the president has a lot of options to avoid default short of unilaterally disregarding the debt ceiling law and continuing our reckless borrowing. One of those options is to actually engage in productive negotiations with the Republicans in the House, instead of this silly posturing. As to 2), I agree that any debt incurred must be repaid, so I don’t see what your issue is. Future budgeted spending is not debt, and can be changed.

    The remainder of your comment relates to policy, and is not really at issue here.

  • DonS

    Lou @ 46:

    While it seems that we agree on the gravity of the situation, there are two key things I see we are opposed on: 1) the President’s authority to invoke the 14th amendment to raise the debt ceiling, in the case that Congress fails to do its job before the alloted time and 2) the legally binding nature of the CRA (Continuing Resolution Authority) to pay debt incurred as stated in legislature previously passed for a specified period of time and monetary value.

    As to 1), you haven’t yet cited anything credible as to why you believe the president is authorized to ignore the law. Most of the commenters on here, including myself, have repeatedly pointed out that the president has a lot of options to avoid default short of unilaterally disregarding the debt ceiling law and continuing our reckless borrowing. One of those options is to actually engage in productive negotiations with the Republicans in the House, instead of this silly posturing. As to 2), I agree that any debt incurred must be repaid, so I don’t see what your issue is. Future budgeted spending is not debt, and can be changed.

    The remainder of your comment relates to policy, and is not really at issue here.

  • John N

    You are dead wrong on the future budgeted spending. it is not just the CR but SS and other programs as well. Once authorized by law the Congress is legally responsible to fund it.

    The 14th actually was put in after the Civil War to not allow future Congresses to default on prior commitments. SCOTUS reaffirmed this and expanded on it “Perry” in 1935.

    More details here:
    http://bentelligence.wordpress.com/2011/07/04/could-obama-be-impeached-for-not-using-14th-amendment/

  • John N

    You are dead wrong on the future budgeted spending. it is not just the CR but SS and other programs as well. Once authorized by law the Congress is legally responsible to fund it.

    The 14th actually was put in after the Civil War to not allow future Congresses to default on prior commitments. SCOTUS reaffirmed this and expanded on it “Perry” in 1935.

    More details here:
    http://bentelligence.wordpress.com/2011/07/04/could-obama-be-impeached-for-not-using-14th-amendment/

  • John N

    Joe – this is not the President’s job but Congress. They are legally liable to fund the laws they pass or add to the debt ceiling to do so like they did 8X for Bush.

    The wars are ongoing commitments and must be funded as one huge example since they have added nearly $3T to the deficit all by themselves.

    If they fail to act then the President must by law step in since defaulting on the full faith and credit is prohibited by the Constitution.

  • John N

    Joe – this is not the President’s job but Congress. They are legally liable to fund the laws they pass or add to the debt ceiling to do so like they did 8X for Bush.

    The wars are ongoing commitments and must be funded as one huge example since they have added nearly $3T to the deficit all by themselves.

    If they fail to act then the President must by law step in since defaulting on the full faith and credit is prohibited by the Constitution.

  • John N

    Could Obama Be Impeached for Not Using 14th Amendment? July
    I am going to approach this Constitutional debate from another angle. That President Obama would risk impeachment by NOT acting under the 14th Amendment to prevent default.

    Whether any of us like it or not it this debt ceiling debate is all about the “obligations” that Congress over time has signed into law, not the bonds.

    The ceiling raise has nothing to do with future spending, only that which has already been committed to by this and prior sessions of Congress over out history.

    We elected them, they act via their Constitutional responsibility passes laws/funding programs, we own it and has the “full faith and credit” of the US behind it. These are all laws that then need to be upheld, ie honored.

    The Constitution is by definition the original document plus any and all Amendments to it so trying to separate the two is a specious argument as well.

    In PERRY V. UNITED STATES, 294 U. S. 330 (1935)SCOTUS addreses the larger context of debt as “obligations” that further supports the notion that default would be unconstitutional and thus stopping it would be required of the President:

    “…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.

    We do not so read the Constitution….To say that the Congress may withdraw or ignore that pledge is to assume that the Constitution contemplates a vain promise; a pledge having no other sanction than the pleasure and convenience of the pledgor. This Court has given no sanction to such a conception of the obligations of our government.

    The Fourteenth Amendment, in its fourth section, explicitly declares: ‘The validity of the public debt of the United States, authorized by law, * * * shall not be questioned.’ While this provision was undoubtedly inspired by the desire to put beyond question the obligations of the government issued during the Civil War, its language indicates a broader connotation. We regard it as confirmatory of a fundamental principle which applies as well to the government bonds in question, and to others duly authorized by the Congress, as to those issued before the amendment was adopted. Nor can we perceive any reason for not considering the expression ‘the validity of the public debt’ as embracing whatever concerns the integrity of the public obligations.”

    The office of the President as “Chief Executive” is empowered by the Constitution that “he shall take Care that the Laws be faithfully executed”.

    He is also Constitutionally bound by his oath of office:

    “I do solemnly swear (or affirm) that I will faithfully execute the Office of President of the United States, and will to the best of my Ability, preserve, protect and defend the Constitution of the United States.”

    This creates a slippery slope for any President. In other words he has no choice in acting per the Constitution lest he violate his oath and for that could be subject to impeachment.

    A secondary argument, slightly less compelling, is that in his job as Commander in Chief to protect the nation against any threats could be cited here. A default that plunges the nation into another recession and costs the taxpayers hundreds of billions in additional Federal interest payments and billions more in higher credit card, mortgage and consumer loans threatens the nation as much as any war or attack does. Not acting would weaken the nation considerably and his failure to protect the nation from this sort of “attack” would also be seen as a failure to fulfill his oath.

    So the 14th/PERRY V. UNITED STATES makes it clear on the debt’s validity and the fact that it cannot be abrogated in anyway that diminishes the full faith and credit of the nation and its trust with any one owed money via a statute approved by Congress, be it your mom on SS, a cleaning contractor for a federal building or foreign nations holding bonds. All are equally valid and must be honored.

    So no action by Congress is illegal and the Debt Ceiling law in any dispute is trumped by the Constitution. In “Perry” Chief Justice Hughes wrote the majority opinion: “We do not so read the Constitution…the Congress has not been vested with authority to alter or destroy those obligations.”

    Altering those obligations means that the terms of meeting them cannot be changed in anyway so even a default of a few days or a program to pay bills in some order with revenues is not allowed. So inaction that allows any sort of modification is out of the question as well.

    If Obama does not act to avert the crisis if negotiations fail that is a more compelling reason to Impeach than trying to claim that he exceeds his Constitutional power in resolving the crisis using the 14th.

  • John N

    Could Obama Be Impeached for Not Using 14th Amendment? July
    I am going to approach this Constitutional debate from another angle. That President Obama would risk impeachment by NOT acting under the 14th Amendment to prevent default.

    Whether any of us like it or not it this debt ceiling debate is all about the “obligations” that Congress over time has signed into law, not the bonds.

    The ceiling raise has nothing to do with future spending, only that which has already been committed to by this and prior sessions of Congress over out history.

    We elected them, they act via their Constitutional responsibility passes laws/funding programs, we own it and has the “full faith and credit” of the US behind it. These are all laws that then need to be upheld, ie honored.

    The Constitution is by definition the original document plus any and all Amendments to it so trying to separate the two is a specious argument as well.

    In PERRY V. UNITED STATES, 294 U. S. 330 (1935)SCOTUS addreses the larger context of debt as “obligations” that further supports the notion that default would be unconstitutional and thus stopping it would be required of the President:

    “…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.

    We do not so read the Constitution….To say that the Congress may withdraw or ignore that pledge is to assume that the Constitution contemplates a vain promise; a pledge having no other sanction than the pleasure and convenience of the pledgor. This Court has given no sanction to such a conception of the obligations of our government.

    The Fourteenth Amendment, in its fourth section, explicitly declares: ‘The validity of the public debt of the United States, authorized by law, * * * shall not be questioned.’ While this provision was undoubtedly inspired by the desire to put beyond question the obligations of the government issued during the Civil War, its language indicates a broader connotation. We regard it as confirmatory of a fundamental principle which applies as well to the government bonds in question, and to others duly authorized by the Congress, as to those issued before the amendment was adopted. Nor can we perceive any reason for not considering the expression ‘the validity of the public debt’ as embracing whatever concerns the integrity of the public obligations.”

    The office of the President as “Chief Executive” is empowered by the Constitution that “he shall take Care that the Laws be faithfully executed”.

    He is also Constitutionally bound by his oath of office:

    “I do solemnly swear (or affirm) that I will faithfully execute the Office of President of the United States, and will to the best of my Ability, preserve, protect and defend the Constitution of the United States.”

    This creates a slippery slope for any President. In other words he has no choice in acting per the Constitution lest he violate his oath and for that could be subject to impeachment.

    A secondary argument, slightly less compelling, is that in his job as Commander in Chief to protect the nation against any threats could be cited here. A default that plunges the nation into another recession and costs the taxpayers hundreds of billions in additional Federal interest payments and billions more in higher credit card, mortgage and consumer loans threatens the nation as much as any war or attack does. Not acting would weaken the nation considerably and his failure to protect the nation from this sort of “attack” would also be seen as a failure to fulfill his oath.

    So the 14th/PERRY V. UNITED STATES makes it clear on the debt’s validity and the fact that it cannot be abrogated in anyway that diminishes the full faith and credit of the nation and its trust with any one owed money via a statute approved by Congress, be it your mom on SS, a cleaning contractor for a federal building or foreign nations holding bonds. All are equally valid and must be honored.

    So no action by Congress is illegal and the Debt Ceiling law in any dispute is trumped by the Constitution. In “Perry” Chief Justice Hughes wrote the majority opinion: “We do not so read the Constitution…the Congress has not been vested with authority to alter or destroy those obligations.”

    Altering those obligations means that the terms of meeting them cannot be changed in anyway so even a default of a few days or a program to pay bills in some order with revenues is not allowed. So inaction that allows any sort of modification is out of the question as well.

    If Obama does not act to avert the crisis if negotiations fail that is a more compelling reason to Impeach than trying to claim that he exceeds his Constitutional power in resolving the crisis using the 14th.

  • John N
  • John N
  • Cincinnatus

    John N.: Wrong wrong wrong. I’ve refuted your citation of Perry too many times to count, so either attempt to refute my analysis or drop it. Second, I, along with DonS, have also insisted too many times to count that reneging on discretionary spending obligations is not the same as defaulting on sovereign debt, about which, yes, the Fourtheenth Amendment has something to say. A default isn’t going to happen. Period. As others have pointed out–again, too many times to count–the United States collects more than enough monthly revenue to ensure that debt is serviced and default is precluded; even if we weren’t collecting enough revenue, we could, in an emergency, print money or indulge other debt instruments to avoid a default. This may come at the cost of a partial government shutdown, etc.

    But government shutdowns (i.e., refusals to fund certain discretionary obligations) have happened several times before. They are not illegal. They are not unconstitutional.

    Your point is absurd, John N. Congress adjusts, reneges, and otherwise changes its programmatic obligations all the time. If what you were claiming were true, it would be unconstitutional, for instance, to raise the retirement age for Social Security or, say, to eliminate Medicare Part D in order to avoid future entitlement crises. In fact, it would be impossible to eliminate any government program or reduce any spending whatsoever once it has been voted on. Really? Are you seriously making this argument? A couple of decades ago, the Defense Department was allocated several billion dollars to develop the F-22 stealth fighter. This program was recently canceled. Unconstitutional? Obama recently canceled the Bush administration’s Constellation program for NASA, which had already been allotted money by Congress. Illegal?

  • Cincinnatus

    John N.: Wrong wrong wrong. I’ve refuted your citation of Perry too many times to count, so either attempt to refute my analysis or drop it. Second, I, along with DonS, have also insisted too many times to count that reneging on discretionary spending obligations is not the same as defaulting on sovereign debt, about which, yes, the Fourtheenth Amendment has something to say. A default isn’t going to happen. Period. As others have pointed out–again, too many times to count–the United States collects more than enough monthly revenue to ensure that debt is serviced and default is precluded; even if we weren’t collecting enough revenue, we could, in an emergency, print money or indulge other debt instruments to avoid a default. This may come at the cost of a partial government shutdown, etc.

    But government shutdowns (i.e., refusals to fund certain discretionary obligations) have happened several times before. They are not illegal. They are not unconstitutional.

    Your point is absurd, John N. Congress adjusts, reneges, and otherwise changes its programmatic obligations all the time. If what you were claiming were true, it would be unconstitutional, for instance, to raise the retirement age for Social Security or, say, to eliminate Medicare Part D in order to avoid future entitlement crises. In fact, it would be impossible to eliminate any government program or reduce any spending whatsoever once it has been voted on. Really? Are you seriously making this argument? A couple of decades ago, the Defense Department was allocated several billion dollars to develop the F-22 stealth fighter. This program was recently canceled. Unconstitutional? Obama recently canceled the Bush administration’s Constellation program for NASA, which had already been allotted money by Congress. Illegal?

  • John N

    Yet another well researched piece on this topic from real experts:
    http://wallstreetpit.com/78897-debt-limit-options

  • John N

    Yet another well researched piece on this topic from real experts:
    http://wallstreetpit.com/78897-debt-limit-options

  • DonS

    John N @ 49 and following: Cincinnatus has well and eloquently refuted the argument you keep repeating, @ 53. It is interesting that you have not engaged our arguments at all — you just keep making the same fanciful point and then point us to a few more liberal blogs.

    Until you actually engage in reasoned debate, meaning that you engage and respond to our arguments, there is no further point to this conversation.

  • DonS

    John N @ 49 and following: Cincinnatus has well and eloquently refuted the argument you keep repeating, @ 53. It is interesting that you have not engaged our arguments at all — you just keep making the same fanciful point and then point us to a few more liberal blogs.

    Until you actually engage in reasoned debate, meaning that you engage and respond to our arguments, there is no further point to this conversation.

  • Lou

    DonS – Nope. There are plenty of people, here and elsewhere, who see the 14th amendment as the president’s duty to raise the debt ceiling if Congress fails to do its job by law. By Law.

    2- you don’t understand debt and fiscal law. Congress has already legally ‘spent’ FY11. It has already gone thru appropriations. They are legally bound to fulfill it. It is not, as you are trying to say, ‘future budget’ It is past appropropriation – ie, debt.

    As I say, we need to move past the posturing and get out of gridlock and do the right thing. Period. You and I will have to agree to disagree about our own interpretations.

  • Lou

    DonS – Nope. There are plenty of people, here and elsewhere, who see the 14th amendment as the president’s duty to raise the debt ceiling if Congress fails to do its job by law. By Law.

    2- you don’t understand debt and fiscal law. Congress has already legally ‘spent’ FY11. It has already gone thru appropriations. They are legally bound to fulfill it. It is not, as you are trying to say, ‘future budget’ It is past appropropriation – ie, debt.

    As I say, we need to move past the posturing and get out of gridlock and do the right thing. Period. You and I will have to agree to disagree about our own interpretations.

  • DonS

    Lou — that’s your response? “Nope”? Because “plenty of people” think the president should just raise the debt ceiling unilaterally, in contravention to the law?

    Beautiful.

    You might try citing some authority for your novel notion that appropriate funds are equivalent to debt instruments such as bonds.

  • DonS

    Lou — that’s your response? “Nope”? Because “plenty of people” think the president should just raise the debt ceiling unilaterally, in contravention to the law?

    Beautiful.

    You might try citing some authority for your novel notion that appropriate funds are equivalent to debt instruments such as bonds.

  • DonS

    “appropriate” should, of course, be “appropriated” in 57.

  • DonS

    “appropriate” should, of course, be “appropriated” in 57.

  • John N

    Actually everything we have posted refutes his position as his position is wrong on the entire issue of default. If you read these articles and my original post this is all clearly in there .

    Yes Congress can pass laws to change things but they simply cannot renege. There is a difference.

    Shutdowns have nothing to do with a default on the full faith and credit of the nation.

    Laws must be supported until changed otherwise. The budget or a CR are laws that have $$ associated with them or a program cancellation is enacted by law and removed by law. Ignoring them for default is not the same.

    The Perry cite reference numerous times here makes the issue of debt/obligations crystal clear.

    So if Congress wants to cut spending then they need to pass a law or laws doing that to avoid the default.Clearly this is not possible without Senate and Presidential support. Checks and balances an checkmate on cuts only vs. cut and revenue raisers,

    If they cannot get a deal or do not up the limit cleanly then the 14th would have to be put in play.

    If Congress refuses to up the limit it is a default on lawfully committed obligations and the 14th has to be used.

    Partial payment schemes are not a solution as all obligations have equal value under the 14th and “Perry” be they SS, war contractors or a painter doing work in a federal office. All are obligations subject to the full faith and credit of the US.

    If Obama were to not act he would be subject to impeachment for not fulfilling his oath of office and Constitutional duty as Chief Executive.

  • John N

    Actually everything we have posted refutes his position as his position is wrong on the entire issue of default. If you read these articles and my original post this is all clearly in there .

    Yes Congress can pass laws to change things but they simply cannot renege. There is a difference.

    Shutdowns have nothing to do with a default on the full faith and credit of the nation.

    Laws must be supported until changed otherwise. The budget or a CR are laws that have $$ associated with them or a program cancellation is enacted by law and removed by law. Ignoring them for default is not the same.

    The Perry cite reference numerous times here makes the issue of debt/obligations crystal clear.

    So if Congress wants to cut spending then they need to pass a law or laws doing that to avoid the default.Clearly this is not possible without Senate and Presidential support. Checks and balances an checkmate on cuts only vs. cut and revenue raisers,

    If they cannot get a deal or do not up the limit cleanly then the 14th would have to be put in play.

    If Congress refuses to up the limit it is a default on lawfully committed obligations and the 14th has to be used.

    Partial payment schemes are not a solution as all obligations have equal value under the 14th and “Perry” be they SS, war contractors or a painter doing work in a federal office. All are obligations subject to the full faith and credit of the US.

    If Obama were to not act he would be subject to impeachment for not fulfilling his oath of office and Constitutional duty as Chief Executive.

  • Cincinnatus

    Lou and John N.: I recognize that there can be perfectly valid differences of opinion on this upcoming crisis–otherwise there would be no pending crisis. But your entitlement to your own opinion does not extend to facts themselves. Fact: Congressional appropriations, discretionary spending, and future entitlements, are not the same as sovereign debt. Period.

    Anyway, as for my opinion, I don’t think the Republicans will allow a shutdown–that didn’t go well for them in the 1990s, because Gingrich and his party ended up taking the blame in the minds of voters–and they will certainly not allow a default. In fact, a default isn’t really on the table in actuality. If a deal isn’t reached, federal workers will be laid off or certain services will be shut down, but there is no way Obama and the Treasury will permit an actual default. And I don’t know why you’re pushing for “extraordinary” measures. There is ample precedent for a partial government shutdown in such circumstances; we should all be wary of allowing the President to assume extraordinary “new” powers, such as the authority to supersede the will of Congress unilaterally. It’s just not necessary here.

    In any case, I’m fairly certain the Republicans are only attempting to ensure that, for once, we don’t raise the debt limit yet again without some concrete promises to deal with the crisis by cutting spending, etc., in the future. I’m ok with this. And if they succeed, they’ll gain quite a bit of favor with voters. Note that the House of Representatives is the originator of all bills appertaining to fiscal concerns. It is quite possible, then, that it will be the Democrats and President who are blamed this time around if a shutdown does occur. Who knows. But I’m not kept awake at night by the remote possibility of a default.

  • Cincinnatus

    Lou and John N.: I recognize that there can be perfectly valid differences of opinion on this upcoming crisis–otherwise there would be no pending crisis. But your entitlement to your own opinion does not extend to facts themselves. Fact: Congressional appropriations, discretionary spending, and future entitlements, are not the same as sovereign debt. Period.

    Anyway, as for my opinion, I don’t think the Republicans will allow a shutdown–that didn’t go well for them in the 1990s, because Gingrich and his party ended up taking the blame in the minds of voters–and they will certainly not allow a default. In fact, a default isn’t really on the table in actuality. If a deal isn’t reached, federal workers will be laid off or certain services will be shut down, but there is no way Obama and the Treasury will permit an actual default. And I don’t know why you’re pushing for “extraordinary” measures. There is ample precedent for a partial government shutdown in such circumstances; we should all be wary of allowing the President to assume extraordinary “new” powers, such as the authority to supersede the will of Congress unilaterally. It’s just not necessary here.

    In any case, I’m fairly certain the Republicans are only attempting to ensure that, for once, we don’t raise the debt limit yet again without some concrete promises to deal with the crisis by cutting spending, etc., in the future. I’m ok with this. And if they succeed, they’ll gain quite a bit of favor with voters. Note that the House of Representatives is the originator of all bills appertaining to fiscal concerns. It is quite possible, then, that it will be the Democrats and President who are blamed this time around if a shutdown does occur. Who knows. But I’m not kept awake at night by the remote possibility of a default.

  • Cincinnatus

    And yeah, John N. Congress can renege. That’s exactly what Perry holds.

    But how to make this more clear? THE GOVERNMENT WILL NOT HAVE TO DEFAULT. A default would be totally and completely unnecessary, even if the debt limit is not raised. That’s why talk of shutdowns is relevant. In order to service debt without a new debt ceiling, some government services may have to be temporarily shut down. Big deal. The journalists you cite are just indulging a bit of hysteria. It sells copy.

  • Cincinnatus

    And yeah, John N. Congress can renege. That’s exactly what Perry holds.

    But how to make this more clear? THE GOVERNMENT WILL NOT HAVE TO DEFAULT. A default would be totally and completely unnecessary, even if the debt limit is not raised. That’s why talk of shutdowns is relevant. In order to service debt without a new debt ceiling, some government services may have to be temporarily shut down. Big deal. The journalists you cite are just indulging a bit of hysteria. It sells copy.

  • http://facebook.com/mesamike Mike Westfall

    I fail to see how the 14th amendment requires the president to take us deeper into debt in order to pay our debts. That’s just a bizarre notion.

    Yes, it’s the executive branch’s duty to enforce the laws, but what law requires us to go deeper into debt? Can someone name it?

  • http://facebook.com/mesamike Mike Westfall

    I fail to see how the 14th amendment requires the president to take us deeper into debt in order to pay our debts. That’s just a bizarre notion.

    Yes, it’s the executive branch’s duty to enforce the laws, but what law requires us to go deeper into debt? Can someone name it?

  • John N

    Cincinnatus – all the Perry references we have used were from the ruling and not the opinion of the Chief Justice.

    Read it all here:
    http://en.wikisource.org/wiki/Perry_v._United_States/Opinion_of_the_Court
    “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.”

    “alter or destroy” so no program to prioritize is legal either

    The ruling unequivocally says all debt is equal under the law and has to be paid.

    The entire point of the 14th was to keep future Congresses from reneging on prior commitments illegally. Yes they could pass laws to change things but simply defund them at will.

  • John N

    Cincinnatus – all the Perry references we have used were from the ruling and not the opinion of the Chief Justice.

    Read it all here:
    http://en.wikisource.org/wiki/Perry_v._United_States/Opinion_of_the_Court
    “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.”

    “alter or destroy” so no program to prioritize is legal either

    The ruling unequivocally says all debt is equal under the law and has to be paid.

    The entire point of the 14th was to keep future Congresses from reneging on prior commitments illegally. Yes they could pass laws to change things but simply defund them at will.

  • John N

    Mike it is not about getting deeper into debt. Those debts are already incurred. Default is not allowed by law that is the whole point and the President is required by law to not let that happen by the Constitution.

    It is a bit “Catch 22″ but that is what the law says.

  • John N

    Mike it is not about getting deeper into debt. Those debts are already incurred. Default is not allowed by law that is the whole point and the President is required by law to not let that happen by the Constitution.

    It is a bit “Catch 22″ but that is what the law says.

  • John N

    Cincinnatus – Perry was absolutely not about allowing default. In fact Congress never promised you’d be paid in gold.

    What it allowed was that the bond at question was backed up by gold as the US was on the gold standard. When the suit was brought we had left the gold standard and the $10K the guy put into a $10K US bond was worth $16.7K if he had bought gold instead of a bond. The court ruled that he had bought $10K US money not the gold equivalent and paying him his $10K + interest was what he was due so there was no default of any sort.

  • John N

    Cincinnatus – Perry was absolutely not about allowing default. In fact Congress never promised you’d be paid in gold.

    What it allowed was that the bond at question was backed up by gold as the US was on the gold standard. When the suit was brought we had left the gold standard and the $10K the guy put into a $10K US bond was worth $16.7K if he had bought gold instead of a bond. The court ruled that he had bought $10K US money not the gold equivalent and paying him his $10K + interest was what he was due so there was no default of any sort.

  • Lou

    DonS: Your tone is quite striking. And your bent to mischaracterize what I’ve written is troubling. I very directly and specifically stated that if Congress does not fullfil its legal obligation as set forth by the fourteenth amendment, many people both here and on other legitmate websites have made the case that Obama is justified to raise the debt ceiling in order to keep the US from defaulting.
    Please do not malign my words.

    As a fiscal law officer of the DoD for more than seven, I am well acquainted with Congressional appropriations. http://www.gao.gov/special.pubs/appforum2010/d10424sp.pdf
    Please do not think more highly of your own opinions than you ought. Thanks.

    It is getting mighty testy in here. If Benevolent Veith starts deleting posts, I hope he will leave the good ones.

  • Lou

    DonS: Your tone is quite striking. And your bent to mischaracterize what I’ve written is troubling. I very directly and specifically stated that if Congress does not fullfil its legal obligation as set forth by the fourteenth amendment, many people both here and on other legitmate websites have made the case that Obama is justified to raise the debt ceiling in order to keep the US from defaulting.
    Please do not malign my words.

    As a fiscal law officer of the DoD for more than seven, I am well acquainted with Congressional appropriations. http://www.gao.gov/special.pubs/appforum2010/d10424sp.pdf
    Please do not think more highly of your own opinions than you ought. Thanks.

    It is getting mighty testy in here. If Benevolent Veith starts deleting posts, I hope he will leave the good ones.

  • John N

    How much clearer can it be than this line:
    “We do not so read the Constitution….To say that the Congress may withdraw or ignore that pledge is to assume that the Constitution contemplates a vain promise; a pledge having no other sanction than the pleasure and convenience of the pledgor. This Court has given no sanction to such a conception of the obligations of our government.”

    “obligations” = committed $$ and thus have to be honored.

  • John N

    How much clearer can it be than this line:
    “We do not so read the Constitution….To say that the Congress may withdraw or ignore that pledge is to assume that the Constitution contemplates a vain promise; a pledge having no other sanction than the pleasure and convenience of the pledgor. This Court has given no sanction to such a conception of the obligations of our government.”

    “obligations” = committed $$ and thus have to be honored.

  • Lou

    And when I say “good ones” I don’t mean ‘only the ones I agree with’. Afterall, we ARE trying to have a discussion, are we not?

  • Lou

    And when I say “good ones” I don’t mean ‘only the ones I agree with’. Afterall, we ARE trying to have a discussion, are we not?

  • http://facebook.com/mesamike Mike Westfall

    John N keeps conflating “commitments” with “obligations for the payment of money borrowed.”

    “Commitments” are generally charity at the hands of a benevolent government . Handouts, in other words.

    When the continuance of charitable handouts becomes a legally binding obligation on Congress then the USA no longer exists as constituted on the basis of freedom and liberty. I fear we’ve already jumped that shark, though.

  • http://facebook.com/mesamike Mike Westfall

    John N keeps conflating “commitments” with “obligations for the payment of money borrowed.”

    “Commitments” are generally charity at the hands of a benevolent government . Handouts, in other words.

    When the continuance of charitable handouts becomes a legally binding obligation on Congress then the USA no longer exists as constituted on the basis of freedom and liberty. I fear we’ve already jumped that shark, though.

  • http://facebook.com/mesamike Mike Westfall

    John N.:

    Raising the DEBT CEILING isn’t about going deeper into debt? Are you serious? Why else would we raise the DEBT CEILING if not for the purpose of going deeper into debt?

  • http://facebook.com/mesamike Mike Westfall

    John N.:

    Raising the DEBT CEILING isn’t about going deeper into debt? Are you serious? Why else would we raise the DEBT CEILING if not for the purpose of going deeper into debt?

  • Cincinnatus

    If posts are indeed deleted, I have to assume that the most useless posts are the ones that include fallacious appeals to authority in the form of delineating one’s resume. Well, I’ll just retract all my statements because I’m in the presence of a former DoD employee.

    But seriously, if the debt has already been incurred, then there is no need to raise the debt limit because it’s already accounted as debt, yes? As for other obligations, for which money has not yet been appropriated, they can either be altered by Congress or the government can be shut down. The only reason that this is complicated is because of the intervention of partisan politics: neither side wants a shutdown, and one side (ahem) isn’t willing to contemplate the severe cuts necessary to repair our structural problems–they just want to sweep the problem under the rug. Meanwhile, both sides simply want to affix blame to the other side in a partisan circus.

    Ultimately, a fiscal reckoning is coming. The United States can’t float on debt forever, and what better time to have this conversation when the side that is in favor of serious cuts holds some of the cards? Talk is cheap.

  • Cincinnatus

    If posts are indeed deleted, I have to assume that the most useless posts are the ones that include fallacious appeals to authority in the form of delineating one’s resume. Well, I’ll just retract all my statements because I’m in the presence of a former DoD employee.

    But seriously, if the debt has already been incurred, then there is no need to raise the debt limit because it’s already accounted as debt, yes? As for other obligations, for which money has not yet been appropriated, they can either be altered by Congress or the government can be shut down. The only reason that this is complicated is because of the intervention of partisan politics: neither side wants a shutdown, and one side (ahem) isn’t willing to contemplate the severe cuts necessary to repair our structural problems–they just want to sweep the problem under the rug. Meanwhile, both sides simply want to affix blame to the other side in a partisan circus.

    Ultimately, a fiscal reckoning is coming. The United States can’t float on debt forever, and what better time to have this conversation when the side that is in favor of serious cuts holds some of the cards? Talk is cheap.

  • John N

    Cincinnatus – These are hardly left wing, wild eyed liberals on this

    Bush’s own economist Bruce Bartlett – a Republican – is one of the key proponents of the 14th issue.
    http://wallstreetpit.com/78897-debt-limit-options

    All the articles actually cite real experts and are hardly trying to sell their magazines …its all free on the web :-)

    Here is the Examiner- a right wing newspaper group on the subject:
    http://www.examiner.com/political-buzz-in-national/could-president-obama-pursue-nuclear-option-on-the-debt-ceiling

    If this is such an obviously wrong idea why has no single Republican leader or economist come out and said so in clear words with their own interpretations and cites?

    Because the argument, though untested is likely correct esp. with a crisis of unimaginable cost as the alternative.

  • John N

    Cincinnatus – These are hardly left wing, wild eyed liberals on this

    Bush’s own economist Bruce Bartlett – a Republican – is one of the key proponents of the 14th issue.
    http://wallstreetpit.com/78897-debt-limit-options

    All the articles actually cite real experts and are hardly trying to sell their magazines …its all free on the web :-)

    Here is the Examiner- a right wing newspaper group on the subject:
    http://www.examiner.com/political-buzz-in-national/could-president-obama-pursue-nuclear-option-on-the-debt-ceiling

    If this is such an obviously wrong idea why has no single Republican leader or economist come out and said so in clear words with their own interpretations and cites?

    Because the argument, though untested is likely correct esp. with a crisis of unimaginable cost as the alternative.

  • John N

    Mike – the 2 are the same under the law as we have shown time and again here.

    If any Congress has passed a law of any sort and funded any type of program it is an obligation until such time as the law is changed, like a change in SS might be or a change in how CPI is calculated for SS payments.

    The CR passed a few months ago is law and by law has to be funded.

    If somehow the Ryan budget became law it alone would call for $5T more in deficit spending in the next few years as well.

  • John N

    Mike – the 2 are the same under the law as we have shown time and again here.

    If any Congress has passed a law of any sort and funded any type of program it is an obligation until such time as the law is changed, like a change in SS might be or a change in how CPI is calculated for SS payments.

    The CR passed a few months ago is law and by law has to be funded.

    If somehow the Ryan budget became law it alone would call for $5T more in deficit spending in the next few years as well.

  • DonS

    Lou @ 66: My tone reflected frustration with your refusal to address the arguments. To have a good discussion, both sides need to engage.

    As a federal fiscal law officer, you should know better than to be using Perry to make your point. As you well know, cases are only law with respect to the facts actually adjudicated. Dicta and innuendo that might be contained in the opinion are not binding. The Perry case dealt with debt instrumentalities, i.e. bonds, duly issued by the United States government. There is no law which holds that appropriations are equivalent to issued debt instruments for the purposes of the 14th Amendment provision guaranteeing U.S. debt. Deal with that, please. Explain to us the law which you believes expands Perry to require that all appropriations, once made, are guaranteed and cannot later be modified or reduced by Congress. Since you are a fiscal officer, with certain expertise, detail to us the basis for your conclusions. Don’t patronize us by simply telling us we are wrong because you know better.

  • DonS

    Lou @ 66: My tone reflected frustration with your refusal to address the arguments. To have a good discussion, both sides need to engage.

    As a federal fiscal law officer, you should know better than to be using Perry to make your point. As you well know, cases are only law with respect to the facts actually adjudicated. Dicta and innuendo that might be contained in the opinion are not binding. The Perry case dealt with debt instrumentalities, i.e. bonds, duly issued by the United States government. There is no law which holds that appropriations are equivalent to issued debt instruments for the purposes of the 14th Amendment provision guaranteeing U.S. debt. Deal with that, please. Explain to us the law which you believes expands Perry to require that all appropriations, once made, are guaranteed and cannot later be modified or reduced by Congress. Since you are a fiscal officer, with certain expertise, detail to us the basis for your conclusions. Don’t patronize us by simply telling us we are wrong because you know better.

  • Lou

    Cincinnatus,
    “As for other obligations, for which money has not yet been appropriated” No such thing. Under Fiscal Law, any money that has been obligated MUST first be appropriated.
    “The Anti-Deficiency Act (ADA), Pub.L. 97-258, 96 Stat. 923, enacted September 13, 1982, is legislation enacted by the United States Congress to prevent the incurring of obligations or the making of expenditures (outlays) in excess of amounts available in appropriations. It is now codified at 31 U.S.C. § 1341. The ADA prohibits the Federal government from entering into a contract that is not “fully funded” because doing so would obligate the government in the absence of an appropriation adequate to the needs of the contract. This Act of Congress is sometimes known as Section 3679 of the Revised Statutes, as amended.”
    Read more here:
    http://en.wikipedia.org/wiki/Anti-Deficiency_Act

    “But seriously”.
    Oh. Were you trying to be funny? Appeals to authority are certainly not fallacious. Perhaps you meant that my appeal itself was fallacious? Check my IP then. Whatever.

    Come quickly Lord Veith, please.

    Out Here. Have a good time kiddies.

  • Lou

    Cincinnatus,
    “As for other obligations, for which money has not yet been appropriated” No such thing. Under Fiscal Law, any money that has been obligated MUST first be appropriated.
    “The Anti-Deficiency Act (ADA), Pub.L. 97-258, 96 Stat. 923, enacted September 13, 1982, is legislation enacted by the United States Congress to prevent the incurring of obligations or the making of expenditures (outlays) in excess of amounts available in appropriations. It is now codified at 31 U.S.C. § 1341. The ADA prohibits the Federal government from entering into a contract that is not “fully funded” because doing so would obligate the government in the absence of an appropriation adequate to the needs of the contract. This Act of Congress is sometimes known as Section 3679 of the Revised Statutes, as amended.”
    Read more here:
    http://en.wikipedia.org/wiki/Anti-Deficiency_Act

    “But seriously”.
    Oh. Were you trying to be funny? Appeals to authority are certainly not fallacious. Perhaps you meant that my appeal itself was fallacious? Check my IP then. Whatever.

    Come quickly Lord Veith, please.

    Out Here. Have a good time kiddies.

  • Cincinnatus
  • Cincinnatus
  • John N

    Cincinnatus I think we are all on the same page on the long term issue. No question this whole thing is broken and cannot continue.

    The whole issue most folks misunderstand is this not authorizing any new spending, just covering what is already committed to with a little leeway to simple allow the Treasury to have the room it needs to manage the nation’s business.

    The R’s and D’s have been in negotiations and Kyl and then Cantor walked out. There was $2T in cuts on the table and $400B in loophole closings to be agreed upon for revenue a 4 to 1 ratio or so.

    The deal was there and Obama has said a deal is still there but it has to include revenue. We cannot cut our way out this. We spent our way in with unfunded wars and Med. Part D, and tax cuts and then an economy where unemployment cut nearly $500B/yr out of tax receipts.

    The sad thing is that Cantor clearly walked out to make Boehner the bad guy on final agreement and the TP’ers will kill him making it possible to take over as Speaker. So much for helping the nation.

  • John N

    Cincinnatus I think we are all on the same page on the long term issue. No question this whole thing is broken and cannot continue.

    The whole issue most folks misunderstand is this not authorizing any new spending, just covering what is already committed to with a little leeway to simple allow the Treasury to have the room it needs to manage the nation’s business.

    The R’s and D’s have been in negotiations and Kyl and then Cantor walked out. There was $2T in cuts on the table and $400B in loophole closings to be agreed upon for revenue a 4 to 1 ratio or so.

    The deal was there and Obama has said a deal is still there but it has to include revenue. We cannot cut our way out this. We spent our way in with unfunded wars and Med. Part D, and tax cuts and then an economy where unemployment cut nearly $500B/yr out of tax receipts.

    The sad thing is that Cantor clearly walked out to make Boehner the bad guy on final agreement and the TP’ers will kill him making it possible to take over as Speaker. So much for helping the nation.

  • John N

    This chart is a great overview of the issues being debated as to how we got into this mess:
    http://tpmdc.talkingpointsmemo.com/2011/07/chart-of-the-day-out-of-control-spending-not-really-out-of-control-at-all.php?ref=fpblg

  • John N

    This chart is a great overview of the issues being debated as to how we got into this mess:
    http://tpmdc.talkingpointsmemo.com/2011/07/chart-of-the-day-out-of-control-spending-not-really-out-of-control-at-all.php?ref=fpblg

  • Cincinnatus

    John N@77: I generally agree with everything you’ve said in this comment. As I noted, the only thing that’s rendered this situation complicated is the intervention of partisan politics. But in a representative democracy, these are inescapable, so it’s little use complaining about them unless one desire wholesale regime change.

    (I do, but let’s save that for another discussion)

  • Cincinnatus

    John N@77: I generally agree with everything you’ve said in this comment. As I noted, the only thing that’s rendered this situation complicated is the intervention of partisan politics. But in a representative democracy, these are inescapable, so it’s little use complaining about them unless one desire wholesale regime change.

    (I do, but let’s save that for another discussion)

  • John N

    And another forward looking one that shows the sources of the deficit:
    http://tpmdc.talkingpointsmemo.com/2011/05/chart-bush-policies-dominant-cause-of-debt.php

  • John N

    And another forward looking one that shows the sources of the deficit:
    http://tpmdc.talkingpointsmemo.com/2011/05/chart-bush-policies-dominant-cause-of-debt.php

  • John N

    Cincinnatus – You have been a great man since Roman Times…and my family is in Cincinnati this week seeing family! :-)

  • John N

    Cincinnatus – You have been a great man since Roman Times…and my family is in Cincinnati this week seeing family! :-)

  • Cincinnatus

    Excellent! Cincinnati is a fine city, though I don’t live there myself.

    But I have to take issue with your comment @80. Specifically, it’s pointless. I think everyone is pretty generally aware of the causes of our current deficit, not to mention the debt and entitlement crises, whose roots lie in the 1960s Great Society programs. It’s long past the time when blaming one another for the deficit is a discussion that is in the remotest way useful.

  • Cincinnatus

    Excellent! Cincinnati is a fine city, though I don’t live there myself.

    But I have to take issue with your comment @80. Specifically, it’s pointless. I think everyone is pretty generally aware of the causes of our current deficit, not to mention the debt and entitlement crises, whose roots lie in the 1960s Great Society programs. It’s long past the time when blaming one another for the deficit is a discussion that is in the remotest way useful.

  • John N

    And finally the history of the debt ceiling over the last 31 years:
    http://bentelligence.files.wordpress.com/2011/07/800px-us_public_debt_ceiling_trillions.png

    Does beg the question why now is a crisis when it was raised 7/8 times with no question while we sent from surplus to $11.3T before Obamas’ first budget.

  • John N

    And finally the history of the debt ceiling over the last 31 years:
    http://bentelligence.files.wordpress.com/2011/07/800px-us_public_debt_ceiling_trillions.png

    Does beg the question why now is a crisis when it was raised 7/8 times with no question while we sent from surplus to $11.3T before Obamas’ first budget.

  • John N

    But look at the real causes of the debt the last 10 years.

    That really contradicts what you just said. The largest jump in constant $$ is defense, unfunded wars + and then some in Medicare/medicaid but that will include Med D.

    Also the Bush Tax cuts are really the largest issue along with loss of taxes due to economy/unemployment.

    it clearly is not the “Great Society” but wars, tax cuts and unfunded drug programs.

  • John N

    But look at the real causes of the debt the last 10 years.

    That really contradicts what you just said. The largest jump in constant $$ is defense, unfunded wars + and then some in Medicare/medicaid but that will include Med D.

    Also the Bush Tax cuts are really the largest issue along with loss of taxes due to economy/unemployment.

    it clearly is not the “Great Society” but wars, tax cuts and unfunded drug programs.

  • Cincinnatus

    Huh? I didn’t say that Medicare was the cause of our deficit; it’s the cause of our impending entitlement crisis (along with Social Security)–$60 trillion in unfunded liabilities! Our debt and deficit concerns are small potatoes in comparison.

    The wars are funded, but with deficit spending. Yes, I’m opposed to the wars, and they’ve done their part to explode the debt. But they’re funded.

    The chunk dealing with Bush tax cuts is a spurious estimation. Total income tax revenue, until the recession in 2008, actually increased every year after the cuts were implemented under Bush. So that portion of the graph is really an educated guess, assuming a) that the Laffer curve is invalid (i.e., that revenues rose under Bush for unspecified reasons other than the tax cuts) and b) that numerous other variables would be held constant to ensure that taxed activities continue at the same rate even after a tax increase. So it’s kind of a fantasy, which is why I always take news from the CBO and the GAO with a generous dose of salt.

    I completely agree that tax increases (not revenue increases: revenue increases are never guaranteed no matter how much you raise taxes) should not be off the table, but that chart is little more than a partisan slap. And I’ll be the first to criticize the Bush administration otherwise.

  • Cincinnatus

    Huh? I didn’t say that Medicare was the cause of our deficit; it’s the cause of our impending entitlement crisis (along with Social Security)–$60 trillion in unfunded liabilities! Our debt and deficit concerns are small potatoes in comparison.

    The wars are funded, but with deficit spending. Yes, I’m opposed to the wars, and they’ve done their part to explode the debt. But they’re funded.

    The chunk dealing with Bush tax cuts is a spurious estimation. Total income tax revenue, until the recession in 2008, actually increased every year after the cuts were implemented under Bush. So that portion of the graph is really an educated guess, assuming a) that the Laffer curve is invalid (i.e., that revenues rose under Bush for unspecified reasons other than the tax cuts) and b) that numerous other variables would be held constant to ensure that taxed activities continue at the same rate even after a tax increase. So it’s kind of a fantasy, which is why I always take news from the CBO and the GAO with a generous dose of salt.

    I completely agree that tax increases (not revenue increases: revenue increases are never guaranteed no matter how much you raise taxes) should not be off the table, but that chart is little more than a partisan slap. And I’ll be the first to criticize the Bush administration otherwise.

  • Rob

    I think many who have commented have confused the word “spending” with the words “paying” and “debt”. The President, by envoking the 14th. Amendment is not “spending” money or incurring new debt. That is clearly the perview of the Congress. The President is merely paying a previous debt previously authorized by Congress, which I beieve he has not only the authority to do, but he is required to do.

  • Rob

    I think many who have commented have confused the word “spending” with the words “paying” and “debt”. The President, by envoking the 14th. Amendment is not “spending” money or incurring new debt. That is clearly the perview of the Congress. The President is merely paying a previous debt previously authorized by Congress, which I beieve he has not only the authority to do, but he is required to do.

  • DonS

    Rob @ 86: I don’t know whether you realize that this thread is a year and a half old, but President Obama now acknowledges that he has no authority under the 14th Amendment to exceed the debt limit: http://www.politico.com/politico44/2012/12/white-house-rules-out-th-amendment-option-on-debt-151305.html

    It’s a dead issue.

  • DonS

    Rob @ 86: I don’t know whether you realize that this thread is a year and a half old, but President Obama now acknowledges that he has no authority under the 14th Amendment to exceed the debt limit: http://www.politico.com/politico44/2012/12/white-house-rules-out-th-amendment-option-on-debt-151305.html

    It’s a dead issue.

  • http://none Bill Dixon

    Knowing that our Founders meant good I do believe their mouth may have written a check that our rear ends can not cash.

  • http://none Bill Dixon

    Knowing that our Founders meant good I do believe their mouth may have written a check that our rear ends can not cash.


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