A conflict of law, and how to resolve it
January 10, 2013 2 Comments
Yesterday, I went after Best of the Web columnist James Taranto for what I gathered was him intentionally confusing the debate over the debt ceiling increase, making it appear that President Obama wanted to add to the debt as opposed to ensuring that the United States could pay the obligations Congress had already made on the nation’s behalf.
But there is a point in he makes in the column that is intriguing:
What would happen if Congress failed to raise the debt limit is that the government would be unable both to pay off existing bondholders and to spend all the money Congress has ordered. That would create a conflict of law.
That got me thinking. If the GOP does the unthinkable and refuses to increase the debt ceiling, there will be a conflict of law, as Taranto says. On the one hand, you have the law passed in the early 20th century that set up an arbitrary ceiling on the debt the Treasury Department could hold in order to pay the government’s bills. On the other hand, you have every other single law ever passed that either raised revenue or spent money.
One very awkward solution — though not as awkward as minting a trillion dollar coin or pretending the 14th Amendment says something it does not — would be for the president to go on live TV and say something along these lines:
I have something important to say to my fellow Americans, to the global economic community and to anyone who ever bought a Treasury bond. Because of the gross irresponsibility of congressional Republicans, I am faced with a difficult choice. Either decision I make will break the law and undermine the Constitution. I can either accept the law setting the debt ceiling at the current level, which we have reached, or I can ignore that law.
If I accept that law, I must break literally hundreds of others. I must renege on obligations Congress made to the people of this nation. I must shut down essential services authorized by Congress. I must risk defaulting on the full faith and credit of the United States because, frankly, the federal government is an enormous machine and ensuring that some of our creditors get paid while others get stiffed is an order of magnitude more complex than most people appreciate.
Not only that, however, I will be putting the executive branch in the position of making what are clearly legislative branch decisions. I do not have the authority to decide what programs to fund and what programs not to fund. That’s Congress’ job, not mine. By refusing to pass an increase on the debt limit, Republicans in Congress have unconstitutionally shifted that responsibility, that power, to me. I don’t want it, and it is not my power to exercise.
Therefore, I’ve decided that if I must break the law and undermine the Constitution, I will do so in a way that is least disruptive to the global and American economies and to the American people, and in the way that involves less executive overreach: I have instructed my Secretary of the Treasury to ignore the statutory debt limit and to issue bonds in the amount necessary to keep the government functioning and to honor the legislative intent of every other law passed by Congress.
Let me be clear: This is not a choice I make lightly. But it is a decision that has been forced upon me. If Congress does not approve, then it can either cut the spending it has approved, raise more revenue or increase the debt ceiling.
In other words, Congress can do its job.
Thank you, good night, and may God bless America.
Update: Just to be perfectly clear, I realize such an announcement by the president is completely unrealistic. It would roil the bond markets. Who would buy Treasury bills under such a cloud? It’s just a thought I had in reaction to Taranto’s point. If you have conflicting laws, who says the law that causes the most turmoil and destruction ought to win? A constitutional law scholar could probably tell me a dozen ways this scenario is unworkable. Of course, equally unworkable is the Republican willingness to refuse to increase the debt ceiling if they don’t win spending concessions. Unfortunately, that isn’t imaginary.