The debt limit canard

Great is the gnashing of teeth over what is possibly the greatest own goal in all federal law: the debt limit. The US Congress has separate processes by which it authorizes taxation, spending, and borrowing. This opens up the possibility that Congress could mandate spending for which it has failed to create enough tax revenue–and then turn around and prohibit the government from borrowing enough money to pay the bills Congress itself has generated.

The predicted consequences of that gambit are severe. Per the US Treasury:

Failing to increase the debt limit would have catastrophic economic consequences. It would cause the government to default on its legal obligations – an unprecedented event in American history. That would precipitate another financial crisis and threaten the jobs and savings of everyday Americans – putting the United States right back in a deep economic hole, just as the country is recovering from the recent recession. 

That’s the rosy view. Most economists think a default would create a global, not a national, recession.

Usually, Congress makes some grumbly noise and raises the debt limit, since nobody with a conscience wants to cause a global recession. Enter the Tea Party in 2011: They demanded–and won–serious concessions from Obama in order to raise the limit. Now the Freedom Caucus is at it again (hey, Democratic President, let’s cause a recession!), threatening to hold up the debt limit unless Biden agrees to various shit he will never agree to. 

Biden should categorically refuse to negotiate on the issue. What’s the saying? Oh yeah, you don’t negotiate with terrorists. Not only that, but he has the upper hand. Pundits have suggested various workarounds, like printing a trillion dollar coin, but IMO that’s not necessary. Biden can simply tell them, “Go fuck yourselves, I am going to pay the bills regardless of whether I exceed the debt limit. Sue me if you don’t like it.”

That would give the Freedom from Responsibility Caucus three choices: raise the debt limit; don’t raise the debt limit but don’t do anything about it; or sue Biden in court.* The latter would put them in the position of asking the Supreme Court (ultimately) to tank the world economy. And they would lose. They have legislation on their side; Biden would have the Constitution on his side: “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” (14th Amendment).

Constitution beats legislation every time. 

Don’t negotiate with terrorists. Especially when you don’t have to.

(this opinion provided by Dan T. What do you think?)

*ETA: Or they could impeach him. Which history shows would only have the effect of rallying the country around Biden.