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Can President Obama Raise The Debt Ceiling On His Own?
Originally published on Tue October 8, 2013 4:37 pm
Some legal scholars are making the case that President Obama should raise the debt ceiling on his own, without congressional approval. They are basing their argument on the 14th Amendment, which was passed after the Civil War to make sure the Union paid its debts.
Section 4 of the 14th Amendment says: “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.”
Emily Bazelon, legal affairs editor for Slate and senior research fellow at the Yale Law School, agrees with that argument.
“The president has emergency powers he should invoke to prevent default,” Bazelon told Here & Now. “Also, when choosing among different mandates from Congress, i.e., spending the money they budgeted to spend, and then not raising the default ceiling, he can go with the first obligation. But before that, first and foremost, Congress has an obligation under the 14th amendment not to call the nation’s debt into question. The president should be strongly making that argument. He has not been.”
The White House disagrees. Press Secretary Jay Carney said last week, “Look, our view is the Constitution gives Congress — not the president — the authority to borrow money, and only Congress can increase the debt ceiling, which is why it’s time that they do their job and raise the debt ceiling, authorize the Treasury to pay the bills that Congress racked up.”
Joseph Reisert, associate professor of constitutional law at Colby College, tells Here & Now he does not think that’s right.
“As a practical matter, were the president to say well, we’ve clearly hit this moment of national emergency. It appears that the inaction of Congress is going to call into question our credit worthiness, therefore I on my own authority are going to tell the Treasury to keep selling bonds. Well suppose the president does that and you’re an investor? Do you really want to buy those bonds not explicitly authorized by law in the ordinary sense. You might get your money back but you might not.”
The debate continues.
- Joseph Reisert, associate professor of constitutional law at Colby College.
ROBIN YOUNG, HOST:
From NPR and WBUR Boston, I'm Robin Young.
JEREMY HOBSON, HOST:
I'm Jeremy Hobson. It's HERE AND NOW. Coming up, could President Obama raise the debt ceiling without congressional approval? Some legal experts say yes.
YOUNG: But first news today that President Obama will hold a press conference this afternoon, taking questions from reporters. Earlier today, House Republicans lined up at a microphone to call on the president to negotiate. Here's speaker John Boehner.
REPRESENTATIVE JOHN BOEHNER: All we're asking for is to sit down and have this conversation. There's no reason to make it more difficult to bring people to the table. And so there's no, there's no boundaries here. There's nothing on the table; there's nothing off the table. I'm trying to do everything I can to bring people together and to have a conversation.
YOUNG: Well, after that lineup of Republicans, President Obama did have a conversation with the House speaker by phone. NPR's Tamara Keith joins us from Capitol Hill. Tam, do we know any more about that phone call? I believe that's the first interaction between the president and the House speaker in a while.
TAMARA KEITH, BYLINE: In a while, though they have had other conversations that as far as I can tell went pretty much precisely like this one. We got a readout from the speaker's office, that came first, and he - a spokesman for the speaker says, quote, the president called the speaker again today to reiterate that he won't negotiate on a government funding bill or a debt limit increase.
The White House then sent out its own readout. It had more words, but it basically said the same thing. They're in the same place they were days ago, weeks ago.
YOUNG: Well, and what about the press conference this afternoon? It's just been announced. What's the sense of - is that just more of the one hits the tennis ball over the net, and the other hits it back?
KEITH: I don't even know if they're hitting tennis balls. I don't know that they're on the same court right now. I think that, you know, we will hear from the president pretty much saying most likely what he said to the speaker which is I'm happy to talk to you about anything you want to talk about, we can talk about the Affordable Care Act, we can talk about entitlement spending, the debt, the deficit, anything you want, but first you have to do this thing you don't want to do, which is reopen the government and raise the debt ceiling, which would give up all the leverage that the speaker has right now.
YOUNG: Well, again to remind people because it's - they've become conflated, the White House has said they want this clean spending bill that doesn't include any cuts to the Affordable Care Act, and this is about allowing money to be freed to be spent now. But then there's the spending that's already taken place. This is the debt ceiling. This is the country's debt. Countries always have debt. They borrow to pay off the money they've already spent, and the debt ceiling in the case of the U.S. would have to be raised to do that.
And that has to happen October 17. We're hearing that there's moves among Senate Democrats to have some sort of bill that they might propose as soon as today on the debt ceiling. What's that all about?
KEITH: Senate Democrats are planning to introduce a bill today, it would take several days to work through the process, possibly way more than several days, that would cleanly raise the debt limit for a year, basically say all this - all of these programs, all of this stuff that we've authorized, we can keep spending that money.
The deadline, this October 17th, isn't quite as hard a deadline as we might think of it. Basically that's when our credit limit runs out, and we can't spend any more money on our credit card, but we still we have about $30 billion in pocket cash. From day to day, that may not actually cover the bills.
YOUNG: OK, so right now we are right now once again sort of where we were hours ago except that a little bit more talking and again the president holding a press conference this afternoon to answer questions. NPR congressional correspondent Tamara Keith, following it all for us. Thanks so much.
KEITH: You're welcome so much.
HOBSON: And as you say, Robin, we are marching toward that debt ceiling deadline, October 17th. So what happens if Congress does not raise the debt ceiling by then? Could President Obama continue borrowing without that approval? Well, some experts in constitutional law say the 14th Amendment gives him that authority. The amendment was passed after the Civil War, and it was meant to ensure that the Union would pay its debts.
It reads, quote, the validity of the public debt of the United States, authorized by law, including debt incurred for payments of pensions and bounties for services and suppressing insurrection or rebellion, shall not be questioned. For more on this, let's bring in Joseph Reisert, associate professor of constitutional law in the Department of Government at Colby College. He's with us from Waterville, Maine. Professor, welcome.
JOSEPH REISERT: Thank you, it's good to be here.
HOBSON: Well, does President Obama have the constitutional authority to continue borrowing even if Congress does not raise the debt ceiling?
REISERT: Well, this is a matter of some dispute among constitutional law professors, but I have to say that my answer would be no.
HOBSON: No, he does not. Why not?
REISERT: No, he does not. So Article 1, Section 8 of the Constitution lists among the powers of Congress the power to borrow money on the credit of the United States. So we're all agreed that in the ordinary case, it's Congress that gets to authorize the issuance of the public debt.
The argument has been made, though, that Section 4 of the 14th Amendment, which provides that the validity of the public debt of the United States authorized by law shall not be questioned, that that provision by establishing a kind of special importance to the sanctity of the debt of the United States might authorize the president in a sort of emergency situation, where the inaction of Congress seemed to call into question the validity of the debt in violation of the constitutional guarantee, that might seem to create an opportunity for the president to exercise a kind of emergency power.
HOBSON: But you don't agree with that.
REISERT: Well I guess no, I don't and for two reasons, one in practice and one as a matter of principle. As a practical matter, were the president to say, well, we've clearly hit this moment of national emergency, it appears that the inaction of Congress is going to call into question our creditworthiness, therefore I on my own authority are going to tell the Treasury to keep selling bonds, well suppose the president does that, and you're an investor.
Do you really want to buy those bonds not explicitly authorized by law in the ordinary sense? I mean, you might get your money back, but you might not. So I think as a practical matter, it's not likely to be a workable solution.
And in principle, the argument for emergency power there is really relying, I think, not so much on the text of Section 4, which on its face doesn't empower the president to do anything, it really rests on a much more general understanding that the president ought to be able to act when the nation is facing something terrible to save the country. Or it's a sort of general, inherent emergency power kind of claim.
But that argument only works, I think, if the effort is going to succeed or has some reasonable chance of succeeding, and I guess I don't - I don't see that the president-authorized bonds are likely to meet the emergency in any case.
HOBSON: Well, and it appears that the president's press secretary agrees with you. I want to play something from a recent White House press briefing, Jay Carney is talking about how the Obama administration is looking at this question. Let's listen.
JAY CARNEY: Look, our view is the Constitution gives Congress, not the president, the authority to borrow money, and only Congress can increase the debt ceiling, which is why it's time that they do their job and raise the debt ceiling, authorize the Treasury to pay the bills that Congress racked up.
HOBSON: So professor, what about the idea that's been floated of minting a trillion-dollar coin?
REISERT: Good heavens. So as I understand it, there is a statute out there that authorizes the Treasury to issue coins in any denomination, and the upshot of that is so in principle the Treasury could decide that some little hunk of platinum is going to be worth a trillion dollars and put it in the account of the United States government and then have the government sort of pay its regular debts on the basis of having a trillion dollars there.
That seems like it's too clever by half in the sense that the markets will understand that it's just a kind of phony inflationary manufacturing of money out of nothing, and either we're going to actually return to the ordinary sale of bonds to finance our debt, or we're going to have some terrible crisis, I think.
And I wonder if it just wouldn't spook the markets even more than just admitting we're going to have to prioritize payments and try to pay what we can because the inflows don't match the outflows.
HOBSON: So just to be clear, what you're saying is that the only way out of this, really, is for a deal to be made between the two sides. There's nothing the president can do on his own if Congress doesn't raise the debt ceiling.
REISERT: It's hard to see what he could do. The Republicans in Congress insist that he ought to be prioritizing with the revenues coming into the Treasury payment of interest and principal on the debt, on the theory that our inflows ought to cover those expenses, and then what that would mean is paying either with IOUs or just deferring payment or going late on all the other kinds of obligations that the government has to pay.
So that might avoid the worst kind of default in the marketplace, but it would still be failing to pay our bills.
HOBSON: Would it be constitutional for the president or the administration to decide which bills to pay?
REISERT: Well, here's the problem. So the president has a constitutional duty to take care that the laws be faithfully executed. The problem is he'd be presented with a situation where Congress on the one hand says on an ongoing basis you need to pay out all of this money, and you need to pay out more money than we're taking in in taxes.
And there's another law over here that says but there's a limit to how much you can borrow. Well, the commands of those two laws conflict with one another, and that's really the source of the problem we're in right now. So I guess I am appealing, in a way, to a sort of inherent emergency power of the president.
He's been told to take care that two conflicting laws be enforced. To prioritize payments would be one way for him to try to resolve what's really an impossible situation he's put in.
HOBSON: Do you think that this, combined with the government shutdown, represents a constitutional crisis?
REISERT: Constitutional crisis is a strong word. I don't think we expect our form of government to come crashing down. It's obviously not a good thing when instead of the ordinary process of negotiation we have negotiation seemingly broken down such that both sides are entrenched in positions with the result that we're letting the government or parts of the government go unfunded and potentially facing a default.
So that's very bad. Would I call it a constitutional crisis? I'm not sure.
HOBSON: Well, what would you call it?
REISERT: Sort of a terrible breakdown in our ordinary political system.
HOBSON: Joseph Reisert is associate professor of constitutional law at Colby College. Professor, thanks so much for joining us.
REISERT: It's been my pleasure.
YOUNG: And here are some other stories we're following that don't include the words government shutdown. After a rocky rollout, the website to help Americans sign up for health coverage under the Affordable Care Act is now working faster. The Obama administration says the tech system buckled under unexpected high traffic.
But healthcare.gov's glitches don't stop there. There are problems with the software, as well, and there will be late-night shutdowns to try to speed things up. Also the holy grails of medical research have long been curing cancer and heart disease, but a new study suggests that research into delaying aging shows more promise in extending life spans. We'll have these and other stories later today on ALL THINGS CONSIDERED. Back in a minute to try to explain the Higgs particle, HERE AND NOW. Transcript provided by NPR, Copyright NPR.