Debt Ceiling, the President and the 14th Amendment

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.

U.S. Constitution 14th Amendment Section. 4.

As I write this post the on-again off-again vote on Rep. John Boehner’s most recent proposal – depending on your point of view — to cut the deficit or increase the statutory debt limit, fills almost the entire House of Representatives agenda.    Even if the bill were to pass the Republican dominated House, it seems unlikely that it would pass in the Senate.  Even if it did pass both houses President Obama has already said that he would not sign it into law.  That being the case what else might happen?  Could, for instance, the President act unilaterally to prevent the debt ceiling from hitting the limit?

First, a bit of background. While a narrow reading of the Article 4  suggests that only Civil War debts must be paid, in Perry v. United States 294 U.S. 330, Chief Justice Charles Evans Hughes rejected the narrow reading, stating ,“… its language indicates a broader connotation.”

Surprisingly little exists in law journals explaining the public debt clause. In Train Wrecks, Budget Deficits, and the Entitlements Explosion: Exploring the Implications of the Fourteenth Amendments Public Debt Clause,”   Georgetown University law professor Michael Abramowiz explores at length the public debt clause from various viewpoints: including among others, legislative history, jurisprudence, linguistic evidence of meaning, various acts that might trigger use of the clause, and legal actions that might be taken should the government stop paying its debts.  Although the article is very recent in does not seem to contemplate issue of whether the president can act unilaterally.

Some commentators, including former President Clinton, suggest that the President could act unilaterally raise the debt ceiling in order to avert default.  Clinton argues that if he were president he would unilaterally raise the debt ceiling and placing the burden on the courts to stop him.  “I think the Constitution is clear and I think this idea that the Congress gets to vote twice on whether to pay for [expenditures] it has appropriated is crazy,” Clinton added.

Last Friday, the President answering a similar question stated “I have talked to my lawyers, Mr. Obama said, they are not persuaded that that is a winning argument.

As recently as Monday, July 25th, answering the question whether President Obama  could “use the constitutional option,” White House Press Secretary, Jay Carney, responded:

“[I]t’s not available. The Constitution makes clear that Congress has the authority — not the President — to borrow money. And only Congress can increase the statutory debt ceiling. That’s just a reality.

You can have an esoteric discussion about constitutional law and what could not or should not be changed — but we don’t — we don’t have the luxury or the time. The law is as it is, that’s how we view it, and that’s why we have to reach a compromise.”

But is it really the case that the President is powerless to act?  While it would certainly provide political cover for Congress were the president to take the entire blame for cuts in social programs, the Congressional argument seems to be even though we [Congress] appropriated too much, now we would prefer to not pay the tab.  One can almost imagine Congressmen running through the halls of the Capital shouting “Stop us before we spend again!”

The blogosphere is now afire with law professors arguing the merits of presidential action in the face of Congressional paralysis.  In a New York Times Op-Ed, Eric A. Posner and Adrian Vermeule, law professors at the University of Chicago and Harvard respectively, argue that “Obama Should Raise the Debt Ceiling on His Own.” 

Harvard University law professor Laurence Tribe and George Washington law professor Neil H. Buchanan wrestle with the issue in a post, reply and rejoinder.  Follow the links at Dorf on Law

On Balkanization, Yale law professor Jack Balkin has written ten recent blog posts on the issue, including a legislative history of section four of the 14th Amendment,  and one in which he explains why Clinton would act unilaterally and Obama won’t.   One post considers avoiding the issue by the President ordering the Treasury to coin several trillion dollar coins.  In Under What Circumstances Can the President Ignore the Debt Ceiling  Balkan looks to the President to act as a default in an emergency subject to Congressional retroactive authorization.

For up to date coverage the independent non-profit public interest investigative reporting site, ProPublica, maintains a daily updated “A Reading List for Following the Debt Ceiling. Drama”  

Today’s New York Times Legal Memo discusses “the 14th Amendment, The Debt Ceiling and a Way Out.

Next Tuesday, August 2nd, is the date the debt will hit the ceiling.  At that point absent Congressional and presidential action the US will be unable to pay all its bills. Whatever happens we will soon discover how this crisis plays out.               Carl Yirka

29 July 2011

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One thought on “Debt Ceiling, the President and the 14th Amendment

  1. Marc Perkel July 29, 2011 / 5:36 pm

    It isn’t so much the 14th amendment but the fact that Congress has already passed a debt increase implicitly. Whenever congress passes a budget with more spending than revenue then they understand that the national debt will increase. So Congress already approved it and doesn’t need to approve it twice.

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