…to bring you this: “U.S. Cannot Constitutionally Default on Its Debt, Says Constitutional Scholar”:
The United States cannot constitutionally default on its existing public debt even if the debt ceiling is not raised, constitutional scholar and attorney David Rivkin said during a Federalist Society news event. Instead, he said, the country should focus on the fiscal responsibility of new borrowing.
“The United States, to put it more clearly, is one of the few countries in the world that is technically incapable of defaulting on its public debts, so we cannot have a situation like in Greece or Portugal or Ireland, ” Rivkin, co-chairman of the Center for Law and Counterterrorism, said during a telephone conference call sponsored by the conservative legal group on July 7.
Section Four of the 14th Amendment to the Constitution of the United States says that “[t]he 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.”
Under the 14th amendment and applicable case law, the government is not allowed to default on the public debt, according to Rivkin.
“It means the following: that the default on public debt which, indeed, if it would occur, would be quite horrific, is a misnomer. It cannot happen, it will not happen, even if no debt increase of any kind takes place,” he said.
Commenting on the amendment, Rivkin explained: “(The) language of the14thh amendment is pretty clear. It applies only to the true public debt of the United States. It does not apply to the wide range of common litigations, and that point ought to be emphasized because I think there has been quite a bit of confusion about it.”
In realistic fiscal terms, there is no need for the government to default on the debt–by failing to pay the interest it owes on that debt–because onging federal tax revenues far out-strip ongoing interest payments. So far this fiscal year (through July 11), for example, the federal government has brought in $1.647687 trillion in tax revenue, while needing to pay out $150.837 billion in interest on the debt.
Tax revenues this fiscal year, in other words, have outstripped the required interest payments by more than 10-to-1.
Hypothetically, to put itself in a position where it would have defaulted on the interest owed to bond-holders in this fiscal year, the government would have needed to decide to pay almost $1.5 trillion in other expenses first–and thus exhaust federal revenues–before it paid the interest on the debt.
Along with the 14th amendment, several Supreme Court decisions, including in the 1935 case Perry v. United States, have established that Congress cannot renege on its stipulated bond payments, Rivkin said.
As the majority opinion in Perry reads, “[b]y virtue of the power to borrow money ‘on the credit of the United States,’ the Congress is authorized to pledge that credit as an assurance of payment as stipulated–as the highest assurance the Government can give, its plighted faith.”
“To me, that suggests that the real issue in play is not, repeat, not the default on existing debt,” Rivkin said.
If you are a GOP leader, why not print this out and wear it like a fucking hat? And when some media type mentions default, etc., in that breathlessly hyperbolic way they have, just take off your new hat, unfold it, and read it to them. Slowly. With conviction.
Seems simple enough, doesn’t it?
Then tell them you’re walking away from any negotiations, and that you’re going to pass a budget calling for massive cuts in spending, because we simply don’t have the money to pay for all the programs the federal Leviathan keeps implementing.
And the cuts you propose won’t include cuts to Social Security or military pay, either.
This is all fine and dandy, but what makes anyone think this administration will obey the law? And, if they don’t what are you going to do about it? Obama will thumb his nose and do whatever he wants. Laws mean nothing to a tyrant.
A song for the GOP
He has all along, but in this it can’t be fudged or fobbed off though he will try mightily. There is clarity and light to be found and the rats and roaches will lose their ability to hide.
I don’t think he’ll follow the law, and I don’t think there’s much we can do about it if he doesn’t. Except revolt. And I’m down with that.
I just want to publicize beforehand why.
That’s what elections are for Jabez.
There will be more of this.
“Washington gets $200 billion a month, Social Security costs $50 billion a month, and Obama is threatening to starve Grandma?”
Too much common sense Jeff. That is why they can’t handle you. Well, that and the cock slaps. But they deserve it.
In other news, I can totally get behind this South California proposal.
David Rivkin may fancy himself a Constitutional scholar, but everybody knows that Obama is the most wise Constitutional scholar of them all. We know it because we’ve been told it. A lot.
So Obama can’t guarantee that the geezers will get paid, while the constitution forbids the stiffing of said geezers?
Or put another way, if the constitution guarantees it, Obama might not be able to.
Some dicks are just dicks. That’s how they do.
If the geezers hold Treasury bonds, then no, they can’t be stiffed. If they hold imaginary IOUs from the “Social Security Lock Box,” then they’re just screwed. The SS IOUs fall under the “wide range of common litigations” Rivkin mentions.
@Alppuccino, From the way I read this, only legally binding debt issued by Congress is defended here. We go down the rabbit hole when we look to define a debt other than say issued bonds. Is an employment contract a debt of the government? Entitlement payment? Rent of Government offices around the country?
What I think will come out of this debacle is a real exposure of just how large the government really is, just how intrusive. Also, people will finally realize the smoke and mirrors that defines the ponzi scheme we call Social Security.
I’m starting to think that this reading of the 14th Amendment allows the President to arbitrarily ignore the debt ceiling, then it would allow a so inclined future President to make any cuts to spending in the name of preventing default.
Dicentra I’m totally on board with splitting a TEA party state off from California. Why? Why not?
The highest-paid state employee in California last year, a prison surgeon who took home $777,423, has a history of mental illness, was fired once for alleged incompetence and has not been allowed to treat an inmate for six years because medical supervisors don’t trust his clinical skills.
That’s not what it means Madsci. What it means is that On Aug 3, the debt gets serviced, and Life Goes On, as far as the financial markets are concerned. If Obama decides to blow the rest of the monthly tax take on snail darters and poety festivals, instead of paying social security and military pay, that’s on him.
The House could vote to repeal Obama Care. How much room would that free up vis-a-vis the debt ceiling?
Ernst, I think I heard yesterday ObamaCare is a bit over $1T in near term costs. ‘Course, the question of an actual cut is moot here, though the repeal gesture has a nice value all its own.
sdferr, it’s all gesticulating theatrically at this point. All of it.
Pretty much, though the nose to grindstone work in the various House committees of jurisdiction seems real enough to me, despite that their ultimate work product doesn’t go anywhere past the Senate.
I might have posted a related question on a dead thread.
Any thoughts on this, guys?
(To tighten up the question a bit, I’m not referring to what should be done were one of us in his position, I’m questioning the President’s authority to make such decisions past debt service and, possibility, entitlement funding.)
Typo: possibly not possibility.
I don’t have a proper sense of the legalities of payments bh. But in a general sense, assume that the Treasury pays out the dough to the various agencies of the executive branch as well as the other functions of government, and further, that the Treasury being in the executive itself it falls under the President’s power to direct at least with regard to executive agencies (so not, for instance, forbidding Treasury to pay the Congress or the Courts). Whether the Congress can write into appropriations bills limitations on those powers is the question I guess, huh? That is, how the dough is dispersed, in what order of necessity and so on? So if the Congress does write in a limitation, the President signs the bill making it law, then it would seem he’d have to abide by any such guidelines.
Isn’t it possible that this limitation is inherent? The executive doesn’t have the power of the purse, the legislature does. That limitation might have been hidden from view by the fact that this hasn’t happened before but I don’t understand why this isn’t the legislature’s job.
Fund this, then fund this, then fund this, etc. That’s what those various committees are doing in the legislature in the normal course. Why then, with a shortfall, would this power suddenly shift to a different branch?
I’d assume that in particular instances it is already there, and already acted on. The question is what happens where the legislature hasn’t bothered itself to specify, which I’d assume also happens a lot. But I’m no lawyer, nor historian of law, so damned if I know.
Princess c*ntbag is at it again.
To my mind then, that’s a tacit agreement where the legislature says, “Here, take this money and apply it to this or that budget as you see fit.” But, if there is no agreement (as is currently the case; no budget from the House to the Senate to the President) then I’d say that it would properly fall to the House to present a priority list or a budget that could balance without further borrowing.
Same here. I just keep seeing this assumption that the executive gets to prioritize payments and I’m not sure that’s correct.
Jesus, what a moron this woman is.
Sorry, I phrased that poorly. The tacit agreement would be more like, ““Here, take this money and apply it within this specific departmental budget as you see fit.”
Yep bh, that’s what it looks like, though with the proviso that the appropriation may be calling at the same time for heaps of specified aims and structures (of offices, terms, organizations, etc.) which in being so detailed may provide the necessity driving the spending under law.
Oh, and it’s of course only the pretend necessity of human moral creation (in the Kantian sense), not, like, real necessity.
Thanks to all for the deserved corrections.
Clearly I used over 20 words when just a few would have sufficed:
Obama’s an idiot.
“I just want to publicize beforehand why.”
It’s only natural, and a fine tradition.
(“When in the Course of human events it becomes necessary for one people to dissolve the political bands which have connected them with another and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature’s God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation.”)
Feinberg really is a fucking tard they should give her tenure before someone else snatches her up
Our professor friend is not exactly the crunchiest pickle in the jar, is she?
You know what I like about the House passing a law directing the order in which payments are met?
The Democrats will start accusing us of attempting to earmark the entire federal budget!
Stoopid hypocrit teabaggers.
As the old line goes, that’s funny because it’s true, Ernst. It might take them a day or two to think of it but I could definitely imagine that line coming out in the talking points.
Fer Chrissakes! What do you expect from a glorified home economics instructor?
Someone who went to Rutgers and knows how to access these things told me that she makes $160K – roughly what congresscritters make while having to maintain two residences. One might ask what a little state employed home economics whore is doing in an expensive restaurant at all, and why she’s so grossly overpaid while poor people are hurting in NJ?
\
3 credits for this?
Love and Money
sheesh! At $319 per credit hour, that’s $957 (or $1984 for non NJ residents).
Meanwhile, the repubs drink the tears of THE CHILDREN!
So you want someone to “Feinberg”, Susan?
Having just read her article summarizing the location theory of multinational corporations, I can assure you that “Love and Money” is exactly the quality of scholarship you can expect from our esteemed Dr. Feinberg. It breaks my heart that she got her doctorate from the Carlson School. They’re supposed to be better than that.
“How much Federal spending is borrowed for every dollar.” by Veronique de Rugy a real economist unlike the ones Slo-Joe Biden uses.
I see Obama is setting records in this chart.
That would be nice, Geoff. Winger prankster James O’Keefe is a Rutgers alum, and I just have to imagine that punking her is his next goal in life.
They’re supposed to be better than that.
God bless Jeff and the rest of Team WingerJew, but it’s kind of a tribal pathology.
Suppose they gave a shutdown and no one came?
We’ll be seeing more articles addressing the ordination of payments. Here’s one anyhow.
OBAMA “ABRUPTLY” WALKS OUT On Republicans in Debt Talks (Video)
Here’s this, from Danger Dave.
From sdferr’s link.
Did Carney just call Republican’s Nazis? Why yes he did.
Fuck Carney.
Is it true Minnesota mint run out of booze?
Sounds like they will have booze but no legal way to buy or sell it.
Also from the same link.
If someone had told me back in 2006 that we would have to keep the Federal government running for over two years without a budget I’d have said that was something that couldn’t happen as it would not work for that long.
And I’d have been wrong.
Passing a budget?! Nonsense.
I feel bad for Squid. I am buying a pitchfork.
Sounds like a business opportunity.
Or a political one for the civilly disobedient inclined.
Oh well. Guess you’re going to have to cut funding to some of those obligations then. That 125% increase to the size of the EPA over the last couple years might be a good place to start.
But what you do have is the money to pay the minimum payment on your government credit cards. That’s the debt service. So stop pretending otherwise.
You know what – hold my military pay – I’ll serve for free until O! gives in. I didn’t join for a #$%&ing paycheck, I joined to keep this country free. If that means missing a few checks, so be it. I have two kids I don’t want growing up in a debt wracked shite hole. I’ll tighten MY belt a bit.
OK, porggs, over to you – what “shared sacrifice” will you engage in?
“porggs” from the old Witheld “porgressive”. Man, I wish Witheld was still around.
Sdferr, that was resolved when Nixon got slapped down over impoundments. The President cannot spend money (or refuse to spend money) other than as Congress directs. Congress has gotten out of the habit of writing laws that specifically, so the President has a lot of functional authority, but the House needs to re-learn it PDQ.
Don’t they understand that lots of households are in the same boat? My goodness, they don’t have to spell it out for us, we understand that you can’t pay all the bills when you don’t have the money. We are the ones who have to call the oil company* and the electric company and the credit card company and try to make a deal.
Except that a lot of people don’t have 60 per cent of their money left. They have lost their whole paycheck.
Talk about tone-deaf! Cry us a river. We WISH we had the problem of too much spending that could be cut to make ends meet.
*my oil company, Arlex Oil in Lexington, MA, is a shining light of decency–when we were really broke, accounts receivable manager John Fields accepted whatever payments I could make, trusted me to pay the balance when I could, put us on their budget program (which evens out the payments so they don’t spike so high in the winter), and actually said to me when I was rattled once, “don’t worry about it, we’ll get through this together.”
Sarah, I had the exact same reaction. How many two-income families are new one- (or zero-) income families? How many of them have exhausted their credit? How many of them have had to cancel their cable, skip vacations and dining out, make do with hand-me-downs for the kids? Does Carney have any idea how tone-deaf his whining is?
Similarly, I’m working with a lot of municipalities that have exhausted their reserves and have insufficient revenues. It infuriates me that so many Council members can’t figure out that they’re out of money, and can’t make an adult decision about which services to cut. It’s as though these people think that Other People’s Money is some limitless fountain for them to play with forever.
Pitchforks are too good for ’em.
I feel bad for Squid.
Don’t cry for me, Aged Tina. The truth is that I bought an SUV a couple of weeks ago that should be able to hold about 40 cases of cheap yellow beer at a time. Figure a $10 markup (I don’t believe in gouging friends and family too badly), and I’m making $400 every time I cross the river.
Still, feel free to buy lots of pitchforks.