Some Democrats want the president to raise it by himself. But the 14th amendment offers him a much better strategy.
As the country nears the fiscal cliff, it's deja vu all over again. Republicans are now asserting that they will refuse to raise the debt ceiling if they don't get their way in the negotiations. In response, some Democrats want President Obama to invoke the 14th Amendment and raise the debt ceiling unilaterally. What they don't understand is that doing so is not only legally dicey, it is also completely unnecessary for Obama to prevail. Obama's correct--and constitutional--response to Republican intransigence is the same as Bill Clinton's before him: a replay of the 1995 government shutdown. If Republicans force that confrontation, they will lose, just as they did before.
Republicans are in a pretty poor bargaining position in the fiscal cliff negotiations. They know that if President Obama simply does nothing, the Bush tax cuts will expire on January 1st and defense spending will be cut. At that point Obama can propose lowering taxes for the middle class--but not the rich--and raising defense spending as part of new grand bargain on taxes and spending. The Republicans will be hard pressed to say no. After all, if they refuse to play ball, all they will get is higher taxes and cuts to defense. That's not winning.
As a result, House Speaker John Boehner has tried to return to the same strategy he used in the summer of 2011. He wants to tie the debate over taxes and spending to an increase in the debt ceiling. It's important to understand that raising the debt ceiling does not increase spending by itself. It merely allows the Treasury to issue new government bonds to pay for monies that Congress has already appropriated by law. Essentially, refusing to raise the debt ceiling after you've already appropriated expenditures is like telling your creditors that you won't pay debts you've already contracted because you have conveniently decided to run out of money.
The government is on course to reach the current cap on the debt ceiling of approximately 16.4 trillion dollars in February or March of 2013. The Republicans' threat is the same as they made in 2011. Unless President Obama agrees to spending cuts and tax policies the Republicans like, they will refuse to raise the debt ceiling and the United States will go into default.
In response, President Obama has made two statements. First, he has made clear that he will refuse to bargain over the debt ceiling with Republicans. (After all, until 2011, the debt ceiling was raised regularly and without much controversy in both Democratic and Republican administrations.) Second, Obama's press secretary, Jay Carney, has explained that the president believes he does not have the authority to increase the debt limit and issue new bonds unilaterally.
Some Democrats are concerned: they believe that the president should threaten to raise the debt ceiling and that he has thrown away his most effective weapon in the confrontation.
They are wrong.
Section 4 of the Fourteenth Amendment provides that "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." Its purpose was to prevent Southern Congressmen and Senators from trying to hold payment of the nation's debts hostage in order to get their way on Reconstruction policies. The point of Section 4 was to put this sort of hostage-taking beyond ordinary politics. The framers of the 14th amendment did not want future politicians to threaten to destroy the country's finances by refusing to pay the country's debts in order to win political concessions from their opponents. After all, once politicians did so successfully, they would try it over and over again and it would become a normal feature of politics. That is precisely what we are seeing now.
If Congressional Republicans are threatening to let the nation to default on its debts if Obama doesn't agree to their demands, they are violating the Constitution. And the president should call them out for such an outrageous demand. But does that mean that the president can raise the debt ceiling himself to remedy the violation?
Not so fast. Article I, section 8 of the Constitution gives Congress, not the president, the authority to borrow on the credit of the United States. Even so, under section 4 of the Fourteenth Amendment the president has an independent constitutional obligation not to allow the validity of the debt of the United States to be put into question. That means, at the very least, that the president must make sure that interest payments continue on existing federal bonds and similar obligations. He must assure bondholders that they will continue to get paid even after the debt ceiling is reached.
If the president follows his constitutional obligations, then some government operations will not get funded because payments to the bondholders must come first. That means a partial government shutdown, with more and more of the government closed as the president continues to pay the bondholders.
We've seen this movie before. Once government offices close and government checks aren't issued, the public will complain loudly, the markets will tumble, and Congress will eventually have to give in, just as it did in the winter of 1995. The public will rightly conclude that Congress is to blame, because it was Congress, and not the president, who tried to hold the nation's economy hostage.
The president's obligation to pay the bondholders first-- and not the power to ignore the debt ceiling--is how the Fourteenth Amendment helps the president resolve any debt ceiling crisis. All he has to do is follow the Constitution and he will come out on top. He doesn't have to raise the debt limit at all. Instead, he must calmly explain to Republicans in advance what he will do -- and not do -- if they remain intransigent. He must explain to them that their course of action will inevitably lead to a government shutdown, and that the shutdown -- and its associated costs to the country -- will be on their heads.
In fact, if Obama did announce that he would ignore the debt ceiling -- as some Democrats would like -- he would actually take the pressure off Congressional Republicans. Then they would have an incentive to refuse to raise the debt ceiling, let Obama take the political heat for issuing new bonds, and then attack Obama's decision in the courts. They might even use his action as an excuse to try to impeach him.
To be sure, if the crisis continues long enough that the markets have completely melted down and there is not enough money even to pay the bondholders, the president might have a constitutional obligation to issue new debt to satisfy the Fourteenth Amendment. But by then the world economy would be in a complete shambles; it is far more likely that Congress would raise the debt ceiling well before that point.
The moral of the story is simple: The best way for Obama to head off Republican threats of another debt ceiling crisis is to make his position clear at the outset. First, he should explain that he won't bargain with hostage takers. Second, he should make clear that he won't let Congress off the hook by raising the debt ceiling himself. Obama has now made both of these statements publicly. Third, he should state clearly that if Congress does not raise the debt ceiling he will continue to pay all of the nation's debts as required by the Constitution. Fourth, he should make clear that he will continue to do so even if this means curtailing or shutting down government functions until Congress comes to its senses.
If Obama does all these things, he will be in the strongest possible bargaining position. And he will also be following the Constitution.
The social network learns more about its users than they might realize.
Facebook, you may have noticed, turned into a rainbow-drenched spectacle following the Supreme Court’s decision Friday that same-sex marriage is a Constitutional right.
By overlaying their profile photos with a rainbow filter, Facebook users began celebrating in a way we haven't seen since March 2013, when 3 million peoplechanged their profile images to a red equals sign—the logo of the Human Rights Campaign—as a way to support marriage equality. This time, Facebook provided a simple way to turn profile photos rainbow-colored. More than 1 million people changed their profile in the first few hours, according to the Facebook spokesperson William Nevius, and the number continues to grow.
“This is probably a Facebook experiment!” joked the MIT network scientist Cesar Hidalgo on Facebook yesterday. “This is one Facebook study I want to be included in!” wrote Stacy Blasiola, a communications Ph.D. candidate at the University of Illinois, when she changed her profile.
The second episode of the new season was a slow burner with a dramatic twist.
Let’s start at the beginning, with Frank in bed with his wife, Jordan, discussing water stains on the ceiling and childhood entombments. I don’t know about you guys, but I found this whole bit slack and familiar. Maybe there was a two-minute scene in there, but five? Maybe a more charismatic actor could have pulled off that lengthy monologue. But Vince Vaughn is no Robert Shaw, and his childhood basement is no U.S.S. Indianapolis.
The Islamic State is no mere collection of psychopaths. It is a religious group with carefully considered beliefs, among them that it is a key agent of the coming apocalypse. Here’s what that means for its strategy—and for how to stop it.
What is the Islamic State?
Where did it come from, and what are its intentions? The simplicity of these questions can be deceiving, and few Western leaders seem to know the answers. In December, The New York Times published confidential comments by Major General Michael K. Nagata, the Special Operations commander for the United States in the Middle East, admitting that he had hardly begun figuring out the Islamic State’s appeal. “We have not defeated the idea,” he said. “We do not even understand the idea.” In the past year, President Obama has referred to the Islamic State, variously, as “not Islamic” and as al-Qaeda’s “jayvee team,” statements that reflected confusion about the group, and may have contributed to significant strategic errors.
Over the last two weeks, Republican presidential candidates have repeatedly missed opportunities to demonstrate that they care about communities outside of their traditional base.
After Mitt Romney’s defeat in 2012, the Republican National Committee published an “autopsy.” “When it comes to social issues,” the autopsy declared, “the Party must in fact and deed be inclusive and welcoming. If we are not, we will limit our ability to attract young people.” The autopsy also added that, “we need to go to communities where Republicans do not normally go to listen and make our case. We need to campaign among Hispanic, black, Asian, and gay Americans and demonstrate we care about them, too.”
The last two weeks, more than any since Romney’s defeat, illustrate how miserably the GOP has failed.
Start with June 17, when Dylann Roof, a young white man enamored of the Confederate flag, murdered nine African Americans in church. Within three days, Romney had called for the Confederate flag’s removal from South Carolina’s capitol. Four days later, the state’s Republican governor and senators called for its removal too. But during that entire week—even as it became obvious that the politics of the flag were shifting—not a single GOP presidential candidate forthrightly called for it to be taken down. Instead, they mostly called it a state decision, a transparent dodge politicians deploy when they don’t want to make a difficult call.
For centuries, experts have predicted that machines would make workers obsolete. That moment may finally be arriving. Could that be a good thing?
1. Youngstown, U.S.A.
The end of work is still just a futuristic concept for most of the United States, but it is something like a moment in history for Youngstown, Ohio, one its residents can cite with precision: September 19, 1977.
For much of the 20th century, Youngstown’s steel mills delivered such great prosperity that the city was a model of the American dream, boasting a median income and a homeownership rate that were among the nation’s highest. But as manufacturing shifted abroad after World War II, Youngstown steel suffered, and on that gray September afternoon in 1977, Youngstown Sheet and Tube announced the shuttering of its Campbell Works mill. Within five years, the city lost 50,000 jobs and $1.3 billion in manufacturing wages. The effect was so severe that a term was coined to describe the fallout: regional depression.
The commonwealth is facing a serious debt crisis that could result in default, but that’s only part of the problem.
Puerto Rico is a small island with some big financial problems. Governor Alejandro Garcia Padilla recently told the New York Times that there was no way the island, which has been struggling with about $72 billion of debt, would be able to pay, and instead would try to work out new deals and deferred payments with some of its creditors. This, of course, has lead to fears that the commonwealth will default on its loans.
The admission that Puerto Rico’s finances are much worse than originally thought was spurred by areport commissioned by the Government Development Bank, an agency tasked with developing economic and financial strategies for the commonwealth, and conducted by current and former IMF staffers. The report, nicknamed The Krueger Plan for it’s lead author Anne Krueger, doesn’t mince words when it comes to the outlook for the debt-laden island: "Structural problems, economic shocks and weak public finances have yielded a decade of stagnation, outmigration and debt. Financial markets once looked past these realities but have since cut off the commonwealth from normal market access. A crisis looms.”
The historian and Knesset member Michael Oren accuses the president of distancing the U.S. from Israel, and calls out left-wing Jews and Israel’s Jewish critics in the American press.
In a recent post, I suggested that the intervention of two men, the former U.S. national security advisor Tom Donilon and the former Israeli ambassador to the United States, Michael Oren, might help improve the dysfunctional relationship between the Obama administration and the government of Israeli Prime Minister Benjamin Netanyahu.
At the time I wrote this, both men had reputations as people who were concerned about preserving the extraordinarily complicated, and extraordinarily close, U.S.-Israel relationship, and both had spent a good deal of time calming the waters between Obama and Netanyahu. Today, Donilon maintains that reputation. As for Oren …
Put it this way: If Goldblog readers would allow me to withdraw the suggestion, I’d be much obliged. Oren has created a new role for himself: acid critic of the Obama administration and of left-leaning American Jews (especially in the press and in the White House) who, he believes, are trading on their Jewishness when they criticize Israel. Oren’s critique, at its heart, is simple: Obama, in part because he wanted to reconcile the U.S. with the “Muslim world” (a very large, ill-defined, and politically complicated concept, in Oren’s mind), decided to distance the United States from Israel; to surprise Israel by altering U.S. Middle East policy without prior notice; and to negotiate with Israel’s most potent enemy without alerting Israeli leaders.
Tuesday is the official deadline for the Greek government to either make a deal with debtors or face default and its consequences.
According to the Wall Street Journal, Greece’s finance minister has said that some bank branches may reopen on Wednesday to service those who don’t have access to debt or credit cards, including many pension recipients. Withdrawals will be limited to €120 ($134). The finance minister, Yanis Varoufakis, has also said that Greece has no intention of paying the IMF by the end of Tuesday’s deadline, and that he instead hopes that a last-minute deal is reached.
Throughout season three, the Netflix show has fashioned an unmistakeable philosophical thesis: All humankind is fundamentally flawed, but kindness can save us.
(Warning: There are spoilers ahead concerning plot points through the finale of season three.)
In season one of Orange Is the New Black, when an attempt to scare a group of wayward teens straight results in their derision, Piper tells one of them that the scariest thing about prison isn’t other people—it’s the fact that it forces you to come to terms with who you really are. Season three, which was released on Netflix earlier this month, has doubled down on this thesis in unexpected ways: Piper (Taylor Schilling), for example, has evolved from a naive yuppie into a cruel and manipulative businesswoman who exploits cheap labor via her used-panty business, while Pennsatucky (Taryn Manning), a lunatic who murdered a doctor and tried to kill Piper with a shiv in season one, is now one of the show’s most sympathetic characters.
To understand the conflict’s legacy, consider what might have been.
In the spring of 2015, my undergraduate son and I drove the length of the 1914-1918 Western Front, from the British battlefields in Flanders through the French zone in Champagne and Lorraine to the American cemeteries and monuments: Chateau-Thierry, St. Quentin, Belleau Wood, the Argonne. The nearer we approached the American sector, the fewer tourists shared the sites with us. Under the Menin gate at Ypres—a massive memorial to Britain’s lost—we were jostled among half a thousand men and women, boys and girls. In the overwhelming Meuse-Argonne cemetery, the largest American military burying place in all Europe, we stood alone.
A Twitter follower offered me a memorable explanation of the weak hold of the First World War upon the American consciousness. “Americans prefer the sequel: better villains, bigger explosions.” There’s something to that. But if this earlier war has faded from national memory, its aftermath shapes American culture.