The Validity of the US Public Debt

Invoking the Fourteenth Amendment to raise the Debt Ceiling.

"The validity of the US public debt shall not be questioned “

Six months ago President Obama also faced a hostage situation. Republicans threatened to block an extension of middle-class tax cuts unless Mr. Obama gave in and extended tax cuts for the rich too. And the president essentially folded, giving the G.O.P. everything it wanted.

Now, predictably, the hostage-takers are back: blackmail worked well last December, so why not try it again? This time House Republicans say they will refuse to raise the debt ceiling — a step that could inflict major economic damage — unless Mr. Obama agrees to large spending cuts, even as they rule out any tax increase whatsoever. And the question becomes what, if anything, will get the president to say no.

The debt ceiling itself is a strange feature of U.S. law: since Congress must vote to authorize spending and choose tax rates, why have a second vote on whether to allow the borrowing that these spending and taxation policies imply? In practice, however, legislators have historically been willing to raise the debt ceiling as necessary, so this quirk in our system hasn’t mattered very much — until now.

What has changed? The answer is the radicalization of the Republican Party. (Emergence of the Tea Party)

The USAA Bank has stepped in guaranteeing, it would provide the interest-free advances to military members on active duty who already have their military pay directly deposited in a USAA account. The one-time loan would be for eligible members’ Aug. 15 paycheck. It was a program the company created in direct response to concerns about the government’s ability to pay its bills.

The President’s job Republican or Democratic is to lead our nation.

The provision in the 14^th amendment , Section 4 of the amendment, was meant to ensure the payment of Union debts after the Civil War and to disavow Confederate ones. But it was written in broader terms.

“The validity of the public debt of the United States, authorized by law, including debts incurred for payments of pensions and bounties for services in suppressing insurrection or rebellion,” the critical sentence says, “shall not be questioned.”

The Supreme Court has said in passing that those words have outlived the historical moment that gave rise to them.

“While this provision was undoubtedly inspired by the desire to put beyond question the obligations of the government issued during the Civil War,” Chief Justice Charles Evans Hughes wrote for the court in 1935, “its language indicates a broader connotation.”

In recent weeks, law professors have been trying to puzzle out the meaning and relevance of the provision. Some have joined Mr. Clinton in saying it allows Mr. Obama to ignore the debt ceiling. Others say it applies only to Congress and only to outright default on existing debts. Still others say the president may do what he wants in an emergency, with or without the authority of the 14th Amendment.

The words of the provision are in important ways quite vague. “Nobody would argue,” said Sanford Levinson, a law professor at the University of Texas, “that Section 4 is clear in its meaning, other than at the time everyone thought that the South, if they ever got back in control, would not pay Civil War debt.”

But Jack M. Balkin, a law professor at Yale, said it was possible to infer a broader principle.

“You’re not supposed to hold the validity of the public debt hostage to achieve political ends,” Mr. Balkin said. He added, though, that “Section 4 is a fail-safe that only comes into operation when everything else is exhausted.”

Mr. Obama’s statement largely dismissing the possibility of invoking the provision may have had a strategic element to it. A deficit reduction deal would seem to be more likely, after all, if both sides thought there was no alternative but economic chaos.

“This is not a circumstance,” said Laurence H. Tribe, a law professor at Harvard, “in which the courts have any plausible point of entry.” Professor Balkin agreed. “This is largely a political question,” he said. “It is unlikely courts would decide these questions.”

The debt ceiling has been raised ten times in the last ten years why is this President being treated differently ? Is the question.

Sources … NY Times, NPR.

NEWS NET

NY NEW YORK

10013

MEDIAVIEWS@GMAIL.COM