Democrats and Republicans agree: Minting a  trillion coin isn’t a serious idea

Democrats and Republicans agree: Minting a $1 trillion coin isn’t a serious idea

Democrats and Republicans agree: Minting a  trillion coin isn’t a serious idea

One thing Democrats and Republicans agree on is that minting a $1 trillion platinum coin to avert a catastrophic debt default is not an idea to take seriously.

Instead, lawmakers are saying the federal borrowing limit should be raised the way it has been for decades: with legislation passed by Congress and signed by the President.

“I haven’t heard a plausible reason for this,” Sen. Elizabeth Warren (D-Mass.) told HuffPost when asked about the concept. β€œThe debt ceiling crisis is fabricated by Republicans. They are not serious about the national debt. If they were, they wouldn’t have voted for an increase three times when Donald Trump was President.”

The idea that has been around during the past decade of GOP debt breaching is for the Treasury to hand over a single platinum $1 trillion coin to the Federal Reserve. The Fed would then credit the Treasury Department with $1 trillion to pay down debt and avert an unprecedented default that experts say would rock financial markets and hurt the economy.

“I don’t think it takes a coin toss to solve a problem as significant as this. This is our country we’re talking about,” Senator Mitt Romney (R-Utah) told HuffPost about the coinage idea, adding that President Joe Biden and House Republicans should sit down and work out a deal to end the coinage Coin to raise debt limit that included cuts in discretionary spending.

Sen. Thom Tillis (RN.C.) said such a scheme would have “impacts” and similarly urged the White House to negotiate spending cuts instead.

“It’s not a wand. If we do, we’ll probably regret it,” he added.

Lawmakers aren’t the only ones dismissing mint-the-coin talk. Treasury Secretary Janet Yellen told the Wall Street Journal over the weekend that the Federal Reserve was unlikely to accept a $1 trillion platinum coin if the Biden administration even attempted to mint one.

The Treasury Department last week began taking so-called “extraordinary measures” – which are becoming less and less extraordinary – to continue paying the federal government’s bills after the US hit its $31.4 trillion debt ceiling. Yellen said the US can pay its bills until at least June, giving Congress about five months to raise the limit.

Republicans are demanding drastic across-the-board spending cuts and major changes to trust programs like Social Security and Medicare in exchange for raising the debt limit. It’s a tactic they’ve used several times in recent history, albeit under a Democratic president. In 2017, when they controlled the presidency and both houses of Congress, Republicans ramped up spending and raised the debt ceiling with little fanfare.

Democrats have vowed to oppose draconian spending cuts and changes that threaten Social Security and Medicare benefits. Under current funding, Medicare can pay full benefits through 2028 and Social Security through 2035. Last year, House Conservatives proposed raising the retirement age for both Medicare and Social Security and cutting monthly payments for higher earners.

The White House has indicated that Biden will meet with GOP House Speaker Kevin McCarthy (California) in the coming weeks to discuss moving forward on the debt limit and other legislative matters. For now, at least, Democrats are claiming there can be no debt limit negotiations with a House GOP caucus that has taken a sharp right turn, with members of the conservative Freedom Caucus being given far more power than in years past.

“Are these people crazier than the crazies of the past? Yes, they are,” said Senator Brian Schatz (D-Hawaii). “But I think what’s clear is that the only thing more dangerous than not dealing with these clowns is to deal with them. They are crazy and cooler heads have to prevail in the house.”

Leave a Reply

Your email address will not be published. Required fields are marked *