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Opinion | You Can Let Republicans Destroy the Economy, or You Can Call Their Bluff [1]
['Jamelle Bouie']
Date: 2023-01-20
With the end of hostilities and the dissolution of the rebel army, the United States federal government repudiated Confederate debt, making it worthless to the creditors of the rebellion. But as former Confederates re-entered public life, there was real fear among Republican lawmakers that a future majority of Southern Democrats and their allies might invalidate Union war debt in retaliation. To prevent this and secure the nation’s public debt for the future, Republicans added the clause to their draft of the 14th Amendment.
As Senator Benjamin Wade, Republican of Ohio, said after introducing his version of the public debt clause on the Senate floor, “I have no doubt that every man who has property in the public funds will feel safer when he sees that the national debt is withdrawn from the power of a Congress to repudiate it and placed under the guardianship of the Constitution than he would feel if it were left at loose ends and subject to the varying majorities which may arise in Congress.”
The meaning of Section 4 is somewhat unsettled, because there is enough ambiguity in the language to leave it open to several interpretations. Still, many legal scholars have taken an expansive view of the clause, drawing on Chief Justice Charles Evans Hughes’s opinion in Perry v. United States, one of the Depression-era gold clause cases, in which the court affirmed Congress’s attempt to regulate the monetary system through restrictions on gold ownership.
Hughes wrote that the public debt clause was “confirmatory of a fundamental principle, which applies as well to the government bonds in questions, and to others duly authorized by the Congress, as to those issued before the Amendment was adopted.” Nor, he said, could the court “perceive any reason for not considering the expression ‘the validity of the public debt’ as embracing whatever concerns the integrity of the public obligations.”
Under this formulation, Buchanan and Dorf note, “the validity of the debt of the United States is brought into question whenever the government acts, or threatens to act, in a way that suggests that it will not honor all of its obligations.”
Writing in 2013 for The Duke Law Journal, Jacob D. Charles makes an extended case for this view of the public debt clause, arguing from legislative history and the language of the section itself that it was meant, and is meant, to “encompass the public debt of the United States generally” and applies to circumstances beyond repudiation or default. In Charles’s view, echoing Buchanan and Dorf, the public debt clause covers any action that creates “substantial doubt” about the validity of U.S. debt and the government’s ability to meet its financial obligations.
When Congress takes action that requires the Treasury to borrow additional funds beyond statutory limits, it puts the president in a vise. If forced to act unilaterally, he can only resolve the conflict between the two sets of instructions — the spending bill and the debt limit — by taking one of two unconstitutional actions: raising taxes or cutting spending, neither of which he can do without congressional authorization. More to the point, when Congress puts the president in this situation, it places “substantial doubt on the validity of the public debt” by threatening nonpayment, or default. This, in fact, is what happened in 2011, when Standard & Poor’s removed the United States from its list of risk-free borrowers on account of Republican intransigence over whether to pay the nation’s bills.
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[1] Url:
https://www.nytimes.com/2023/01/20/opinion/debt-limit-congress-biden-mccarthy.html
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