The debt ceiling standoff is getting very real, very quickly. On Friday, the Congressional Budget Office warned that the federal government could run out of cash within the first two weeks of June. While the Treasury Department has been using extraordinary measures since January to keep paying US debt, officials there have said those measures could be exhausted by June 1, potentially setting up the US for a catastrophic default later this summer.
The most straightforward way to avoid disaster would be for Congress to vote for a clean debt ceiling increase, as it has repeatedly done in past years, but the Republican-led House has said it won’t raise the ceiling without deep spending cuts and a rollback of President Joe Biden’s clean energy agenda, all of which the president has said is off the table.
Negotiations are still underway, but barring a deal, the only way to avoid a default might be for Biden to use executive action to render the ceiling moot. Those options range from issuing a novel kind of debt that could be used to fund the government, to invoking the 14th Amendment to argue the debt ceiling is unconstitutional, to claiming that previously passed congressional tax and spending legislation allows the president to simply ignore the debt ceiling.
But no option would be funnier — in a way that matches the absurdity of the situation Washington finds itself in — than this one: minting a platinum coin worth $1 trillion to pay for the government expenses.
If you are not familiar with the platinum coin idea, or the hashtag #MintTheCoin, or the small army of Coinistas who have become a vocal part of economics and finance circles since the early 2010s, you may be asking: What the hell are you talking about?
The (sorta) short answer is that a 1997 law intended to help the Mint make money off of coin collectors gives the Treasury secretary the power to mint platinum coins of any denomination, for any reason. When commentators discovered this law…
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