According to Playbook The White House is explicitly telling Republicans in Congress that they have leverage when it comes to the debt ceiling.

Tweet

  • InternetLefty [he/him]
    ·
    2 years ago

    What is the difference between minting a trillion dollar coin and raising the debt ceiling exactly? If raising it means the state doesn't default on foreign loans does that mean they just borrow more so that they can make payments?

    • InevitableSwing [none/use name]
      ·
      2 years ago

      As I understand it - minting the coin is a painless way to solve this moronic problem because it removes congress from the equation.

      The guy behind "Mint the Coin" to end the debt ceiling: The trillion-dollar scheme, explained by its inventor - Vox

      Oct 7, 2021

      The (sorta) short answer is that later this month, the US will exceed the legal limit on how much outstanding debt the federal government can hold — the debt ceiling. Senate Republicans have agreed to allow an extension through December, but that just sets up another confrontation in a few months. To avert the global economic catastrophe that might ensue if the US exceeds the debt limit, some observers have broached some truly absurd ideas.

      Enter #MintTheCoin.

      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 during the 2011 and 2013 debt ceiling battles, they realized that this power could offer a way to sidestep the legal cap Congress places on the federal government’s borrowing.

      Instead of issuing new debt and running afoul of the debt ceiling, the Treasury secretary could simply fund the government by minting platinum coins. In 2013, even former US Mint Director Philip Diehl agreed it would work, and over the years, influential voices like financial journalist Joe Weisenthal and New York Times columnist Paul Krugman have also promoted the idea.

      • betelgeuse [comrade/them]
        ·
        2 years ago

        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.

        This is such a great country.

          • familiar [he/him]
            ·
            2 years ago

            I mean functionally it's just the MMT that a lot of us are familiar with isn't it?

            National debt isn't real cause the government can just create as much money as it needs to pay it off. There are implications to this, but they generally don't involve a total collapse or anything, especially from a superpower.

            The coin itself is just a loophole that makes it easy to run around Congress and have them fuck off, loopholes violate "decorum" of course, so it's not gonna happen but oh well

      • InternetLefty [he/him]
        ·
        2 years ago

        So it just keeps the state from taking on MORE debt if the debt ceiling is reached before expanding it. And the trillion dollar coin would just tilt the balance sheets away from the debt limit because the Treasury would suddenly have +1 trillion dollars. Would this devalue the dollar internationally? If so they should do it