The president of USA, Joe Biden, described this Sunday as “unacceptable” the proposals of the Republicans to raise the limit of indebtedness of the country, and mentioned the possibility of appealing to the Constitution to avoid a default.
Negotiations to remove USA of this crisis when the date of June 1 approaches and the country could run out of resources to honor its commitments, are stuck between the government and the opposition leaders in Congress, who are demanding a sharp cut in spending from the Executive in exchange for increasing the called “ceiling” of the debt that allows issuing more credit.
“The time has come for the other (Republican) side to abandon their extreme positions, because much of what they have proposed is simply unacceptable.”, Biden declared to the press during the G7 summit in Japan. He then declared, “I’m considering the 14th Amendment.”
Debt ceiling: what are the consequences of appealing to the Constitution
The 14th Amendment, added in 1868 to the Constitution, stipulates that “the validity of the public debt of the United States, authorized by law, (…) is not to be questioned.” In other words, the expenses already voted must be able to be paid.
According to some experts, this provision makes the debt limit unconstitutional. If the Treasury borrows above the debt limit set by Congress, that would violate the law, said Neil Buchanan, a law professor at the University of Florida.
But failing to meet spending obligations set by Congress could be a worse violation, giving the Treasury justification to borrow more money and keep paying its bills. Invoking the 14th Amendment could lead to litigation, but failing to do so also carries risks.
“If the Treasury runs out of room to meet its obligations and ends up delaying certain payments, creditors have a ‘perfectly valid legal claim,'” Buchanan said.
Social Security recipients who don’t receive their checks could join a class action lawsuit, he added. On the other hand, if the Biden administration continues to borrow money, Republicans could sue it for defaulting on the debt ceiling.
That would put them “in a very uncomfortable position, because they would be suing to force the president to default on the national debt,” said Robert Hockett, a Cornell University law professor.
“We can reach an agreement,” Biden reiterated during his return flight to Washington from Japan aboard Air Force One this Sunday. But “I can’t guarantee they wouldn’t force a default”, added about his adversaries, to justify his consideration of the 14th amendment.
“I think we have the power” to use the resource, but “the question is whether it can be done and invoked on time,” said the president, who cut short his Asian tour before leaving Washington due to this crisis.
DebtA: what the Republicans are demanding
Biden was scheduled to hold a telephone conversation on Sunday with the leader of the Republicans in the House of Representatives, Kevin McCarthy, who is spearheading the opposition’s refusal to increase the country’s debt issuance capacity unless there is a commitment to reduce the spent.
Biden and McCarthy held two meetings in recent days as a deadline looms that the Treasury Department says could put the United States between a rock and a hard place.
The Republicans claim to lower public spending and the fiscal deficit, and they want to reduce the issuance of debt that usually makes it possible to cover that gap.
Democrats and Republicans do not agree on this increase in the debt issuance capacity of the United States, despite the fact that it is essential for the country to honor its payments to creditors, suppliers, pay salaries of public officials and pensions.
Raising the debt issuance limit is usually a routine procedure in the country, which has used this system dependent on Congress for decades. But this time, as has been the case more frequently, the issue is the subject of a political wrestling match.
The United States exceeded the maximum issuance limit of public debt in January, of 31.4 trillion dollars, and since then extraordinary measures have been applied that only allow it to meet obligations for a while
White House press secretary Karine Jean-Pierre said in a statement that McCarthy is being coerced by supporters of former President Donald Trump, who is “threatening to place (the United States) in default for the first time” in the history.
McCarthy tweeted Saturday that it is the White House “backing down.” “Unfortunately, the socialist branch of the Republican Party seems to be in control, especially with President Biden out of the country,” he said.
Source: Ambito
