Can Biden use the 14th Amendment to thwart a debt ceiling default without tanking the economy?

“The 360” shows you diverse perspectives on the day’s top stories and debates.

What’s happening

With Republicans refusing to raise the debt ceiling unless Democrats agree to substantial cuts in government spending, some members of President Biden’s party are urging him to pursue an untested legal theory that they believe would allow him to stave off default without having to consent to any of the GOP’s demands.

The debt ceiling is a dollar figure set by Congress that represents the maximum amount the U.S. Treasury is allowed to borrow. It doesn’t itself increase the deficit, but simply creates room for the government to keep its financial commitments. For most of the past century, the debt ceiling was routinely raised on a bipartisan basis. But starting in the Obama era, Republicans in Congress began using the dangers of failing to raise the ceiling — which experts believe would trigger an economic catastrophe — as leverage to coax Democrats into signing on to spending cuts that they would oppose in any other circumstances.

Treasury Secretary Janet Yellen has called June 1 a “hard deadline” to raise the debt ceiling without default, leaving the Biden administration and House Speaker Kevin McCarthy a matter of days to reach a deal that can pass through a divided Congress.

But some Democrats say the Constitution includes a ready-made off-ramp that could not only resolve the current impasse, but also put an end to all gamesmanship over the debt ceiling for good. The theory centers around a clause in the 14th Amendment that states “the validity of the public debt of the United States … shall not be questioned.” Some legal scholars argue that this language allows Biden to order the Treasury to effectively ignore the debt ceiling because failing to do so would violate his constitutional duty to maintain the validity of U.S. debt.

There are alternative proposals that could also theoretically help defuse the debt ceiling crisis, including minting a trillion-dollar platinum coin and having the Treasury issue a special type of bond to fund the government in the short term. Each of those strategies is equally unprecedented and carries its own potential pitfalls.

Why there’s debate

As appealing as the 14th Amendment option may sound to Democrats, the theory has never been tested in court and legal experts disagree on whether the Supreme Court would reject an effort to use it.

But even amid that uncertainty, some on the left feel the 14th Amendment provides the best of a number of bad options for escaping a potentially disastrous debt ceiling standoff. They argue that declaring the debt ceiling unconstitutional, while an imperfect solution, is still far better than rewarding Republicans by letting them gut government programs that millions of people rely on — or standing idly by while they drive the economy off a cliff. Some constitutional scholars say there’s a strong chance the argument would survive any potential legal challenges, in part because they believe there won’t be five justices on the Supreme Court who would be willing to set off a massive recession by blocking it.

Skeptics from both sides of the aisle counter that as inconvenient as it may be for the president, the only way to avoid default is through legislation passed by Congress. They make the case that the Supreme Court would have no choice but to reject any effort to invoke the 14th Amendment because it would represent a major breach of Congress’s power over government spending. Others say the move would be on such shaky legal ground that markets would likely collapse even before the matter made its way to the courts — meaning Biden would have effectively sparked the very economic downturn he was hoping to avoid.

What’s next

Biden said on Sunday that he believes “we have the authority” to use the 14th Amendment as a way to solve the debt crisis stalemate, but all indications suggest he would consider doing so only as a last resort in the event that no deal can be reached in Congress in time to avoid default.

Perspectives

SUPPORTERS

The debt ceiling is clearly unconstitutional

“First, default on the debt (which would occur if Congress does not raise the ‘debt ceiling’ provided by statute) is flatly forbidden by the Constitution. Second, a President must sometimes contemplate defying the other branches to save the country from disaster.” — Garrett Epps, Washington Monthly

The risks are worth it if the debt ceiling is destroyed for good

“The 14th Amendment solution is a fraught one: It might wreak short-term havoc on markets and the Supreme Court might strike it down. But it might be worth trying, because in the near term there may be no other way to functionally eliminate the debt ceiling as a weapon of political extortion once and for all.” — Greg Sargent and Paul Waldman, Washington Post

It would force the GOP to actively try to crash the economy

“Biden is correct that invoking the Fourteenth Amendment’s passing mention of the public debt leaves open the door to further litigation. But the move would deprive Republicans of the political safe harbor that comes with pretending to be negotiating. If Republicans or their allies in the Supreme Court super-legislature want to take the steps necessary to reimpose the threat of default, they’d have to step forward and do it on their own. It would no longer be on Biden or the Democrats.” — Jason Linkins, New Republic

The 14th Amendment is the best of a number of bad options

“Once we hit the debt ceiling, Biden will bump into a constitutional obstacle no matter what he does. Failing to spend appropriated funds, raising taxes or borrowing money to pay the bills would all infringe on Congress’ constitutional powers. The president would face what we have called a ‘trilemma’ in which all his options are unconstitutional.” — Neil H. Buchanan and Michael C. Dorf, Los Angeles Times

Any approach that protects critical government programs is worth pursuing

“Whichever course of action Biden chooses, we should be clear that he has other options than agreeing to crack the whip against America’s poor.” — Matt Bruenig, People’s Policy Project

The hope should be that we never have to test the 14th Amendment strategy

“Still, given all the uncertainty about whether the courts will even buy the 14th Amendment argument against the debt ceiling, we should all hope that the looming questions about what happens if the debt ceiling is breached are never answered.” — Ian Millhiser, Vox

SKEPTICS

Invoking the 14th Amendment would set off its own financial crisis

“In effect, the 14th Amendment option is merely a default with more handwringing and deflecting blame on the evil Republicans who only wanted to tack an extra $14 trillion onto the national debt instead of another $19 trillion. The blame will rest solely on the Democrats who decided the most minor of haircuts was not worth avoiding a stagflationary crisis that would put the Nixon-Burns fiasco to shame.” — Tiana Lowe Doescher, Washington Examiner

Nothing in the 14th Amendment gives the president freedom to ignore the law

“The Constitution puts Congress squarely in charge of both borrowing and spending. The validity of the public debts clause doesn’t magically allow the president to violate this most basic element of the separation of powers.” — Noah Feldman, Bloomberg

Biden needs to strike a deal, not try to break the Constitution

“The Biden administration could save itself the trouble of trying to twist the Constitution to suit its narrow political purposes if it simply sat down with Congress and negotiated in good faith.” — Rich Lowry, Boston Herald

A deal with Congress is still the only way out

“The founders established a system of government that requires negotiation and compromise — the hard work associated with representing a nation of widely divergent interests. Instead of looking for loopholes and murky legal theories, President Biden and Congress need to roll up their sleeves and get to work, and quickly.” — Editorial, Deseret News

Congress alone has the authority to decide how the government spends its money

“The Constitution is quite explicit: Congress, and only Congress, has the power ‘to borrow Money on the credit of the United States.’ Congress, and only Congress, has the power to raise revenue, and all bills to do so must start in the House. The Framers were quite open in designing this system to give Congress the power of the purse so that it could bring the executive to heel.” — Editorial, National Review

It would be incredibly dangerous to leave the fate of the economy up to the whims of the Supreme Court

“We just watched this Supreme Court wipe out decades of precedent to overrule Roe. It has repeatedly entertained cases that even conservative legal scholars thought farcical just a few years earlier. … The Supreme Court does what it wants to do. Does it want to let the Biden administration dissolve the debt ceiling using a novel legal theory?” — Ezra Klein, New York Times

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