Gerry Canavan

the smartest kid on earth

Boehnerdämmerung

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With Boehner unable to pass even his own debt-ceiling bill, much less a reasonable one, Jack Belkin is talking Plan Bs. In addition to the Fourteenth Amendment option I’ve been hammering for months, there’s also something else a lot of people have suddenly started talking up, platinum-coin seigniorage:

Sovereign governments such as the United States can print new money. However, there’s a statutory limit to the amount of paper currency that can be in circulation at any one time.

Ironically, there’s no similar limit on the amount of coinage. A little-known statute gives the secretary of the Treasury the authority to issue platinum coins in any denomination. So some commentators have suggested that the Treasury create two $1 trillion coins, deposit them in its account in the Federal Reserve and write checks on the proceeds.

In the meantime: NRO’s Douglas Holtz-Eakin loses it. So does Joe Klein. Five Reasons the House GOP Is to Blame. The end of John Boehner. Boehner’s Three-Legged Stool of Doom. And from the Dep’t of Very, Very, Obvious Observations:

If in fact the debt limit is not raised well beyond the August 2 target date, and the economy suffers the severe blow that experts, Democratic politicians, and most Republican politicians believe is likely to happen — the dissenting Republican politicians such as Michele Bachmann, Steve King, and Louie Gohmert (and other insiders) will not, in fact, admit that they were wrong about it. Instead, they will blame Barack Obama for implementing the debt limit badly. And they will do so no matter how he implemented it (I’d say that would include if he did it precisely how they had advised, which would be true, except that I believe their position is mathematically impossible, so it won’t be happening).

What’s more, and this is only slightly less obvious and slightly less certain, they will almost certainly not be penalized within the GOP for being wrong. Indeed, what’s far more likely is that if, as virtually all economists and budget experts currently insist, failure to raise the debt limit causes economic disaster, the likely effect within the GOP will be to enhance the prospects of those who claim that the experts don’t know what they’re talking about — and any post-limit disaster will be considered yet another sign that the experts don’t know what they’re talking about.

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