January 14, 2013

Senate Democrats’ Letter Urging Obama to Unilaterally Raise Debt Limit Gets Little or No Visibility at AP’s National Site

The self-described “essential global news network” known as the Associated Press, more aptly characterized as the Administration’s Press, has from all appearances chosen to minimize the exposure given to Friday’s letter from four Senate Democrats to President Obama encouraging him to unilaterally increase the nation’s debt ceiling if Congress fails to do so.

A search on Harry Reid’s last name at the AP’s national site at 8:30 ET this morning returned nothing relating to that letter. But there was an AP writeup about it on Sunday morning. A search on a few key words in Andrew Taylor’s report found at another web site demonstrates that it’s no longer available at the AP’s national site. Gosh, it’s almost as if AP doesn’t want Americans to know that four Democratic senators are urging Obama to blatantly violate the Constitution. The first six paragraphs of Taylor’s report follow the jump (bolds are mine throughout this post):

Top Dems urge Obama to weigh unilateral debt hike

President Barack Obama’s top Democratic allies in the Senate advised him Friday to consider “any lawful steps” to make sure the government does not default of its debts and spur an economic crisis — even if it means acting without approval by Congress.

Majority Leader Harry Reid, D-Nev., is among those urging Obama to consider options like invoking the 14th Amendment to the Constitution to find ways around the $16.4 trillion legal cap on government borrowing. The amendment states that the “validity of the public debt of the United States … shall not be questioned,” which some lawmakers believe permits a way out of the debt limit jam.

The government hit the debt limit last month and is juggling the books to buy additional time for Congress to act. But those moves only buy a few weeks of wiggle room, which requires Congress to act — likely by mid- to late-February — to avoid a market-quaking default on U.S. obligations.

The White House has said emphatically that it does not believe that the 14th Amendment permits Obama to ignore the debt cap on U.S. borrowing, though it considered the question during the 2011 debt crisis.

“There is no Plan B. There is no backup plan,” White House spokesman Jay Carney said Wednesday. “There is no alternative to Congress raising the debt ceiling.”

The letter from Reid and Sens. Dick Durbin, D-Ill., Chuck Schumer, D-N.Y., and Patty Murray, D-Wash., doesn’t mention the 14th Amendment, but aides to the senators said that’s what they have in mind in urging the president to consider unilateral action.

James Taranto at the Wall Street Journal nuked the frivolous 14th Amendment argument on Wednesday after House Minority Leader Nancy Pelosi separately came out in favor of it. In fact, what the 14th would do is force the government to put bondholders first. In other words, the entire threat of the government defaulting on its obligations (unless Obama unconstitutionally decides to do so) is bogus (internal link is in original):

The relevant section of the 14th Amendment is Section 4:

The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned. But neither the United States nor any State shall assume or pay any debt or obligation incurred in aid of insurrection or rebellion against the United States, or any claim for the loss or emancipation of any slave; but all such debts, obligations and claims shall be held illegal and void.

The purpose was to ensure that Union debts from the Civil War would be paid, while creditors who lent money to the Confederacy would get stiffed. But the wording of the amendment makes clear its broader applicability.

The 14th Amendment clearly does not authorize the executive branch to incur more debt without congressional approval. How could Pelosi possibly imagine it does? She seems to be construing “public debt” broadly to refer not only to payments due bondholders, but all money Congress has ordered to be spent.

That flies in the face of Flemming v. Nestor (1960), in which the U.S. Supreme Court held that Social Security was “a noncontractual benefit,” so that Congress has the authority to modify its eligibility requirements. If Social Security payments were a public debt, the 14th Amendment would prevent Congress not only from reducing them but even from questioning them.

What would happen if Congress failed to raise the debt limit is that the government would be unable both to pay off existing bondholders and to spend all the money Congress has ordered. That would create a conflict of law. The 14th Amendment would preclude resolving the conflict by stiffing bondholders.

The last bolded sentence goes a long way towards explaining why Taylor’s report was either visible only briefly or didn’t appear at all at AP’s national site. AP reports on the debt ceiling situation consistently refer to the possibility of default when there is none — unless President Obama chooses on his own to default, an inarguably constitutional action.

Cross-posted at NewsBusters.org.

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