The clause states that "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." Some experts suggest that this could mean a default - and thus the debt ceiling - would be unconstitutional. The Times reported on Tuesday that, according to people familiar with the discussions, officials in the White House, Treasury, and Justice Departments have floated invoking a clause in the 14th Amendment that could take care of the debt ceiling without lawmakers' approval.
"It's up to them what to do."Įven if the coin isn't on the table, there could be yet another way to avoid a default while avoiding congressional drama. "The Fed is not required to accept it, there's no requirement on the part of the Fed," she added. Yellen, for example, dismissed the idea back in January, saying that it "is not by any means to be taken as a given that the Fed would do it, and I think especially with something that's a gimmick." To be sure, Biden's administration has not been so accepting of using a $1 trillion platinum coin to avoid an economically catastrophic default. The coin's the only one that's strong enough," Rohan Grey, an assistant professor at Willamette University College of Law, told Insider. But they keep not actually being strong enough.
"At this point, if any of the other solutions, the so-called more serious solutions would work, then they would've been used by now. That's led to a school of thought that says Yellen should simply mint a trillion-dollar platinum coin and deposit it to pay off the debts until a more permanent solution can be found.
The Treasury Department can mint platinum coins of any denomination. The coin - which wouldn't need to be bigger than an average coin, and can be made quickly - is part of a potential debt-ceiling loophole. Account icon An icon in the shape of a person's head and shoulders.
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