What the President Should Say If Congress Misses the Debt Ceiling Deadline
Posted by Peter M. Shane on July 28, 2011
My Fellow Americans:
Today, for the first time in American history, the Congress of the United States has effectively prohibited the government from paying its bills. In the last 50 years, the debt ceiling has been raised 74 times, ten of those times since 2001. Those votes have been bipartisan. They have occurred under both Democratic and Republican presidents. They have been all but universally regarded as essential to preserving the full faith and credit of the United States. Yet a minority faction of today’s congressional representatives — in the face of proposed deficit-cutting plans with overwhelming support from the American people — has taken the unprecedented step of allowing us to slide into potential default.
As a result of this inaction — this betrayal of the trust of the American people — we must face a hard truth. If the government continues to spend the funds Congress has already appropriated at the rate Congress anticipated when it appropriated those funds, we will simply run out of money before the end of the fiscal year. We will face an across-the-board government shutdown, with no end in sight. We cannot let this happen.
Because this situation is unprecedented, there is simply no clear law to guide my actions in response to this crisis. Read literally, the Congressional Budget and Impoundment Control Act of 1974 allows me to defer spending that Congress has already authorized on the basis of what that statute calls “contingencies.” It has been argued that I may use that authority to choose selectively, designating obligations to meet now and obligations to defer in order to avoid a shutdown of government services. At the same time, I am also aware of arguments that the Act does not give me such authority — that a statute intended to control impoundments cannot faithfully be interpreted to allow a president to postpone so much spending at his sole discretion. If these critics are right — if the Impoundment Act does not give me such authority — then my decisions not to spend money on particular programs would violate the many statutory provisions under which Congress mandated that those funds be spent.
It has also been argued that Section Four of the Fourteenth Amendment allows me to ignore the statutory limit on incurring government debt. That section provides, “The validity of the public debt of the United States, authorized by law . . . shall not be questioned.” Some legal scholars argue that this provision authorizes the president to continue borrowing whatever funds are necessary both to meet our obligations to creditors and to continue funding government programs at the levels Congress has already approved. I have already expressed my doubts about the validity of this interpretation. I have been inclined to agree with those who read Section 4 as obligating Congress to provide for the repayment of debt, not to permit the president to ignore statutory limits on borrowing.
The fact is, however, that I am now faced with a no-win choice. I could cease government borrowing and defer some government spending, on a selective basis, under the uncertain authority of the Impoundment Control Act. But that would risk violating the many statutory provisions under which Congress has provided for government spending. I would risk disabling key government programs from operating effectively. Alternatively, if I continue government borrowing under the uncertain authority of the Fourteenth Amendment, then I will certainly be violating the statutory limit on federal debt and I will perhaps be misinterpreting our most fundamental law.
Let me clear about this conundrum. The Constitution obligates the president to “take care that the laws be faithfully executed.” I cannot duck that obligation. Yet, if I rely on one statute to withhold some government spending in order to advance what I regard as our critical priorities, then I risk violating some of the statutes through which Congress has directed the executive branch to spend money. The government spends only money that Congress appropriates; spending as Congress directs is, in most cases, a legal obligation. On the other hand, if I continue borrowing to fulfill these congressional mandates and to repay government debts that were lawfully incurred, then I am violating the debt ceiling and risk misinterpreting the scope of the Fourteenth Amendment. The legal path is not clearly marked either way.
Faced with this choice, I am compelled by both conscience and necessity to take the latter option. Deferring government spending under the Impoundment Control Act would require me to claim unprecedented discretion to pick and choose among programs that Congress has already determined to move forward. It would also leave the full faith and credit of the United States at risk, and impose numerous and unforeseen hardships on Americans who depend on the smooth and efficient operation of government programs already in place. If, however, I breach the statutory limit on borrowing, my assertion of power under the Fourteenth Amendment has a clear limit. I can borrow no more than required in order to repay those debts that have been already been incurred pursuant to law without curtailing those government programs for which Congress has appropriated funds. This is not a blank check. It is fulfilling a set of mandates that Congress itself has imposed.
I have thus decided to continue borrowing funds on behalf of the United States in order to repay those debts that have been already been incurred pursuant to law and to continue those government programs Congress has already authorized. In so doing, I believe I am faithfully executing both Congress’s current appropriations statutes and the intent of the framers of the Fourteenth Amendment to insure that the federal government would never repudiate its lawfully incurred obligations.
I would welcome congressional action to ratify this decision by statute. I would welcome even more the kind of balanced approach to debt reduction, deficit-cutting, and revenue enhancement that I have been urging on Congress for months and that can finally put our fiscal house in order for the next decade and beyond. Until Congress can reach some such agreement, however, I owe it to Congress and to the American people to stave off irreparable economic harm and to keep in effective operation the functions of our federal government for which Congress has already provided and on which the American people rely.
Thank you, and may God bless you and the United States of America.
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