The deal President Biden has made with House Republicans to raise the debt limit is designed to prevent a catastrophic default on the national debt. But the failure that led the United States to be unable to pay its bills within days has once again called on the Biden administration to prevent the debt ceiling from remaining a political tool.
After stating this year that he would not negotiate spending cuts in exchange for raising the debt limit, Mr Biden did just that. The deal includes spending caps and shrinks some of the president’s policy priorities in exchange for suspending the debt limit for two years.
The bill, which the House is expected to vote on Wednesday, has reopened the door to the debt limit, a perpetual point of leverage that allows the minority party — in this case, the Republicans — to use the loan limit to enforce legal concessions.
That has raised questions about whether there’s a way to rule out another episode like this — by abolishing the debt ceiling or using the 14th Amendment to make the legal cap unconstitutional.
Mr Biden opted not to challenge the constitutionality of the debt limit this time around, but last week suggested he had the authority to do so and hinted he could try to make use of it in the future.
“My hope and intention is that when we solve this problem, I would find a rationale to take it to court to see if the 14th Amendment is indeed something that could stop it,” Biden said. said at a press conference in Japan after a meeting of leaders of the Group of 7 countries.
The president said Sunday that there is no discussion imminent about whether or not to invoke the 14th amendment. “That’s another day,” he said.
Invoking the 14th Amendment has been put forward as a possible solution to avoid future battles over the debt limit because it contains a clause stating that “the validity of the national debt of the United States, authorized by law, including debt incurred for the payment of pensions and contributions for services in suppressing insurrection or rebellion, shall not be questioned.”
Some legal scholars say the clause overrides the statutory borrowing limit, which is set by Congress and can only be waived or suspended with the approval of the legislature.
The Biden administration has explored whether it could use the 14th Amendment to circumvent Congress, arguing that it would be a violation of the law if the federal government failed to pay its bills on time.
When and how Mr. Biden might attempt to pass that legal test could affect how his legislative agenda holds up in a possible second term and how future presidents navigate budget negotiations when a minority party appears willing to risk bankruptcy.
The Justice Department indicated this week that the Biden administration preferred to keep its legal thinking on the matter private.
This month, the National Association of Government Employees Union filed a lawsuit in a Boston district court challenging the constitutionality of the debt limit statute and trying to prevent the federal government from suspending certain operations if the debt limit is exceeded.
A federal judge had asked the Justice Department to respond to the lawsuit by Tuesday and explain in writing its position on whether the president should continue to borrow to pay bills under the 14th Amendment, regardless of the legal debt limit.
However, after the agreement was reached, the department’s lawyers asked for a hearing scheduled for Wednesday to be postponed.
The judge, Richard Stearns, agreed to postpone it indefinitely and allowed the Biden administration not to explain its legal rationale.
That move disappointed some progressive groups who have been pressuring the government to invoke the 14th Amendment to defuse the fight against the debt limit.
“The question of whether and how the debt ceiling can be legally enforced is relevant not only to the current mess, but also to the deal that has set up a Biden-McCarthy deal for early 2025,” said Jeff Hauser, the director of the liberal Revolving door project. “We will not end recurring hostage-taking until courts have determined that the paradoxes inherent in the debt ceiling statute and the clear implications of the 14th Amendment and the current clause of the Constitution render the debt ceiling statute unenforceable.”
On Tuesday, Representative Jason Smith, Republican of Missouri and the chairman of the House Ways and Means Committee, made it clear that his party intended to continue using the loan limit as leverage. “The debt ceiling should be the mechanism that forces the parties at the table to negotiate ways to address Washington’s spending habit,” he said.
Despite studying the merits of invoking the 14th Amendment, officials in the Biden administration have expressed concern that using it to bypass Congress would create a legal battle that could create uncertainty and hurt financial markets and the economy. would rattle, even if the federal government appears to be paying her. debts.
This month Treasury Secretary Janet L. Yellen described invoking the 14th Amendment to override the debt limit as “legally questionable.”
Last week, Wally Adeyemo, the deputy secretary of the treasury, told CNN that the Biden administration had no intention of invoking the 14th Amendment: “I think the president and the secretary are clear that that is not going to solve our problems now. ”
Shalanda Young, the White House budget director, objected Tuesday when asked if she wanted to scrap the debt limit, saying her only focus was to get the bill on Mr Biden’s desk and avoid a default.
“As the president said Sunday, Congress must act quickly to pass this bipartisan agreement to prevent our country from defaulting on its commitments for the first time, and other options are a question for another day,” said Michael Kikukawa, a White House spokesman.
Laurence H. Tribe, professor emeritus of law at Harvard University, said it was too late for Mr. Biden to seek advice from the courts, even if the administration issued a legal opinion through the Office of Legal Counsel arguing that the debt limit is not constitutional.
“I don’t think there’s a judicial solution in sight because the only time courts can get involved is when it’s a current issue,” said Mr Tribe.
Mr Tribe, who has argued that Mr Biden should tell Congress that the United States will pay all its bills when they are due, even if the Treasury Department has to borrow more than Congress has said, suggested that it is now up to the legislators to act to eliminate the contradictions between them authorizing spending and then setting a limit on how much the government can borrow to pay for that spending.
While this deadlock appears to have been resolved, future battles are looming. The deal only suspends the borrowing cap until January 2025, leaving open the possibility that Mr Biden will face the threat of default early if he wins a second term.
For that reason, the government workers’ union intends to pursue its case and allow the courts to review the merits
“The announcement this weekend of a debt ceiling deal does not resolve our concerns for our federal employee members or our federal lawsuit,” said David Holway, the union’s president. “If the deal becomes law before the June 5 deadline, Congress will only have kicked the barrel down the road, leaving us with another crisis in the near future.”
He added: “As long as the debt limit statute remains on the books as it is, this political football game will continue to threaten our members and the country.”
