Ross: A big, trillion dollar platinum coin can solve the debt crisis
Jan 23, 2023, 8:16 AM | Updated: 9:41 am
A sign at a bus shelter shows the national debt in Washington, DC on January 20, 2023. - The US Treasury said it began taking measures Thursday to prevent a default on government debt as theÊcountry hit its borrowing limit. (Photo by Mandel NGAN / AFP) (Photo by MANDEL NGAN/AFP via Getty Images)
(Photo by MANDEL NGAN/AFP via Getty Images)
It was 2011, Obama was President, and Republicans were playing the debt ceiling game, and somebody came up with this brilliant idea: The U.S. Mint would simply strike a platinum coin with a face value of $1 trillion, deposit it in the Treasury – and just like that, we’re back below the debt limit.
It didn’t happen, of course, because it’s a big joke, right?
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Well, I thought so too – until I looked it up in the U.S. Code, Section 31, subsection 5112, paragraph (k), and I quote: “The Secretary may mint and issue platinum … coins … in accordance with such specifications, designs, varieties, quantities, denominations, and inscriptions as the Secretary… may prescribe from time to time.”
Yes – for some reason, the law has this special provision that allows the treasury secretary to order up coins of any design and any denomination, provided they’re platinum.
A trillion-dollar coin obviously has no practical use – my barista won’t even take a fifty –, but it would instantly put the debt below the current limit and end the debt crisis, which is why it’s being talked about yet again!
Dave, that’s a stupid solution. Yes, but it’s no stupider than the crisis itself, and stupid ideas deserve stupid solutions.
For those of you asking how we got here – it’s no mystery. A combination of spending and tax cuts. The New York Times tallied up the things we paid for with borrowed money – the military buildup after the 9/11 attacks, the wars in Iraq and Afghanistan – the bi-partisan Medicare prescription drug benefit, Trump’s COVID-19 aid, Biden’s stimulus program – none of it paid for by raising taxes.
On the contrary, there were tax cuts signed by Bush and continued by Obama, and then in 2018, Trump’s tax cuts were passed by some of the same members who now say the debt is too high.
What were they thinking? Well, there’s this idea mainly among conservatives that cutting taxes actually increases revenues, which I first remember hearing during the Reagan years, and you know what? That idea turned out to be – what’s the term – wrong!
Because we cut all those taxes and have $31.5 trillion in debt.
Plus, Republicans plan to cut the new funding for the IRS so that people with complicated taxes can cheat, and law-abiding taxpayers trying to call the IRS will just hear the phones ring and ring because there’s no one to pick them up.
So, I say, given how members of Congress have no problem cutting taxes even as they boost spending – and then act surprised when suddenly we are $31.5 trillion in debt –they can hardly cry foul when Janet Yellen pulls a trillion-dollar coin out of her purse and spoils all their fun.
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