One Step Closer to Oblivion: Obama Removes 14th Amendment Option
Reuters reports:
The White House said on Tuesday that the 14th Amendment of the U.S. Constitution was “not available” to President Barack Obama to avoid the August 2 deadline to raise the U.S. debt ceiling.
So it is either Boehner’s Teabag or financial chaos. Or… Boehner’s Teabag and financial chaos.
Giving away weapons when facing maniacs is great strategy!! I’m so glad we elected a Democrat.
http://www.youtube.com/watch?v=mWRVbWMvi7c
I’m a hopeless romantic, so I was hoping for that speech followed by invocation of the 14th option.
It ain’t happening though.
He said at the U of MD Town Hall that he was being told that the 14th Amendment thing wasn’t viable.
Yeah, but that was not categorical. Can’t he go 24 hours without crushing one of my dreams? No. He can’t. My combative, “let’s fight these bastards” dreams are like so much trash to him.
The DC phone lines aren’t the only things crashing this afternoon. Boehner lost the Club for Growth and Americans for Prosperity etc. and reportedly does not have the votes for his plan from the extreme right. NICELY PLAYED! Plus the WH/OMB just announced that Obama would veto that plan if it did make it through. Now, if the GOP won’t back the Reid plan, then Obama will use his constitutionally sanctioned right to secure the credit but only at the last minute which will still be too late to do much good. The GOP will be blamed for this and Americans will lose and people like Eric Cantor who bet we’d fail will reap their rewards.
Bill Clinton told him to play the 14Th amendment card and fight it out in the courts later he ends up saving the country and being a hero who showed some backbone. He should then follow up by stating that default will endanger our country and he will not allow anyone including the courts to do that and by doing so he would be remaining true to his Oath of Office.
Reagan = Too Liberal for the Republican Party today
Clinton = Too Liberal for the Democratic Party today
(Not that Clinton was even a Liberal when he was President, which says something anyway, whatever, I dunno.)
I think a managed default would be be better than the 14th Amendment option. A default could be managed to minimize the damage, and it has the added benefit of being within the law.
Hey, it could also be managed like “Stop all payments to Halliburton first.”
I don’t think the 14th Amendment option would prevail in the courts, and it would allow Repubs to pound on Obama as an illegitimate president, not to mention the whole government and all its spending as illegitimate.
And they would have a point. It would remind me of Yeltsin ruling Russia by decree.
I also don’t think the 14th amendment option and the resulting court battle and political turmoil would be of any more use in reassuring markets about US stability.
“(Not that Clinton was even a Liberal when he was President”
You get one hell of a lot of liberal points for raising taxes on the rich. The additional income powers the rest of the liberal agenda. Not to mention the economic justice.
And you lose the points when you pass on the opportunity, like last December.
ugh. I hate everything. I can’t even watch the coverage on this anymore.
Idiocracy. We’re there.
V, it’s too depressing to watch the Daily Show even. The terrorists (republicans) i fear, have won.
We’ve been defaulting for decades through the devaluation of the dollar via the printing press, also known as inflation of the money stock.
Why not be honest about it this time?
In truth, the debt ceiling antics are all a sideshow.
Ever wonder why wages have barely moved in thirty years, yet prices continue to go up? Printing money, necessary to keep our megalithic government going, siphons riches to the banks and mega-corporations. The banks inflate and pass the money out to corporate cronies, and us common folk get the crumbs. Furthermore, this inflationary business cycle leads to tremendous bubbles (dotcom, housing) that cause economic havoc and eliminate the savings of everyday people. This financial scheme, an elite banker’s utopia, has done more to impoverish the masses, destroy the middle class, and impede the advancement of humanity than any other force in history.
Whether you’re for big government or small government, liberal or conservative, we cannot continue as a free society without shedding the oppressive monetary system that we live under.
What’s the answer? End the Federal Reserve and repeal the legal tender laws in order to allow people freedom to choose what they use as money. That is, unless you enjoy being the pawns of billionaire bankers.
Sure, but prithee what am I supposed to do when my haberdasher will not accept two ducks and a sheaf of wheat in payment? Verily, it perplexes the mind.
Jason330- Open your mind.
Being a corporate dupe isn’t befitting for an Amishman.
You could be a sex worker.
Might as well. You’re getting screwed big time anyway, what’s the difference?
I just want to know what I’m going to use instead of money.
CBO only valued Boehner’s plan as worth $850B in deficit reduction so I think that will kill it. He says he’s rewriting it. I’m sure there are some unkicked orphans left.
Greg Sargent does some excellent reporting and comes up with some info on how folks in the Senate expect this thing to play out:
Go read the whole thing. No idea if it would work, but it certainly sounds plausible.
I think that’s exactly what’s happening Cass and the conservative establishment is fighting. A lot of groups, Club for Growth and Heritage came out against the plan. Chamber of Commerce and WSJ supports the deal. I have no idea why – another fight in January would be horrible.
Jason,
“I just want to know what I’m going to use instead of money.”
Excellent question. Please allow me to help you understand.
Whatever we end up using, were Federal Reserve notes abandoned as the nation’s currency, will be money. Money must have the following properties: medium of exchange, unit of account, and store of value. So, it must be accepted as an intermediate exchange for goods and services, be easily divisible into smaller units and equally comparable to other units, and retain its value and usefulness over time. The Federal Reserves notes we use now are particularly awful when it comes to that last property. Common forms of money in the past were based on commodity goods, such as gold, silver, copper, rice and wheat. For ease of transportation, representations of specific weights of these goods were created, often in the form of paper notes, and were able to be redeemed for the physical commodity on demand.
I don’t advocate any specific type of money for use in the future. We should allow the market to determine what forms of money become universally accepted, whether it’s a commodity money, such as gold or silver, or a pure fiat money, such as privately-issued currency (e.g. bitcoins) or government-issued notes. Even more radical options, such as land-backed and stock-backed currencies, deserve consideration, though I don’t vouch for their viability. I tend to think that in a market that allows for free and full competition in currency, free of restrictions such as legal tender laws, most people would gravitate towards a commodity based money. The reason I hold this last opinion is that it is much more difficult for bankers to commit fraud and counterfeit when using a hard commodity such as precious metals; gold cannot be replicated, whereas fiat paper money can easily be printed endlessly.
Truthfully, just legalizing competition in currency would open the gateway for the abolition of the terrible parasitic system we operate under currently. Repealing the legal tender laws would guarantee the eventual popular abandonment of Federal Reserve notes.
So, to answer your question, you probably wouldn’t end up trading ducks because they don’t readily meet the properties of money. You could use gold, silver, or another metal. You could use a currency backed by plots of land or shares in an enterprise. You could use a money created by a private organization, perhaps an indepently-controlled entity known as the Delaware Monetary Union that issues and controls a private money stock and guarantees against fraud and counterfeiting. Why not start it with all of your progressive friends to ensure that it’s run with the interests of common folks in mind, rather than the interests of huge banks and corporations? Eventually one, or many, of these moneys would become commonly accepted and fill the role that Federal Reserve notes play today. The possibilities are endless.
Also, I’d like to elaborate briefly on my earlier post. Another reason the financial system we have now is so terrible for us regular consumers is that the Federal Reserve acts as a government-sanctioned cartel. It’s the rough equivalent of creating a Federal Oil Reserve with Chevron, ExxonMobil, ConocoPhillips and BP as the trustees, appointing oil industry executives and scientists as the directors, and then allowing them to collude amongst themselves to set production and price levels. Obviously, a monopolistic regime of this type that exerts total control over and removes free competition from the oil market would be exruciating for the everyday consumer. A cartel over money is no different. In fact, it’s much worse because money makes up half of every transaction we participate in.
Sorry. That was a test and you failed. The correct answer to “What are we going to use instead of money?”
Is, “electronic ones and zeros.” I’m using them right now!
Jason, that can be money and is covered in what I wrote about above. See bitcoins (referenced above) for an example.
Do you know who else wanted the Federal Reserve notes abandoned as the nation’s currency?
Hitler.
I know I shouldn’t do this but…
Some questions:
While we let the market decide what would end up being “money” wouldn’t our system turn into one huge opportunity for discrimination and frustration for customers trying to get goods? “you’re money’s no good here” would be a real thing. If my baby’s hungry and the only grocery store nearby only accepts (I don’t know)Widgets, but my job pays me in Dubloons, and I can’t get there by bus because they only accept Bidencoins and the gas station takes Obamlets. That’s sort of assinine. Also wouldn’t the “conversion” businesses that popped up to solve these problems create all sorts of new ones by taking stuff off the top for profit?
Wasn’t this one of the big issues with the original 13 colonies? because you had to change currency every time you crossed a state line? Wasn’t that also part of the argument for the Euro? Not a big deal if i live in CA, but sort of a big deal here where I cross a state all the time.
Also if we allow competition in currency wouldn’t this be a great way to greater divide the rich and poor? they get one currency, we get another. They can keep me out of their stores. It would be like a monetary caste system.
Can’t we just use some kind of Jesus Bucks?
You know – a faith-based currency.
V,
“While we let the market decide what would end up being “money” wouldn’t our system turn into one huge opportunity for discrimination and frustration for customers trying to get goods? “you’re money’s no good here” would be a real thing. If my baby’s hungry and the only grocery store nearby only accepts (I don’t know)Widgets, but my job pays me in Dubloons, and I can’t get there by bus because they only accept Bidencoins and the gas station takes Obamlets. That’s sort of assinine.”
While it is a possibility that situations could arise where businesses and people wouldn’t accept one form of money, it would only because the money being proferred was worthless. If the once-responsible Delaware Monetary Union (referenced above) started increasing its money stock maniacally, the currency would crash and become worthless, and rightfully so. This has actually happened throughout history with bank and government issued currencies that have been inflated through the printing press. It’s less likely to happen with commodity based moneys because commodities, by definition, have value to a large group of people.
Also, to look at it from a logical standpoint, if your job pays you in Dubloons, it stands to reason that that money will be accepted commercially elsewhere as well. The only way your employer is able to pay you in Dubloons is because it accepts Dubloons in payment for goods and services. Consumers who purchases goods and services from your employer must receive the Dubloons from somewhere; most likely that’s going to be in the form of wages from their employer, who in turn accepts Dubloons for payment, and so on. It would be no secret which currencies have value, especially in the information age, so people and businesses would be prone to accept viable currencies while worthless ones would fall out of use, being rightly eliminated from market participation.
“Also wouldn’t the “conversion” businesses that popped up to solve these problems create all sorts of new ones by taking stuff off the top for profit?”
I could see this being widespread in a more uncertain environment, such as in the beginning of the replacement of Federal Reserve notes. Eventually, moneys that prove their viability and stability would become widely accepted, eliminating the need for continual conversion. This is similar to Mexican silver dollars, which became widely accepted around the world in the 19th century. A parallel today is the acceptance of Federal Reserve notes in many foreign countries, where merchants and individuals readily eschew the local currency, which many times has serious problems of its own, for more useful FRNs.
“Wasn’t this one of the big issues with the original 13 colonies? because you had to change currency every time you crossed a state line?”
While my education in this particular area isn’t as extensive as I’d like it to be, and I can’t wholly address your concerns, I will share with you what I can. One of the big concerns about colonies and individual states printing money had to do with devaluation, the same problem we face now. People and businesses won’t accept a currency that wildly fluctuates in value, which is what happened to many, though not all, colonial bill-of-credit currencies. For example, local bills of credit issued in North Carolina depreciated to one twelfth of its value, in South Carolina to one seventh of its value, and in Pennsylvania to two thirds of its value. There are pros and cons to be discussed with these fiat money systems, and they are often cited when discussing currency problems in pre-revolution America. It should also be noted that the originial US dollar was defined as a specific weight of silver, 416 grains; part of the allure here being that silver remains the same no matter where it is traded.
“Wasn’t that also part of the argument for the Euro?”
I’ll have to defer again to my lack of education on the specifics of this questions. I don’t like to speak authoritatively unless I am well versed in the subject. Regardless of conversion issues that may have been solved by the Euro, consider how it has done for the members of the EU. Greece, Portugal, and Ireland face massive debt problems and austerity, which they now have little control over because they bought into a system controlled, via the Euro, by the European Central Bank. In the meantime, the people of Germany, France, and other EU bloc countries are on the hook for Grecian fiscal-malfeasance. All the while, the banks continue to get paid and the rich get richer.
“Also if we allow competition in currency wouldn’t this be a great way to greater divide the rich and poor? they get one currency, we get another. They can keep me out of their stores. It would be like a monetary caste system.”
This question is partially answered in the first section of this response. To answer more specifically, probably not. If the elite businesses, the rich stores posed in your question, wanted to keep people out today, they easily can and do. Elite private clubs and businesses only cater those with enough money to purchase their high-priced memberships, goods and services. If there was some desire for more businesses to do this today, I think they’d already be doing it. However, most businesses are out to make a profit from anyone, and I don’t see this changing just because we stop using Federal Reserve Notes and start using Dubloons, Widgets, Obamlets, Bidencoins, or any other sort of money that might arise. It is an interesting question though, and I’d like to hear if you have any further reasoning on why you think this type of discriminatory behavior would proliferate if competing currencies were introduced.
Puck,
“Can’t we just use some kind of Jesus Bucks?
You know – a faith-based currency.”
Hahaha, interesting thought. That would be the ultimate embodiment of the faith-based currency we have now.
Here’s what the currency deniers don’t understand: Our US currency is backed by our willingness to do work to get it. Money has value only because people are willing to work to get it. Money commands work. It is backed by labor – by people. Which is worth more than gold.
To the extent our rentiers and bankers succeed at getting money parasitically without work or even risk, our currency becomes devalued, and those who work honestly for it get less of it.
Egads! Rentiers? What next, arbitrageurs?
Les arbitrageurs aussi.
“Here’s what the currency deniers don’t understand: Our US currency is backed by our willingness to do work to get it. It is backed by labor – by people. Which is worth more than gold.”
Excellent point. Demand, or willingess to do work to get something, makes a currency valuable. People are the key; this is true in any economic equation. Gold has value because people want it. A currency backed by gold isn’t valuable because of some inherent value in gold, but because people value gold and therefore value that currency. As you point out, today’s fiat currency systems and Federal Reserve notes work the same way. People’s desire to have the currency is what makes it valuable. In the example above, the “Delaware Monetary Union” issued currency would only be valuable if people were willing to accept them.
“To the extent our rentiers and bankers succeed at getting money parasitically without work or even risk, our currency becomes devalued.”
I’ll agree with this statement to an extent, and that is that bankers illegitimately devalue our currency through the ultimate in “making money” without work or risk, that is, by printing it at will and funneling it to their cronies. This inflation of the currency is better known as counterfeiting, were we to be truthful about what’s going on between the Federal Reserve, banks, and mega corporations.
“currency deniers”
I’m going to hazard a guess and assume this was directed at me, though I’m not sure why you think I “deny currency.” I believe in it as a necessary component of our society. I just don’t believe we should adhere to a system run by thieves and charlatans.
WU, your cloak of reasonableness is paper-thin.
Puck,
While our philosophies most likely do not line up 100%, this is one area where we ought to have a lot of common ground. It’s us versus the establishment. Right now, the establishment is winning big time, and currency manipulation is their greatest tool in maintaining the status quo.
Thank you for your time and consideration.