Daily Archives: July 1, 2011

Here we go: Schumer says Dems are discussing whether WH can ignore the debt ceiling

As I said last week when I wrote about this, I’m morbidly curious to see how the public would react if he pulled something radical in the name of staving off economic calamity. He’s already ringing the alarm bell by demanding a deal by July 22, ten days before we hit the ceiling on August 2, in order to avoid frightening international markets. Democratic messaging is ramping up too: Paul Krugman wrote a quintessentially Krugman-esque piece this morning about how those darned wingnuts want to wreck Obama’s presidency on the rocks of economic armageddon. Expect lots more of that after the holiday; given the public’s utter desperation to see the economy improve, the “sky is falling” approach to the debt ceiling is a way more effective line of argument for Democrats than mumbling about corporate jets. And in fact, the sky really might be falling. And yet, if he did pull something like declaring the debt ceiling unconstitutional, he’d be seizing control of the country’s apocalyptic debt problem for the purpose of running up more debt. I doubt it would even accomplish what he wanted it to accomplish: If the goal here is to reassure creditors that the U.S. will never default on its obligations in order to avert a market panic and skyrocketing interest rates, how exactly would a power grab involving an utterly novel constitutional theory achieve that? Does a bitter court battle, with the legality of payments issued on Obama’s unilateral order hanging in the balance, sound like a smart way to put investors at ease?
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