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My understanding is:

  • The 14th amendment says that any debt the United States has taken on must be honored.

  • Previous legislation by Congress prohibits the government from borrowing more than a certain amount of money.

So far so good. I could probably understand the argument that the US government has the constitutional authority & duty to print any money needed to service the current debt. But I don't understand how the 14th amendment could possibly allow an increase of the debt ceiling as some are claiming.

How could the obligation to service existing debt (by printing money, presumably) possibly confer the authority to take on new debt? What is the legal reasoning that would reach this conclusion from that premise?

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    – Dale M
    May 22, 2023 at 22:03

2 Answers 2

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Congress passes, and the President signs, a legal binding budget for the Federal Government that in broad strokes dictates "we will spend $6.2 Trillion dollars".

They pass this budget, knowing full well that estimated Tax Receipts (how much money the Government takes in) will only be about $4.4 Trillion.

The gap (deficit) of $1.8 Trillion must be borrowed, creating debt.

The problem is that the Budget is legally passed and describes $1.8T to be financed, even though the Debt Ceiling limits that.

The question is which one takes priority? The Constitutionally mandated Budget, or the Congressionally created Debt Ceiling?

The 14th Amendment seems to indicate that the fulfilling the Budget has a higher priority than the Debt Ceiling construct.

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  • I think the question at hand is about "the deficit must be borrowed". OP seems to be thinking that instead of borrowing $1.8T, the government should simply print $1.8T of money and spend it as directed by Congress. May 20, 2023 at 5:44
  • "The question is which one takes priority? The Constitutionally mandated Budget, or the Congressionally created Debt Ceiling?" What makes the budget constitutionally mandated? It's just a law passed by Congress as well. The Constitution says that they can't default on debt, not that they're obligated to spend everything in the budget.
    – nick012000
    May 20, 2023 at 7:08
  • @nick012000 While the Constitution does not unambiguously assert that Congress must produce a (yearly) budget, it is implicit that this is a required activity and is typically interpreted as a required part of the job. However the courts have largely denied themselves any power to force Congress to do such a thing. Heck, they don't even allow themselves much power to make them do the Census, and that does have an unambiguous constitutional mandate. But in this case you have a budget and appropriations already passed, so there's no issue with trying to force one to be done. May 20, 2023 at 22:36
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    The issue is in exactly how the balance between obligations to debt under the 14th amendment (including how these are even interpreted) and Congress's essentially total control of the purse, including debt payments, is balanced. There is a school of thought that says the 14th amendment really only says that we cannot unilaterally wipe out our debt, but says nothing about forcing us to pay it. If so it allows us to basically go "Yep, we have 30 trillion in debt. We're not paying any of it right now, but it exists; maybe we'll pay it later?" But courts might call that a de facto nullification May 20, 2023 at 22:37
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    Strictly speaking, it is the appropriations bills that are binding legal authorizations to spend and the budget bill is just an internal Congressional rule or guideline, but the meaning is clear enough.
    – ohwilleke
    May 22, 2023 at 17:58
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The federal government doesn't have the authority to print money. Under the Federal Reserve Act, Congress granted that power exclusively to the Board of Governors of the Federal Reserve System ("the Fed").

So if the government needs dollar bills to make payments on outstanding bonds, and doesn't have enough from tax receipts or other such income, the only place to get them is from the Fed. The Fed can in principle print as many as it likes, but it doesn't give them away for free; it will only give them to the government in payment for something of value, and normally that "something" is bonds. So the government can only "print more money" indirectly, by issuing more bonds and selling them to the Fed: i.e. taking on more debt.

(The government does retain the authority to mint coins, and there is a frequently raised suggestion that the government could "print more money" by minting a trillion-dollar coin, and selling that to the Fed instead of bonds. I won't go into that here, but suffice it to say there are a lot of potential legal objections.)

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    This is nice information, but doesn't really seem to answer the specific legal question I asked. Aside from the $1T coin and getting the Fed to just money out of thin air, the government could (and I'd argue must, but whatever) also use existing revenues to prioritize & pay off creditors before any other spending authorized by Congress, right? So in what way would the obligation to honor existing debts confer the authority to take on more debt? I still don't see the logic there. It seems they have a ton of ways to service existing debts without taking on more; they just don't like them.
    – user541686
    May 20, 2023 at 7:50
  • Moreover, I see another problem with that argument. Even if the other solutions above are all somehow illegal, why is taking on more debt any different, given that's also outlawed by Congress? Heck, if the mere existence of this mechanism somehow confers the authority to use it, then why stop there? Why not just collect more taxes than Congress authorized and then justify it with "oops sorry we don't see any other solution! the constitution requires us to pay our debts somehow!"?
    – user541686
    May 20, 2023 at 8:01
  • @user541686: The laws passed by Congress require the government to do three things: (1) collect $X in taxes, (2) spend $Y on the programs that Congress created, (3) do not exceed $Z in debt. If the government does all three of those, they will be unable to make payments on existing obligations, which the 14th Amendment says they must do. So the argument is that the combination of 1,2,3 is unconstitutional, and the government is not required to obey all of them. Violating (3) is much less disruptive than the other two alternatives so it's the choice that the government will prefer. May 20, 2023 at 8:42

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