Are you going to Scarborough Fair
Parsley, sage, rosemary, and thyme
Remember me to one who lives there
She once was a true love of mine
From England long ago comes the song “Scarborough Fair”, more recently popularized by Simon and Garfunkel. It struck me as somewhat of an allegory to the debt ceiling. Allow me to explain.
Congress tells the Executive what taxes may be levied, and on whom. This restricts how much money the government can collect from the citizens. And there’s nothing wrong with this; it’s Congress’s job to lay this out, either with the President’s approval, or over his veto. Ultimately, then, Congress decides roughly how much money the government will collect to perform its duties.
Congress also tells the Executive how much money is to be spent, and on what. Unless explicitly granted Congressional approval to do otherwise, the President must spend the specified amount on the specified budget items. Again, there’s nothing wrong with this; it’s Congress’s job to lay this out, either with the President’s approval, or over his veto. Ultimately, then, Congress decides how much money the government will spend to perform its duties.
Tell her to make me a cambric shirt
Without a seam or needle work…
This means that Congress can demand that the President spend more than he takes in. For the past decade, this is exactly what has happened. In some cases, it’s the current Congress that explicitly makes the demand; in other cases, it’s past Congresses who made the demand, and the current Congress hasn’t overruled the demands of the previous Congresses.
The upshot is the same, regardless. More money is spent than is collected. In order to achieve this, the Treasury, as part of the Executive Branch, issues debt. The only alternative would be to devalue the currency, allowing the government to pay the nominal bills, albeit by effectively reducing the real amount paid.
So what happens if Congress also puts restrictions on debt issuance? Until 1917, Congress explicitly authorized each debt issuance individually. This slowed the process, but the outcome was always the same. Congress had already authorized the spending, and had established the tax policy, so any excess spending was covered by debt issuance, with Congress’s explicit approval. In essence, it made issuing the debt a formality. Because of this, Congress changed the process in 1917 with the Second Liberty Bond Act, which paid for part of World War I by instituting an early form of debt ceiling. Specifically, Congress authorized debt to be issued up to a specific amount. The modern implementation, with a general debt ceiling, was established by the Public Debt Acts of 1939 and 1941, whereby the Treasury is authorized to issue debt on an as-needed basis to fund government operations, provided the total debt does not exceed the limit.
The goal here was to maintain Congressional oversight of debt, as is their Constitutional role.
Tell her to find me an acre of land
Between the salt water and the sea strand
The Executive is limited in how much can be collected, limited in how little can be spent, and limited in how much debt can be issued. With the passage of the 14th Amendment, this makes it possible for Congress to put the Executive in an impossible situation.
By virtue of Congress stipulating both taxation and spending, Congress already tacitly approves the debt. Adding a second layer serves only to reduce clarity of intent. Since the President cannot choose what required spending is to be ignored, and the President cannot choose to unilaterally collect more taxes, there is no “correct” action. So what is the President supposed to do?
Once Congress sets up the taxation and spending policies, the die has been cast. The debt ceiling itself serves no purpose other than providing opportunity for Constitutional crises. It’s time for it to go.
- The Debt Deal’s Fake Spending Cuts (reason.com)
- Do We Really Need A Debt Ceiling? (jonathanturley.org)
- Op-Ed Contributors: Our Unbalanced Democracy (nytimes.com)
- Charting America’s Ominous History Of Debt Ceiling Increases (riehlworldview.com)
- Doing Away With the Debt Ceiling (economix.blogs.nytimes.com)
- US debt limit really doesn’t limit debt (seattletimes.nwsource.com)
- Congress failing to do its duty creates an Imperial President (amanwithaphd.wordpress.com)
- Could a Debt Ceiling Veto Be Unconstitutional? (volokh.com)