Debt Ceiling 2013 has its own mini-meme: platinum coins. US law governs the circulation of paper money and gold, silver and copper coins – but not platinum coins. As such, the idea goes that the US Treasury could order up a couple of platinum coins, value them at $1 trillion, and deposit them at the Federal Reserve. The Fed could then transfer that value to the US Treasury, which could use the money to pay the government’s obligations.
Effectively, the move would use the Fed’s monetary powers to defuse Congress’s fiscal time bomb without, some say, inflationary issues related to printing money because the Fed is helping to continue current levels of spending, not fueling higher expenditures.
In the Twitterverse, the econo-dweeby set has even given this whimsical proposition its own hashtag: #MintTheCoin.
The downside? The president will have financed the budget of the United States with a massive gimmick that could face all sorts of legal challenges. If America’s credit rating took a ding from 2011’s debt-ceiling debacle, what would happen if the actual solution took the form of platinum coins?
The president has said it’s a no-go – could you imagine Obama flashing a couple of platinum coins at a press conference, making Boehner spit out his Cheerios in the Capitol? – but even the discussion has raised hackles among Republicans. Rep. Greg Walden (R) of Oregon introduced legislation to ban such a possibility.
“Congress has the responsibility and the sole authority to raise the debt ceiling,” White House spokesman Jay Carney told reporters Wednesday, “and Congress must do it’s job.”
