The Trillion Dollar Question

The Trillion Dollar platinum coin is riding a wave of coverage today, demonstrating yet again that stupidity can circle the world three times before common sense can put its boots on.

Two of the sillier arguments: Joe Wiesenthal of Business Insider declares that the new bill by Congressman Walden to bar this ploy implicitly legitimizes the current interpretation:

We've posted his full press release below, but the key thing here is that the idea is now legitimized, as a GOP Congressman implicitly acknowledges that the coin idea is currently legal.

We have not seen the language of the bill yet but it will probably amount to a clarification of the existing Treasury authority to mint platinum coins subject to the same framework that already applies to silver and gold coins.

The key constraint is that Treasury must sell coins for their bullion value (plus a reasonable premium to cover striking, marketing and administrative costs). Language asserting that Congress always intended just that hardly equates to an admission that Congress meant something else. It does admit the possibility that the current law is subject to misinterpretation, but that is still a long way from declaring the misinterpretation to be "currently legal".

The second failure of common sense is the notion that Obama can proceed safely here because literal interpretations of the law will only blow up in Republican faces. Really? As we speak, a court fight over a glaring drafting error in ObamaCare is percolating:

Critics say the law allows subsidies only for people who obtain coverage through state-run exchanges. The White House says the law can be read to allow subsidies for people who get coverage in federal exchanges as well.

The law says that “each state shall” establish an exchange. But Washington could be running the exchanges in one-third to half of states, where local officials have been moving slowly or openly resisting the idea.

Can we hear from an Obama supporter? Yes We Can!

Prof. Timothy S. Jost, an expert on health law at Washington and Lee University, said Congress had made “a drafting error” that should be obvious to anyone who understands the new health care law.

“There is no coherent policy reason why Congress would have refused premium tax credits to the citizens of states that end up with a federal exchange,” said Mr. Jost, who supports the law.

A drafting error! It's almost analogous to the Trillion Dollar Coin situation, except totally different because liberals progressives are on the other side. Well, and Congressional intent is probably a lot more ambiguous, since Federal benefits such as block grants administered by the states (welfare, Medicaid) have a real history and fan base in Congress.

Kevin Drum continues with his 'Do The Right Thing' approach in which he exhorts his fellow travelers to embrace the rule of law, not men. Good luck - next he will want the War Powers Act to be enforced, or something.

Josh Barro, nobody's fool, makes the lesser of two stupidities argument in favor of the coin. I offered that same "least awful" argument last summer, so I can't hoot it down now.

Lots more links at Memeorandum. I will offer this free legal advice from a non-lawyer:

Congressional intent in adding the language about platinum was crystal clear - they wanted Treasury to have authority to sell collectible coins for their bullion value, as was being done with silver and gold. So where this Trillion Dollar coin idea fails will be in the matter of the Secretary's discretion:

(k) The Secretary may mint and issue platinum bullion coins and proof platinum coins in accordance with such specifications, designs, varieties, quantities, denominations, and inscriptions as the Secretary, in the Secretary's discretion, may prescribe from time to time.

What, a court may reasonably inquire, does "the Secretary's discretion" actually mean? Can the coin include obscenities? Political slogans? "Bush 2004!"? "Platinum Change You Can Believe In"? I suspect a court would find that the Secretary's discretion in terms of design would be viewed as limited by factors outside of paragraph (k) quoted above.

More importantly, with other coins the Secretary has discretion to set denominations for gold and silver coins subject to the rule about selling the coin at its bullion value, and subject to overall limitations on the stock of coins and currency in circulation. Maybe a court will decide that since the Congress does not re-specify the exact nature of the Secretary's discretion each time they use the phrase, that discretion is unlimited. Maybe! But I doubt it.

As a practical matter, if (IF!) Obama wanted to proceed with this, Turbo-Tax Tim Geithner would sit down with some Treasury lawyers and try to get them to opine that the Trillion Doillar coin was within his discretion. After the laughter died down maybe an Administration lawyer would agree to fall on his word processor and deliver the necessary blessing. But that wouldn't end the drama.

Over at the Fed, their lawyers would be asked to opine on whether Treasury can really do this, because if not, the Fed obviously cannot be writing Trillion dollar checks for $1000 worth of platinum. Pushing those lawyers to compromise the Fed's independence won't be easy, and playing along with this sort of potentially inflationary gambit that is beyond the control of the Fed is hardly something the Board of Governors will be eager to get behind.

So - this scheme has legal obstacles and a legal foundation that will collapse the first time a judge gets a look at it. There is no way it can be done quickly, and almost surely not secretly either (unhappy opponents will leak word of the discussions).

But keep thinking...

Comments

[Ignatz Ratzkiwatzki]

--Kevn Drum continues with his 'Do The Right Thing' approach in which he exhorts his fellow travelers to embrace the rule of law, not men.--

Does platinum cause crime?

[NK]

TomM said: "So - this scheme has legal obstacles and a legal foundation that will collapse the first time a judge gets a look at it. There is no way it can be done quickly, and almost surely not secretly either (unhappy opponents will leak word of the discussions).
But keep thinking..." IMO the Obamaniacs have ALREADY decided what they will do IF the House Repubs refuse to back down and increase the Debt Limit when Barry I pulls the Default Gun-- the new Treasury Secy will issue T-Bonds DESPITE the statutory limit having been exceeded, and BenB will print the money and buy the bonds. Constitutional crisis follows- maybe even a financial panic that makes Lehman/AIG melt downs look like a marshmallow toast at a sunday evening Middlesex Club BBQ.

[gmax]

I thought I had heard every hair brained scheme every cooked up. Not even David Stanford would have been so brazen and stupid as to try this one. DOA or maybe stillborn. Don't waste valuable time and effort

[Clarice]

Just as stupid as the now scrapped effort by Illinois' brightest to ban guns.
BTW has anyone every found anything sensible and true in Business Insider? To my recollection, I have not.

[NK]

Josh Barro? I read that drek in Bloomberg. what a fucking idiot. That was shorter but just as moronic as the taibbi TARP -- thing. God the Left has no fucking decency. They admit their ideas are moronic and juvenile-- but they demand we do them ANYWAY, b/c those evil Repubs refuse to do what Dear Leader and Krugman demand.

[Clarice]

Thinking about these "drafting errors"--why not take further the scheme used to get Obamacare passed? Take a bill, strip out everything but the no, and title, pass it, and let progressives tell us what the blank bills means....

[NK]

gmax@645-- and Bernie Madoff is laughing in his cell.

[narciso]

It's run by a Trig denialist, convicted investment scammer, what could possibly go wrong. Robert Barro's apple fell far from the tree, no.

[narciso]

Allen Stanford, btw, get the scammers right.

[Ignatz Ratzkiwatzki]

Joe Weaselthal is one of the least professional journalists it has been my displeasure to read. IOW a perfect fit for the crook Blodgett and his stable of hacks.

[matt]

Doesn't this whole thing get down to a basic Constitutional issue of the House as the only body allowed to present budgets?

The trillion dollar coin is simply an end run around one of the primary responsibilities of the House.

[gmax]

Allen Stanford is of course right. Narc you have the mind of a steel trap. How do you do it?

Ponzi is definitely pissed he did not think of this one, though...

[gmax]

Henry Blodgett is no longer allowed to participate in financial transactions regulated by the SEC, due to irregularities so now he passes out liberal pablum on Yahoo to the delight of the low information investor to no great surprise...

[narciso]

Well he and Scott Rothstein, split the scams down here, whereas Madoff focused mostly on NY.

[gmax]

Blodgett is banned for life, and was charged with civil securities fraud...

[Rick Ballard]

"Robert Barro's apple fell far from the tree, no."

Narciso,

It's an illustration of the dangers of raising children underwater in Love Canal. Giving babies lead lollipops would be safer than letting them breathe the fetid air of Cambridge.

[NK]

RickB@7:15-- you have a way with words!

[narciso]

I expected something more sophisticated then a kindergartener, maybe some thing with fancy graphs, and greek symbols, not this;

1. "That's silly/zany/juvenile!" This is probably true, but it's not a dispositive objection. Republican intransigence over the debt ceiling is juvenile. There is no particular reason that the president should not use a juvenile strategy in response.

[boatbuilder]

Free money! So what do they need to raise taxes for?

[boatbuilder]

"Prof. Timothy S. Jost...said congress had made a 'drafting error' which should be obvious to anyone who understands the new health care law."

Well, since nobody understands the new health care law, except as a federal power grab and step one in imposing a single payer system, I suppose it follows logically that the law means that the feds get to do whatever they think they need to do to get there.

[narciso]

I'm sure Nurse Ratchet, I mean Sibelius, will get around to correcting the rule,

[narciso]

And since we're reviewing the absurd,

http://drezner.foreignpolicy.com/posts/2013/01/06/its_has_the_gop_gone_insane_on_foreign_policy_week

[MarkO]

I have this feeling that we ain't seen nothin' yet.

[Ignatz Ratzkiwatzki]

If one or two trillion dollar coins would be good wouldn't 313 million of them be even better?
Think of the tax receipts on 39.6% of 313 Trillion in income.

[Thomas Collins]

See LUN for a short Volokh article, with extensive links, on whether the debt ceiling is constitutional. Another interesting question is whether anyone has standing to challenge in court a POTUS' exceeding the debt ceiling.

Although the legal issues (platinum coins, constitutionality, standing, and others) are interesting, they are essentially irrelevant, in my assessment. What is relevant is that at present, the US Government is incontinent in its ability to control current spending and reduce future entitlements. Most of the blame falls on the Dems, although the GOP is not blameless. Until this incontinence is cured, these short term cliffs and ceilings are distractions.

[Ignatz Ratzkiwatzki]

Sorry, that was supposed to be 313 million trillion in income.

[Mad Jack]

Liking that vaunted Irish defense. Ouch that was quick.

[Clarice]

Iggy--you beat me to it. But I like Jim Treacher's idea: "I'm going to mint some coins that say "However Much Money I Owe" and send one to the IRS every year. Think that'd work?"

[narciso]

Well here's another reason to root for Alabama, in the LUN,

[Beasts of England]

Certainly early, but I'm encouraged... Roll Tide!

[The Suggester]

" circle the world three times before common sense "

The owner of this blog should have written "...before common cents".

[Gus]

I just got a platinum card in the mail!!

I'm rich!!!!

[Danube of Thought iPad]

This game is l'histoire.

Disgraceful showing by the once-proud Irish. Good.

[narciso]

Seriously, they should at least pretend they are in the game, for appearances at least.

[bgates]

Clarice's 6:48 and boatbuilder's 7:37 suggest a problem for the original public meaning school of interpretation which has been introduced by the megabills of the past few years. Can Obamacare be said to have an original public meaning, since it was not originally public? Original intent seems like a much more useful framework here; supporters of bills passed during the Obama administration intended for good things to happen to good people and bad things to bad, which should simplify interpretation considerably - as long as the judiciary is clear on who is who.

[Carol Herman]

Can you get change?

Today, if you go into a retail store. And, all you have in your pocket are a few Benjamins ... Unless your purchase if for $100 ... You're not going to get change for it.

Heck, even McDonald's doesn't allow its cashiers to change more than a $20.

So? A trillion dollar coin. It better be large enough so you can't fit it into your pocket. And, have a lead, magnetic weight, on the bottom. So for safe keeping you can store it with the hopes no one can pry it off.

Of course, if they do ... they can't spend it.

Oh. And, if you're traveling with one ... what happens when you go through the line, with your shoes off ... to catch a plane. But you're stopped by the TSA?

[Rick Ballard]

"as long as the judiciary is clear on who is who."

That's easy. Lawrence Tribe has the list in his office at HLS. He'll call Chief Justice Roberts with instructions if there's even a shadow of a doubt as to which ox gets the horn.

[Gus]

What's more than a trillion??? Gazillion??

Let's do it!

And we can all be rich!!! Yeeeehaw!!

[narciso]

The problem with that single coin, assuming a spot price of 1550, an oz, that's a two hundred ton coin, that's like the Giant twinkie in Ghostbusters 2

[cathyf]

Band is doing the Back To the Future act. SHUT UP stupid talking heads!

[Beasts of England]

cathyf@10:12 - Congrats on having a band member on the field - very nice!

[cathyf]

Now playing is an all-star band made up of the best h.s. players in the country. The ESPN bastards are playing their own stupid theme songs over the video of the h.s. band playing. Scum.

[Clarice]

My yahoo mail allows me to read but not respond to or compose messages. Nothing I've tried has worked. I hope to get it resolved soon but in the meantime forgive any tardy responses.

[bgates]

That's odd, Clarice. I have a yahoo mail account and just started having the same problem about an hour ago.

[Melinda Romanoff]

Let's ask Robert Mugabe, noted numismatist, just how well all those extra zeroes helped their economy, and then making them go "POOF"!

[Melinda Romanoff]

bgates-

Might it be Yahoo stepping in front of a new hack with a server squash?

[bgates]

Clarice, I found a couple of people on the yahoo answers page who reported the same problem within the past 10 minutes. Thus far they have no answers. It is almost certainly something yahoo did, not something you (or I or those other people) did, so we should all quit trying to fix it and let yahoo figure out their own problem.

[Melinda Romanoff]

Shut the imap and stmp, would be pretty easy, no?

[Gus]

Mugabe was all about REDISTRIBUTION.

How's that working out Melinda?

[Melinda Romanoff]

bgates-

I blame Schmidt and his little trip.

[Melinda Romanoff]

Mugabe was all about personal allocation, and THEN redistribution.

You missed a step.

Then they devalued a fourth time in '09 and now their economy, diminished as it is, is now growing again.

[Clarice]

Well bgates, yahoo is probably just trying to beset the really special subscribers. XOXO I'll leave it to them then The yahoo mail gets worse every day.

[Jim Miller]

Mel - That's the first plausible explanation I've seen for Eric Schmidt's trip to North Korea.

[Melinda Romanoff]

Jim-

If you could go to the Hermit Kingdom with a Sat phone, Hyper laptop, and a CIA satellite link to DC for a sales job for one narcissist that you donated millions to get re-elected, would you make the trip to open the Kingdom and make said narcissist look good?

I'll wait for your answer while I hold my breath.

[narciso]

So, this isn't a fair prediction, of future trends;

http://www.voazimbabwe.com/content/zimbabwe-tendai-biti-economy-2013-budget-projected-growth/1525597.html

[Melinda Romanoff]

narciso-

Do you understand to what depths they had to fall in order to achieve that growth?

[Jim Miller]

Mel - All right, that's two explanations.

But, credit where due, Google actually gave some good coverage last year to a North Korean escapee.

[Jimmyk]

"Then they devalued a fourth time in '09 and now their economy, diminished as it is, is now growing again."

They tied to the dollar, didn't they? That saved them, but we'll see how long that lasts.

[Ignatz]

Bear Saban?

[narciso]

From this in the LUN, they have a long road to crawl back from;

[Melinda Romanoff]

jimmyk-

Did they? I thought it was the stripping of 12 zeroes from the third Z-dollar for the 4th Z-dollar. I might have missed some thing in all of the excitement.

[Gus]

Melinda, heck yeah, you're right. But MugAMA is about personal EVERYTHING first.
One thing about COMMIES. They love themselves first, and the proletariat second.

[Clarice]

I loved PUK's riffs on Zimbabwe..Didn't we all though?

[cathyf]

Grampa brought WonderBoy a Zimbabwe million-dollar bill a few years back. It's not clear whether it is worth any less today. For example, folded up and inserted under a wobbly table leg, or fire starter for roasting marshmallows, bookmark -- it's probably still worth the paper it's printed on!

[Melinda Romanoff]

narciso-

Not if they manage their coming oil pipelines well. I fear they will have the same luck Nigeria enjoys, unfortunately.

[Danube of Thought iPad]

MarkO was kind enough to alert me to this very cogent column on the current gun hysteria at the LUN. As good as anything I've read.

[bgates]

Mel, it's not even a problem with the mail in transit (then it would have to do with the mail servers, which as far as I'm concerned means dark arts and bad juju). It's within the browser, which means it's javascript, which means even if they skipped manual testing (which would be bad) and skipped or missed it in automated testing (which would be worse) they should be able to roll the change back through version control within seconds after they got reports of the problem.

[Melinda Romanoff]

bgates-

So much for some Sunshine to the problem, where even the kernels might be popped. Nice problem.

There will be a lot of NoSleep being passed around.

I wish them well in their comparative hunt and vaccination efforts.

G'night all.

[narciso]

Biti, seems to be one of the good guys, part of Tsivirai's crew, but his projections are wildly unrealistic.

[Captain Hate]

Where is Beasts? Off enjoying the carnage I'm sure. I blame Pitt for blowing a lead to these pretenders. Did any of you guys hear Brent just about losing it on McCarron's girlfriend? I'm sure he was heavily invested in ND and then started getting hammered when the outcome became obvious.

[bgates]

this very cogent column on the current gun hysteria

The fact is that we have something very widespread in this country which, every once in a while, will kill or injure an innocent child. Proponents of this state of affairs claim that "only" one out of some large number - a hundred thousand, or a million, or more - are killed or injured. But the fact remains that this part of our culture is so widespread that the deaths of a certain number of children are inevitable, and we're allowing the deaths to happen based on an 18th century theory that by doing so we're preventing worse problems.

But enough about immunizations; yes, that column on gun control was good.

[narciso]

How could you tell when he was getting hammered,

[cathyf]

I wonder if yahoo has some serious breach going, and they've simply shut down every yahoo account's ability to send mail.

[Gus]

Bgates, tell me, inform me, of a Marxist/Communist/Chavezist/Castroesque COUNTRYY or CULTURE, where there are less CHILDREN IN DANGER, killed or maimed???
The CURE is WORSE than the ILLNESS.

[narciso]

Entrail reading has a new seer,

http://www.huffingtonpost.com/mark-boslough/

[Danube of Thought iPad]

I don't want to oversell that gun hysteria column, but I must say that reading it made me focus more intently on something I suppose I had already known: this is madness. The Feinstein/Emanuel/Democrat approach to this issue is simply madness.

[Gus]

Danube, it is. The whole concept is thought out by the likes of EMANUEL. Feinstein is just an emotional idiot, and a practiced LIBTARD MORON. But what strikes me so much more Danube, is how far down the RABBIT HOLE we ARE, and it seems normal to the MEDIA and most UNIFORMED idiots.

[narciso]

Well lets see, we have a then unknown politico who was catapulted to Mayor and then national office, by a single act, the Harvey Milk shooting. We have a President who besides community organizing, his other interest he shared with a former?? terrorist, was curtailing gun violence, I thought the AWB came from the Ferguson atrocity, but apparently it came as a result of an incident in San Francisco, in 1993,we see the impact of Port Arthur and Dunblane, and how they didn't solve the problem, they were concerned with.

[Holly]

"once-proud Irish"

Nope. Still proud. The ND kids on the field are truly amazing. They're student athletes, a rare breed.

[Beasts of England]

Capt. Hate@11:21 - A little speechless, yet enjoying a fine victory. Proud that my older daughter has enjoyed three NCs in her four years at the Capstone!

[Beasts of England]

Ignatz@10:58 - Bear Saban works for me...

[narciso]

So, what the lineup from here on in,

[Gus]

Sabin is a MERCENARY. He is also UNQUESTIONABLY one of the top 2 or 3 College Football coaches of all time. Good Lord, I hate to type that, but it's true.

[narciso]

He's good, but from our experience, lets wait a bit before putting him in the same company as Bear Bryant, I'm just saying,

[Another Bob]

The Yahoo mail issue is apparently an XSS exploit that is a vulnerability for all major browsers. Yahoo says they've fixed it.

I'd flush cache and cookies, and change password.

[Another Bob]

And, obviously, don't follow links from an email unless you're positive you know what it is.

[bgates]

The Feinstein/Emanuel/Democrat approach to this issue is simply madness.

Do you think they think what they're trying will really save lives? That would be madness; if a man with evil in his heart and any number of common but potentially lethal objects enters an elementary school he'd be able to barricade himself in a classroom for long enough. If they want to eliminate this danger by banning things, they won't be able to stop until forks, phone books, and fire have been outlawed.

[Gus]

bgates. To demogogue LIBTARDS..(excuse the stolen term) LOW INTELLECT politicians and their LEMMING followers, the KNEE JERK, is the HIGHEST LEVEL of THOUGHT they possess.
Add to that, the preconcieved PROCLIVITY to the IDEA/IDEAL of GUNS BEING INHERANTLY EVIL,and you have......STUPID IS AS STUPID DOES.
Basically LIBTARDS, and this recent and current MARXIST strain of raving idiots, has the PHILOSOPHY of CONTROLLING THEIR FREE AMERICAN POPULACE and CONSTITUENCIES.
They know better, and they will DO GOOD. Your FREEDOM, cannot be trusted.

[Gus]

bgates, the cherry on top, is that LIBRARD/MARXISTS,then bribe their USELESS IDIOTS with freebies and promises of protection, health care and goooodies.

[daddy]

bgates,

Your 11:22 is even more brillianter than normal! Absolutely outstanding. What a treat to read that and get to the punchline:) Thanks.

[Jane: Mock the Media]

Clarice,

I've had that problem with my yahoo account, off and on, for months.

[Jim Ryan]

At least Yahoo fixed its weather page that didn't work after they redesigned it.

[Jim Ryan]

This anti-gun group of Gabby Giffords's - Americans for Responsible Solutions - shouldn't it be Americans for Responsible Solutions Everywhere to get the acronym right?

And do we need both Giffords's new organization as well as James Brady's group? Couldn't they team up?

And when will we see a public servant who has gotten shot in the head by a criminal subsequently decide to form an anti-criminal group?

[Jim Ryan]

While I'm thinking of it, does anyone have a link to a place to buy blueberry pills? Thanks in advance!

[narciso]

Speaking of which, the released the only Benghazi suspect, Al Harzi, 'for lack of evidence'

[James D.]

I read the Drezner article narciso linked to last night, and I'd like those five minutes of my life back.

I thought he used to be at least halfway sane (Drezner, I mean). What happened?

[Annoying Old Guy]

I thought he used to be at least halfway sane (Drezner, I mean). What happened?

Reality dysfunction. Since his basic ideas don't actually work in real life, he had to chose between ending his belief in them, logic, or reality. You can see the result.

Heh. "Logic, reality, modern liberalism - pick two".