Debt Fight Could Give Obama More Budget Powers

May 16th, 2011 at 10:21 am David Frum | 17 Comments |

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Some Republicans suggest that there’s no special need to worry about hitting the debt ceiling: after all the Treasury will still collect much more in revenue than it spends on interest payments. The Treasury can continue to pay bondholders while ceasing to pay other bills.

Do these Republicans understand that even assuming this idea were legally and technically feasible (which it is not), it would amount to handing President Obama recission authority over the entire federal budget?

Under this scheme, if feasible, could the president decide: OK then, I’ll just stop paying Medicaid bills in states led by Republican governors?


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17 Comments so far ↓

  • Mark Rosenthal

    It’s a damn shame that it has come this far. Brinksmanship is one thing, but this is practically economic suicide.

  • indy

    recission authority? Editor in aisle 8 please.

    Edit: oops, don’t I have egg on my face? Badly misread the sentence.

    • Bunker555

      ThesaurusLegend:
      Noun 1. recission – (law) the act of rescinding; the cancellation of a contract and the return of the parties to the positions they would have had if the contract had not been made; “recission may be brought about by decree or by mutual consent”

      cancellation – the act of cancelling; calling off some arrangement
      law, jurisprudence – the collection of rules imposed by authority; “civilization presupposes respect for the law”; “the great problem for jurisprudence to allow freedom while enforcing order

  • balconesfault

    Under this scheme, if feasible, could the president decide: OK then, I’ll just stop paying Medicaid bills in states led by Republican governors?

    Why would you even ask this question? Next thing we know it’ll be a right-wing internet meme, like the preferential closing of Chrysler dealerships owned by Republicans, and the black helicopters that only seem to fly when a Democrat is in office.

    • think4yourself

      Yep, can’t wait for Rush L to be saying this as a Democratic policy and Beck, connecting the conspiracy dots.

  • sunroof

    Hmmm, let’s see, subsidies to Florida sugar barons? Gone. How many Republican donors could Obama target before touching a single Medicare/Medicaid recipient? Might be exciting to watch.

    • dante

      That’s my guess on it too… Forget going after something as blatant as Medicare recipients in states with GOP governors, but rather any/all budget items that he disagrees with: Oil subsidies, agricultural subsidies, pointless military hardware like the additional F-35 engine (or whatever), federal spending on faith-based programs (thanks GWB!!), etc. Basically set it up so that if the GOP shuts down the government, all of *their* programs will be hurt.

  • ottovbvs

    Actually the president has powers to protect national security and the efficient functioning of the economy which he can invoke if push comes to shove. These powers have previously been delegated to him by congress. Presidents regularly ignore the war powers act so faced with the first default in our history it’s not inconceiveable that the president could ignore congress’s budgetary powers. Of course there would be legal challenges but these would take months to play out. And as Frum and several have observed the admin has entire discretion over the discontinuance of payments. Many Republican sacred cows will be gored in the process.

    • stuartamills

      In ignoring the debt ceiling the President would be ENFORCING congress’s budgetary powers since the debt is the result of spending previously authorized by congress. He would be ignoring the unconstitutional debt limit ceiling (14 th amendment, section 4).

  • Graychin

    Obama could start with rescission of all federal highway funds due to be sent to the districts of Republican congressmen.

    They really like going to those ribbon-cuttings for projects they voted against.

    Congressional salaries would be another good place to begin the rescissions.

  • maxfieldj

    Politicians in general have always been unaware of the concept of “unintended consequences”.

  • SteveThompson

    The discussion on raising the U.S. debt limit is laughable when compared with the outstanding liabilities (debt) of the entitlement programs including Medicare, Medicaid and Social Security. When those liabilities are included in the debt, it could add up to $120 trillion to the total, resulting in a debt-to-GDP ratio of 900 percent.

    Here is an article discussing this looming fiscal nightmare:

    http://viableopposition.blogspot.com/2011/04/hidden-american-100-trillion-debt.html

    • ottovbvs

      I’m more concerned about the ongoing nightmare of Steve Thompson posting alarmist and meaningless spam.

  • valkayec

    Actually, Matt Ygelsais humorously suggested this strategy a month ago, cutting off funds for programs and priorities Republicans favor and for projects in their districts. About the same time someone wrote that Obama has the full authority to order Treasury to continue to sell bonds and make payments: “The validity of the public debt of the United States…shall not be questioned.”

    • Pavonis

      I’ve seen arguments that the entire debt ceiling fight is moot because the 14th Amendment implies it’s unconstitutional. But no has tried to refute these arguments yet. And I have seen no reports that the Administration plans to use the 14th Amendment as a last resort. So what’s going on? Can the Obama administration simply ignore the debt ceiling – and get away with it?

      • ram6968

        the debt ceiling is “statutory law”….our debt is now “global”…..making it a matter of national security……hence, the constitution supersedes statutory law…14th amendment, section 4

  • kevin47

    Frum has employed this argument before, that Republicans ought to capitulate to liberal demands, because the failure to do so will accrue power to the executive.

    It has yet to happen, because the executive is subject to the same political incentives as anyone else. And so the question remains as to whether the action in question is politically viable. In this case, I think it is, but it has to be played right (note: “played right” does not mean “persuasive to the left-wing”).