Tag Archives: President Obama

Rationalization and Obligation, Part V: Differences Are Everything

Posted on October 14, 2013 by Joe Firestone | 13 comments

This is Part V of a six part series replying to a claim by the President at his recent White House News Conference. Part I covered the News Conference and the first two (the selective default, and the exploding option) of seven options the President might use to try save the US from defaulting in the face of continued deadlock in the Congress on raising the debt limit or repealing the law enabling it in its entirety. Part II discussed Platinum Coin Seigniorage, invoking the 14th amendment to justify continuing to issue conventional Treasury debt instruments, and consols. Part III discussed premium bonds, and Treasury sales of the Government’s material and cultural assets to the Federal Reserve. Part IV, then evaluated all seven options in light of variations among them in likely degree of legal difficulties they might face, and also the likely impact of each on confidence in the bond markets, if used.

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Tagged #PCS, $60 Trillion Coin, 14th Amendment, austerity, bill black, debt ceiling, debt limit, debt limit crisis options, debt-subject-to-the-limit, default, deficit spending, Ezra Klein, great betrayal, High Value Platinum Coin Seigniorage, kabuki, Matt Kevin Drum, MMT, modern money theory, President Obama, public debt

Rationalization and Obligation, Part IV: Differences Among Options

Posted on October 14, 2013 by Joe Firestone | 18 comments

In Part I, Part II, and Part III, I listed and analyzed seven options, analyzed them and also pointed out that the President’s 14th amendment option, actually makes turning to the 14th as a justification for continuing to issue debt beyond the ceiling, a last resort, and also places an obligation on the President to exhaust other available options, whose legality is probable, but not finally determined by the Supreme Court. But, in his recent Press Conference, the President also failed to recognize any differences among the options in relation to his main point: that loss of public confidence caused by legal challenges would affect sales of debt instruments and other options including Platinum Coin Seigniorage (PCS).

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Tagged #PCS, $60 Trillion Coin, 14th Amendment, austerity, bill black, debt ceiling, debt limit, debt limit crisis options, debt-subject-to-the-limit, default, deficit spending, Ezra Klein, great betrayal, High Value Platinum Coin Seigniorage, Kevin Drum, Matt Levine, Matthew Yglesias, MMT, modern money theory, President Obama, public debt, wigwam

Rationalization and Obligation, Part III: Premium Bonds, and Asset Sales

Posted on October 13, 2013 by Joe Firestone | 38 comments

By Joe Firestone

In Part I of this six-part series I presented the President’s explanation of why he can’t use alternative options for coping with the default threat arising out of refusal to raise the debt ceiling, a summary of the kinds of difficulties characterizing it, and discussed two of seven options, selective default, and the exploding option, the President has to deal with it, apart from the way he seems to have chosen. In Part II I discussed the next three options, platinum coins, 14th amendment, and consols, and commented on the legal issues related to them. Here, in Part III, I’ll cover two options which have started getting attention most recently.

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Tagged austerity, bill black, debt ceiling, debt limit, debt limit crisis options, debt-subject-to-the-limit, default, deficit spending, great betrayal, Jack Balkin, Kevin Drum, L. Randall Wray, Matt Levine, MMT, modern money theory, President Obama, public debt, warren mosler, wigwam

Rationalization and Obligation, Part II: Coins, the 14th, and Consols

Posted on October 12, 2013 by Joe Firestone | 18 comments

By Joe Firestone

This six-part series is a reply to the President’s glossing over the options open to him apart from playing “chicken” with the Republicans over the debt ceiling. Part I, presented the President’s explanation, a summary of the kinds of difficulties characterizing it, and discussed two of seven options, selective default, and the exploding option, the President has to deal with it, apart from the way he seems to have chosen. Part II will discuss his platinum coin, 14th amendment, and consols.

Platinum Coins, the 14th amendment, and Consols

3. Using the authority of a 1996 law to mint proof platinum coins with arbitrary face values in the trillions of dollars to fill the Treasury General Account (TGA) with enough money to cease issuing debt instruments, and even enough to pay off the existing debt. This option, originating with beowulf (Carlos Mucha)in its Trillion Dollar Coin (TDC) form has gotten a lot of attention. But a variation of it in its High Value Platinum Coin Seigniorage (HVPCS) form, requiring a coin with face value of $60 Trillion for example, has received much less attention, except in my own writing.

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Tagged #PCS, $60 Trillion Coin, 14th Amendment, austerity, bill black, chris cook, debt ceiling, debt limit, debt limit crisis options, debt-subject-to-the-limit, default, deficit spending, grand bargain, great betrayal, High Value Platinum Coin Seigniorage, MMT, modern money theory, President Obama, public debt

Rationalization, Obligation, Part I: No Magic Bullets?

Posted on October 11, 2013 by Joe Firestone | 24 comments

By Joe Firestone

The media and politicians in both parties are still largely echoing the Administration’s framing of the fiscal situation and absolving the President of his share of the blame for the debt limit crisis. They’re reinforcing his message They’re also preparing the way for a compromise, that will, almost certainly, result in hurtful cuts to Government spending including renewed consideration of “the Great Betrayal,” also known as “the Grand Bargain,” including passage of the chained CPI cuts to Social Security over the objections of a large majority of the American people.

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Tagged #PCS, 14th Amendment, austerity, bill black, debt ceiling, debt limit, debt limit crisis options, debt-subject-to-the-limit, default, deficit spending, grand bargain, great betrayal, High Value Platinum Coin Seigniorage, MMT, modern money theory, President Obama, public debt

Stop “the Great Betrayal:” Kabuki Update

Posted on October 4, 2013 by Joe Firestone | 23 comments

It now looks like the big media and leaders in both parties are no longer focusing on the Government Shutdown crisis, but are now moving on to the notion that the shutdown is melding with the upcoming probable breaching of the debt limit to create a combined mother of all fiscal crises. Along with this, the media and many politicians, encouraged by the President’s standing “strong, strong, strong,” are now directing attention away from whether ObamaCare will be delayed or compromised, to other types of ransom the Administration might pay in return for both re-opening the Government and also providing an increase of an undetermined amount in the debt limit. Meanwhile there are reports that under increasing Wall Street pressure John Boehner is preparing to negotiate with House Democrats and allow a vote to pass a CR and a clean debt limit increase bill, in return for concessions he can take back to his caucus.

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Tagged #PCS, $60 Trillion Coin, 14th Amendment, austerity, bill black, debt ceiling, debt limit, debt limit crisis options, debt-subject-to-the-limit, default, deficit spending, Ezra Klein, grand bargain, great betrayal, High Value Platinum Coin Seigniorage, jamie galbraith, kabuki, Mark Patterson, MMT, modern money theory, President Obama, public debt, Richard J. Eskow, WaPo, Yves Smith

Stop the Kabuki: It’s About “the Great Betrayal”

Posted on September 22, 2013 by Joe Firestone | 30 comments

By Joe Firestone

MSNBC continues on with its campaign to cast the Tea Party Republicans in the role of principal villains in the imminent Government budget/ government shutdown crisis and the likely coming debt ceiling crisis. The teabots, you see, are using the Republican majority in the House to demand more austerity in government and defunding of the Affordable Care Act (ACA). They’re using their bloc of votes in the House, along with the Hastert rule requiring a majority of the majority Republican caucus to veto any possible compromise vote of the whole House on a budget or a continuing resolution that would get bipartisan majority support keeping the government open past October 1.

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Tagged #PCS, $60 Trillion Coin, 14th Amendment, austerity, bill black, debt ceiling, debt limit, debt limit crisis options, debt-subject-to-the-limit, default, deficit spending, grand bargain, great betrayal, High Value Platinum Coin Seigniorage, kabuki, MMT, modern money theory, President Obama, public debt, Yves Smith

Ezra Is Terrified Because of His Framing

Posted on September 18, 2013 by Joe Firestone | 52 comments

Here’s an exchange from last Friday’s Chris Hayes “All In” MSNBC show among Chris, Robert Costa of the National Review, and Ezra Klein of The Washington Post’s “Wonkblog.” In what follows I’ve slightly edited the MSNBC transcript to get rid of obvious verbal deviations but haven’t corrected for punctuation.

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Tagged #PCS, $60 Trillion Coin, debt ceiling, debt limit, debt-subject-to-the-limit, default, deficit spending, Government shutdown, High Value Platinum Coin Seigniorage, MMT, modern money theory, President Obama, public debt

Do the Democrats Really Want to Bear the Blame for a Crash that Wall Street Will Cause?

Posted on September 14, 2013 by Joe Firestone | 41 comments

By Joe Firestone

This post by Lynn Parramore makes the point that the next crash is coming and probably will be blamed on the Democrats. It’s a great point, but it needs to be pursued further.

What if we have another Republican sweep in 2014, like 2010, but worse? Then we’re going to have more policies that increase inequality. Even less regulation, causing even more domination of our politics by corporations and the financial sector.

We’ll have more military spending and more wars, along with more shredding and privatization of the social safety net. We’ll have even less environmental regulation, and even more global warming; more drill baby drill, and less and less of public education. At the State level, we’ll have more of the war on women, blacks, seniors, and hispanics; more corruption from corporations and the rich giving “gifts” to officeholders; more voter suppression, even more police brutality and denial of first amendment rights, more religion in our schools accompanied by more guns everywhere, and more Scalias, Alitos, Thomases, and Robertses subjugating everyone to corporations.

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Tagged #PCS, $60 Trillion Coin, debt ceiling, debt limit, debt-subject-to-the-limit, deficit spending, High Value Platinum Coin Seigniorage, MMT, modern money theory, President Obama, public debt

Declaring the Grand Bargain Dead Is Premature

Posted on August 31, 2013 by Joe Firestone | 34 comments

By Joe Firestone

Stories in The Washington Post and the New York Times have some in the blogosphere proclaiming that it’s time to celebrate the death of the Grand Bargain, and others at least raising a question about its death. I’ll go on record as saying that celebrating its death is definitely premature.

It is so because we’ve yet to go through the budget or continuing resolution-passing activities coming up in September, and also have yet to go through the debt ceiling conflict to come in October. Mainstream Washington commentators believe John Boehner is determined to avoid a government shutdown crisis of the budget/CR conflict and that one or the other will be passed before October 1. Assuming they’re right, that still leaves the matter of the debt ceiling “crisis,” which the same commentators are saying will happen because Boehner has to promise his tea party caucus a chance to coerce the Administration, if he’s going to get their acquiescence on the budget/government shutdown matter.

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