- White House Press Secretary Jen Psaki ruled out printing a coin to raise the debt limit.
- Democrats are struggling to find a way to raise the bar without GOP support.
- An increasing number of proponents say that printing a $ 1 billion platinum coin would avoid party political clashes.
Republicans have blocked any attempt by Democrats to raise the debt limit before the government defaults on its debt, and White House Press Secretary Jen Psaki just ruled out a $ 1 billion trillion as a potential solution.
“We are, of course, looking at a number of options, and none of these options were viable, not even because they would not be accepted by
, under the guidance of our finance minister or just by legal restrictions, “Psaki said during a news conference on Monday, referring to the minting of a coin to raise the debt limit. Psaki did not say what legal restrictions she was referring to.
“It requires Congress to act,” she added. “That’s the only way forward.”
The idea of minting a coin is gaining momentum inside and outside Congress.
It refers to legislative language about the types of coins that can be legally minted in the United States, and states that the Treasury Department can print a $ 1 billion trillion, deposit it in the Federal Reserve, and then continue to pay its bills as usual. It would allow Congress to dodge the “debt ceiling,” as rep. Bill Foster of Illinois told Insider that it’s a silly rule we make up ourselves. The rule requires Congress to vote to raise the debt ceiling each time the United States reaches its borrowing limit.
Democrats like Michigan Rep.Rashida Tlaib and New York Rep.Jerry Nadler support the minting of the coin because it would avoid party struggles that put the United States at risk of a default that could have catastrophic consequences for the economy. Nobel Prize-winning economist Paul Krugman just approved it in his New York Times column.
But since Psaki rules out the possibility of hitting a coin soon, Democrats will likely have to fight to find another way to raise the debt limit in a short timeline.
Finance Minister Janet Yellen told Congress last month that they have until October 18 before the United States goes into default on its debt and Democrats are struggling to find a solution to prevent a default on their own.
Senator Minority Leader Mitch McConnell blocked the bill passed by the House Democrats last month that would have averted both a debt standard and a government shutdown, and Democrats plan to vote on another bill on Monday that will suspend the debt ceiling – something the GOP is likely to beat down, as well.
McConnell wrote in a letter to President Joe Biden on Monday that Democrats are “sleepwalking” toward a debt default, and he remained firm in raising the limit for anything Democrats must do on their own through budget voting.
“Bipartisanship is not a light switch that speaks Pelosi and Leader Schumer can turn around to borrow money and turn away to use it,” McConnell wrote. “The Republican position is simple. We have no list of demands. For two and a half months, we have simply warned that since your party wants to govern alone, it must also meet the debt limit alone.”
But Biden said in Monday’s remarks that using reconciliation – a tactic that allows Democrats to pass legislation without Republican support – would be “an incredibly complicated and cumbersome process.”
“Republicans not only refuse to do their job, but they threaten to use their power to prevent us from doing our job – and save the economy from a catastrophic event,” Biden said. “I honestly think it’s hypocritical, dangerous and shameful.”
However, the bite will still not mint the coin in response.