There Is No Magical Solution to the Debt Ceiling.

Now Stop it.

Every single day I hear about some new magical solution to the debt ceiling problem.

The president can just decide what law to break. Congress has ordered him to spend money and not given him the money to spend. No. He can’t do that. The constitution says he can’t do that. It’s very clear.

The Trillion Dollar Coin? Also probably unconstitutional. The constitution said that they can mint coins, but it’s pretty unclear that they can just do it on a whim… And then give the money to the Federal Reserve. While it is not explicitly prohibited, as the previous dumber option is, it’s pretty much prohibited.

And this new one that I just read. This one is just peachy, and the dumbest one yet. The treasury can just reissue new debt that’s at a higher premium when we pay off the old debt.

Now, where are we going to get the money to do that? That would require us to issue new bonds before we pay off the old ones. Literally, that’s the plan, to breach the debt ceiling for however long it takes to pay off the bonds. And, bond payments aren’t due on regular intervals, with normal amounts. Cash inflows and outflows are “lumpy,” which is the word that’s been making the rounds lately.

To put it succinctly: there is probably no legal way to pretend that our nation isn’t in a state of total political dysfunction.