The Looming Debt Ceiling Crisis in the United States: Can Biden Invoke the 14th Amendment to Raise the Debt Limit?
The United States is facing a looming debt ceiling crisis, with the government running out of cash to pay its obligations unless Congress raises or suspends the debt limit. Treasury Secretary Janet Yellen has warned that the country could run out of cash as early as June 1 if President Joe Biden and House Speaker Kevin McCarthy are unable to reach a deal to raise the debt ceiling. The debt ceiling, which currently stands at $31.4tn, has been raised, extended, or revised 78 times since 1960, under both Democrat and Republican presidents.[0]
The impasse in negotiations lies in House Republicans demanding steep spending cuts and a rollback of some of President Biden’s legislative accomplishments in exchange for their votes to raise the debt ceiling, while Biden and Senate Democrats have insisted that they will not negotiate over the debt limit, calling on Congress to pass a clean increase without any strings attached. McCarthy is asking for cuts in government spending, whereas President Joe Biden argues that the debt ceiling should be increased without any strings attached.[1] Adding to this, the sharp uptick in interest rates has been a clear reminder that rising debt levels can be precarious.[1]
Eleven Senate Democrats are requesting that Biden utilize his constitutional power under the 14th Amendment to increase the nation's debt limit without requiring Congressional approval. Some legal scholars argue that Section 4 of the 14th Amendment allows the Treasury Department to keep borrowing money past the debt limit and that it would be unconstitutional for the U.S. to fail to make payments.[2] However, Treasury Secretary Janet Yellen has cast doubt on the idea, saying that it doesn't seem like something that could be appropriately used in these circumstances, given the legal uncertainty around it and the tight time frame the country is on.[3]
Lawmakers who belong to the Democratic party are urging President Joe Biden to utilize his constitutional power under the 14th Amendment to increase the country's debt ceiling without seeking approval from Congress. In the House, 66 members of the Congressional Progressive Caucus called on Biden to choose a solution invoking the 14th Amendment of the Constitution over a bad deal.[3] A few of the lawmakers include Congressional Progressive Caucus Chair Pramila Jayapal, Reps. Ilhan Omar, and Greg Casar.
For the first 97 days, Biden did not negotiate with McCarthy, because McCarthy hadn’t passed a bill.[4] The White House calculated that the Republicans were so split that they would not be able to pass their version of a budget.[4] Then McCarthy made all kinds of deals with the far-right and passed a bill that ties an increase in the debt ceiling to budget cuts of trillions of dollars, about 22% of domestic spending.[4] The White House’s rhetoric early on did sound more intransigent than was feasible given the reality of divided government.[5]
Earlier this month, Biden expressed his contemplation of utilizing the 14th Amendment to bypass the debt ceiling; however, he expressed skepticism on its effectiveness. A group of Senate Democrats are advising Biden to be ready to utilize the 14th Amendment to increase the debt ceiling without needing Congress to pass a law. While MAGA Republicans attempted to hold the country hostage to demands for unfeasible and unpopular cuts, President Biden insisted there would be no negotiations over the debt ceiling. Currently, White House officials are in talks with aides of House Speaker Kevin McCarthy as there is no confirmed increase in the debt ceiling.[5]
With less than two weeks left until the so-called x-date — the date that Treasury Secretary Janet Yellen has marked as the earliest possible time that the U.S. could default if lawmakers do not raise the debt ceiling — it is essential to reach a deal promptly to prevent a market meltdown.[6] “It’s time for Republicans to accept that there is no bipartisan deal to be made solely on their partisan terms,” Biden said.[7] “They have to move as well.[8]
0. “What to Know About the History of the Debt Ceiling” TIME, 18 May. 2023, https://time.com/6281003/debt-ceiling-history
1. “Charting the Rise of America's Debt Ceiling” Visual Capitalist, 17 May. 2023, https://www.visualcapitalist.com/rise-of-americas-debt-ceiling/
2. “Congressional Democrats beg Biden to nullify their existence” The Hill, 20 May. 2023, https://thehill.com/opinion/white-house/4012134-congressional-democrats-beg-biden-to-nullify-their-existence
3. “Debt ceiling: Why is Biden being asked to invoke the 14th Amendment? – POLITICO” POLITICO, 19 May. 2023, https://www.politico.com/news/2023/05/19/14th-amendment-biden-debt-ceiling-00097932
4. ““The Budget Farce”: Robert Kuttner on Why Biden Admin Can't Give In to GOP Demands to Gut Safety Net” Democracy Now!, 17 May. 2023, https://www.democracynow.org/2023/5/17/robert_kuttner_debt_ceiling_biden_budget
5. “Opinion | Biden's debt ceiling negotiation strategy uses good cop, bad cop” The Washington Post, 21 May. 2023, https://www.washingtonpost.com/opinions/2023/05/21/biden-debt-ceiling-negotiation-strategy
6. “Senate Democrat calls potential for debt default a ‘manufactured crisis’” The Hill, 21 May. 2023, https://thehill.com/homenews/senate/4014417-senate-democrat-calls-potential-for-debt-default-a-manufactured-crisis
7. “Biden to Republicans: Abandon ‘Extreme Position’ on Government Spending” Voice of America – VOA News, 21 May. 2023, https://www.voanews.com/a/biden-calls-on-republicans-to-abandon-extreme-position-on-government-spending-/7102566.html
8. “McCarthy says he'll meet with Biden after ‘productive' debt ceiling call” NBC News, 21 May. 2023, https://www.nbcnews.com/politics/congress/mccarthy-says-meet-biden-monday-productive-debt-ceiling-call-rcna85481
