The Treasury Department will not mint a trillion-dollar platinum coin to get around the debt ceiling. If they did, the Federal Reserve would not accept it.
That’s the bottom line of the statement that Anthony Coley, a spokesman for the Treasury Department, gave me today. ”Neither the Treasury Department nor the Federal Reserve believes that the law can or should be used to facilitate the production of platinum coins for the purpose of avoiding an increase in the debt limit,” he said.
So long, and thanks for all the fish.
Update (by SH): More Krugman.
If I’d spent the past five years living in a monastery or something, I would take the Treasury Department’s declaration that the coin option is out as a sign that there’s some other plan ready to go. Maybe 14th Amendment, maybe moral obligation coupons or some other form of scrip, something.
And maybe there is a plan.
But as we all know, the last debt ceiling confrontation crept up on the White House because Obama refused to believe that Republicans would actually threaten to provoke default. Is the WH being realistic this time, or does it still rely on the sanity of crazies?
…As I said, if we didn’t have some history here I might be confident that the administration knows what it’s doing. But we do have that history, and you have to fear the worst.
Meanwhile I’m seeing tweets like this from Dem stalwarts:
That’s how it should be. RT @theplumlinegs: Nixing of coin presents GOP with stark choice: Compromise, or be seen destroying US economy.
— Kevin Drum (@kdrum) January 12, 2013
Which rather smacks of Democrats playing their own game of chicken with the national economy for their own political gain, to me. In fact, it sounds very like the Dem plan, from people who all earn more than the national average, is something along the lines of “The Republicans will blink first but even if they don’t and the economy tanks all the poor people who will get even poorer will blame them and vote for us, so where’s the downside?”