Proponents of the coin respond that no one can challenge the platinum coin in court because no one has standing—it would be hard for anyone to show that he or she was injured by the minting of the coin, the standard for bringing a lawsuit. But it is hard to predict when judges will find standing, and if they allow someone into court in this case, then judicial repudiation is more likely than not.
Another more pressing worry for the Obama administration: impeachment. With a majority in the House, Republicans could easily start impeachment proceedings. And while conviction in the Senate is virtually impossible, as Democrats would not join to create the two-thirds majority needed, merely launching the impeachment process would be politically devastating for President Obama, as it was for President Clinton.
The theory for the platinum coin is weak enough to provide the legal basis for impeachment and absurd enough to provide the political basis. The $1 trillion coin would feed fears of an out-of-control president, and it would be a slap in the face of the current Congress—not some previous Congress from long ago—which has refused authority to raise the debt ceiling. While the coin theory does not literally enable the president to increase spending to whatever level he wants, as he still must respect Congress’ power over appropriations, this detail will surely be lost on a public entranced by the idea of a coin worth $1 trillion. And the gimmicky nature of the legal theory behind the coin would suggest a White House that is unscrupulous rather than guided by the spirit of the law. That is why I have argued instead that the president should rely on his emergency powers or on his inherent administrative authority to borrow money, although admittedly there’s a risk of impeachment in these approaches as well.
President Obama shouldn’t take even a low risk of impeachment for the wacky act of minting a $1 trillion coin. Volatile politics and ambiguous law make for a dangerous combination. The proponents of the platinum coin theory may make it harder, moreover, for President Obama to face down the Republicans. His bargaining power lies in the fact that people are likely to blame Republicans if spending is cut. If spending cuts are the president’s only choice, then the pressure increases on his opponents in the House to raise the debt limit. But if amid economic catastrophe people might instead blame President Obama for not minting the magic coin, then he must choose between the risk of that political hit or the risk of impeachment. In which case, Republicans have a stronger hand at the bargaining table.
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