Earlier today, Congressman Greg Walden (R-OR) announced plans to introduce legislation to ban the Treasury from minting high-value platinum coins and using said coins to get around the debt ceiling.
He says he does think that under current law such coins would allow the Treasury to circumvent the debt ceiling, but that he "couldn't believe" it is gaining traction as a serious proposal.
"I'm not a lawyer, so let me start with that. But the gentleman who is promoting it is the top Democrat on the Judiciary Subcommittee on the Constitution," the Congressman told Business Insider in an interview, referring to the idea that has been floated most prominently by Rep. Jerry Nadler.
"I assume that he has studied the legal ability to do this. But clearly if he chairs the Constitution Subcommittee, he's done his research. He's a smart man. And so therefore, I'm taking it at face value that the authority is there to allow the minting of a trillion-dollar coin, and that shouldn't be allowed."
The idea of minting a trillion-dollar coin has picked up as an option that would allow the Treasury to temporarily print money to pay the country's bills and work around the debt ceiling. It has turned into a Twitter campaign (#MintTheCoin), and supporters have created a petition urging the White House to mint it.
Walden took interest in proposing legislation to ban the option because he thought the idea of minting a platinum coin to work around the debt ceiling was a particularly absurd idea that exemplified "the problem of people in Washington not understanding the reality" of the national debt. Walden also thought that if the Treasury did mint the coin, it would lead to a "very inflationary" period.
"The notion that we could mint a trillion-dollar coin ... and all of a sudden, your debt issue is gone — it's so absurd and laughable, except people were being serious," Walden said. "This just has to stop. So that's why we're drafting legislation today."
What Walden is suggesting is not quite the issue — Nadler and others in the media have proposed issuing the coin to continue paying the nation's bills in the case that the debt ceiling is not raised. It is not being floated as an option to rid the U.S. of its debt. There's also some debate over whether it would lead to a period of massive hyperinflation.
Walden didn't get too specific when asked what he would demand from President Barack Obama and other Democrats in order to lift the debt ceiling. But he did say he subscribed to the so-called "Boehner rule" that demands one dollar in spending cuts for every dollar increase in the debt ceiling.
One exchange he said he would not accept: banning the trillion-dollar coin in exchange for a permanent elimination of the debt ceiling so that it would be automatically raised.
"It used to be done automatically without a vote, and that's part of why we have the debt level that we have — Congress could just spend and never be held accountable," Walden said. "Now, we're making Congress and the administration take notice of what their spending habits have done to the country, and that's a good thing in terms of turning this thing around."
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