January 10, 2013 Leave a comment
Paul Krugman and Matt Yglesias have been pushing the $ trillion dollar platinum coin solution to the debt ceiling debate. Ezra and Drum have been saying it’s a horrible idea. Meanwhile, the fact that Republicans are just so amazingly stupid about it, makes me like it more. Oh, the cognitive dissonance. I’m pretty sure Ezra won me over to his side with a terrific post today, though:
The argument against minting the platinum coin is simply this: It makes it harder to solve the actual problem facing our country. That problem is not the debt ceiling, per se, though it manifests itself most dangerously through the debt ceiling. It’s a Republican Party that has grown extreme enough to persuade itself that stratagems like threatening default are reasonable. It’s that our two-party political system breaks down when one of the two parties comes unmoored. Minting the coin doesn’t so much solve that problem as surrender to it.
The platinum coin is an attempt to delay a reckoning that we unfortunately need to have. It takes a debate that will properly focus on the GOP’s reckless threat to force the United States into default and refocuses it on a seemingly absurd power grab by the executive branch. It is of no solace that many of the intuitive arguments against the platinum coin can be calmly rebutted. It’s the wrong debate to be having.
Worse, it is a debate that will that will strengthen the worst factions in the Republican Party. There are plenty of Republicans who are privately uncomfortable with the party’s shift towards repetitive brinksmanship. Some of them are quite powerful. Recall that in 2011, Senate Minority Leader Mitch McConnell basically tried to trick his party into giving up its power over the debt ceiling. Just last weekend, Newt Gingrich said the debt ceiling is “a dead loser” for the GOP and advised Republicans to find “a totally new strategy.” Philip Klein, a columnist at the Washington Examiner, put it clearly: “As a conservative, I fear Republicans overplaying their hand, delaying a debt limit increase so long that financial markets begin to panic. As a result, small government ideology will be associated in the public mind with economic chaos and conservatism will be seen as incompatible with governance.”
The fact is that after losing the 2012 election, and with the business community mobilizing against the threat of default, the leadership of the Republican Party is going to have a terrible time holding its members together on the debt ceiling. Even more problematic, from the perspective of conservative hard-liners, is that many of the GOP’s leaders are themselves scared of the debt ceiling and looking for a way out. There is a very good chance that this fight can be won and these tactics discredited.
The moment the White House declares itself open to minting the coin, the Republican Party’s extremists can breathe a sigh of relief. They may not have been able to hold the line for a strategy that sought unpopular Medicare cuts by threatening a disastrous default. But they can certainly hold the line against what will, among their members, be seen as a wild, unprecedented, inflationary power grab by an overreaching president. Making matters more difficult, it will become impossible for more cautious Republicans to break ranks. It’s one thing to argue, as many are already doing, that inducing default risks destroying the Republican Party for a generation. It’s another to abet such a blatantly unconstitutional, dangerous move from the executive branch. As Klein writes, “if Obama were to listen to liberals and go the coin route instead, it would be tossing a life preserver to Republicans.”
So, that convinced me. I don’t think Obama was ever going to do this, but it now seems pretty clear to me he shouldn’t. I just hope he continues to stay strong and utterly refuses to negotiate on the issue.