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Author | Topic: United States Debt Default | |||||||||||||||||||||||||||||||||
crashfrog Member (Idle past 1488 days) Posts: 19762 From: Silver Spring, MD Joined: |
Further evidence that this isn't just something goofy I've made up:
quote: That's Jack Balkin, a professor of Constitutional Law at Yale.
http://www.cnn.com/.../07/28/balkin.obama.options/index.html
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crashfrog Member (Idle past 1488 days) Posts: 19762 From: Silver Spring, MD Joined: |
First, there may be other legal obstacles to using these options that we don't know about ... Yes, or there may not be. And even if there is, who would have legal standing to bring the suit?
This plus the fact that the Fed is not required, in its sole discretion, to accept coinage it did not order. The Federal Reserve isn't being asked to accept anything and their cooperation is not required. They're irrelevant to the "Jumbo Coin" stratagem. Coinage is money as soon as it is issued by the Treasury, because it's an obligation of the Treasury, not the Fed. The Fed, as I've explained, has absolutely nothing to do with this. If the Federal Reserve Bank won't accept cash, another bank will. But CS couldn't explain the circumstances under which American banks would boycott the Federal government, and you haven't been able to explain anything at all.
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crashfrog Member (Idle past 1488 days) Posts: 19762 From: Silver Spring, MD Joined: |
The Board of Governors of the Federal Reserve System. On what basis? How will they demonstrate harm or that the Treasury's actions are illegal, given the authority granted to the Treasury by 31.5112(k) and 31.5103? You'll have to do better than just assert that the Board of Governors has any standing in this matter. Why would they? It's Treasury business that doesn't involve them.
This whole idiotic scheme would cause more damage than the problem your tiny little mind thinks it solves. You must have arrived at this conclusion based on your years teaching constitutional law at Yale. Oh, no, wait! That's not you, that's Jack Balkin, who thinks there's no known legal impediment to the "Jumbo Coins" strategem. You, on the other hand, seem to know absolutely nothing. You couldn't even tell the difference between coins and bills.
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crashfrog Member (Idle past 1488 days) Posts: 19762 From: Silver Spring, MD Joined:
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No, just a simple MS Economics. Just enough to be totally wrong, it seems. Well, that explains your complete ignorance of the actual terms of the Federal Reserve Act.
Those who hatch such boneheaded schemes seem not to recognize the power that monetary policy possesses and why it is placed at arms length from the political whims of government. And what about unallotment power? What about the power of the purse? Your idiot scheme - the Treasury opting not to pay some bills - involves the Executive Branch unilaterally seizing authority beyond that granted to it by Congress. If the Treasury is allowed to unallot funding in this context, it'll be the pretense for unallotting funding in the future. Republican president doesn't like abortion? Goodbye funding, Planned Parenthood, regardless of how Congress votes - the new TresSec just won't cut you the check. But that doesn't seem to bother you, even though that's way more important - a much more significant shift in the traditional balance of authority and power - than the Treasury printing money. You know, like it always has.
You can see how your crazy scheme would cause a major expansion in the money supply beyond the present needs of the economy leading to an unacceptable level of monetary and economic inflation, yes? The "present need of the economy", according to economists, is to have about 3 trillion more dollars than it has. That's the shortfall in aggregate demand vs trend, and about double how much cash actually evaporated during the collapse of the housing market in 2008. So, all indications are, we could use a major expansion in the money supply right now. Inflation is less than 3%, it's perverse to worry more about inflation than the government not being able to pay its bills. But I wouldn't expect an MA to understand any of that.
But the Fed does and your st*pid little scheme violently usurps their authority and prerogative in violation of the Federal Reserve Act and (more importantly) in the intent of Congress in placing these rights exclusively with the Federal Reserve Board of Governors. Congress has never intended to place these rights exclusively with the Federal Reserve Board who is, at any rate, an agency of the Executive Branch. So there's hardly a "usurpation" of power, here - merely the Executive Branch executing its Constitutional authority over the printing of money. But your harebrained notion that the Executive Branch can just decide not to pay people, while considerable more popular, really is a usurpation of the power of Congress's budgetary authority with profound implications for the country going forward. And if you weren't out of your mind with a personal vendetta against me, you'd be able to see that. "Jumbo coins" really is the best option for the nation. I hope somebody on the President's staff is working on it; based on Boehner's failed attempt to pass a bill last night, I'm a lot less optimistic that this situation will be resolved in time.
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crashfrog Member (Idle past 1488 days) Posts: 19762 From: Silver Spring, MD Joined: |
Why do you think that it hasn't been done? Because the Federal Reserve Board is supposed to handle this. Did you know that two positions on it are unfilled? That's right, one of the most important monetary organizations in the country is understaffed, because Republicans have been blocking all of the President's nominees. Funny, isn't it? How they've deliberately neutered the organization that could normally see us through this recession with Keynesian measures? And now they've engineered this debt crisis to boot?
I still don't think a bank would take the coin because its defeating the purpose of the Federal Reserve. Who cares? More specifically why would a bank care if the Treasury does an end-run around the Fed just this once to save the country? You're still not explaining the circumstances by which a complete bank boycott of the Federal government is engineered.
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crashfrog Member (Idle past 1488 days) Posts: 19762 From: Silver Spring, MD Joined: |
You said the Fed Res was irrelevant and they could just take it any bank. Why hasn't that happened? Has it ever happend at all? Well, there's a lot of laws so it's easy to not be aware that the Treasury can do this. I mean, look at AZPaul. And even if they knew that they could do this over at the Treasury, maybe they felt that it abrogated Congress's intent to do so. And what was the need to do it? The debt ceiling/Federal Reserve Bank system was working just fine until literally two months ago when this one-of-a-kind hostage crisis started. I don't find it very significant that it was never done before, because the need to have done it was never present until now.
Who would want to be the guy that help them go around the feds? The Federal Reserve Bank isn't the mafia.
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crashfrog Member (Idle past 1488 days) Posts: 19762 From: Silver Spring, MD Joined: |
Can any of the economic savvy members with a more objective outlook on this disagreement than either Crash or AZPaul on this topic shed any light? The expertise of political scientists and economists at Harvard and Yale was insufficient, somehow?
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crashfrog Member (Idle past 1488 days) Posts: 19762 From: Silver Spring, MD Joined: |
Jon, lately I've been sensing a bit of a sea change in your political views.
Is that something you would like to comment on?
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crashfrog Member (Idle past 1488 days) Posts: 19762 From: Silver Spring, MD Joined: |
Here's the text of Congresswoman Rashida Talib's "Automatic BOOST to Communities Act":
IV. Funding the Program a. This Automatic BOOST to Communities Act would be a money-financed fiscal program for which no additional U.S. debt would be issued. b. Instead, the program would be funded directly from the Treasury, using its legal authority to create money via coin seigniorage, which is a statutory delegation of Congress’s constitutional power of the purse. c. The mechanics of this funding approach would be as follows: The Treasury Secretary would direct the U.S. Mint to issue two $1 trillion platinum coins, under the legal authority provided by 31 U.S.C. 5112(k). Congress would direct the Federal Reserve to purchase the newly issued coins at full face value. The Federal Reserve would complete the purchase by crediting the U.S. Mint’s account at the Fed with $2 trillion in reserves. The Fed would retain ownership over the two $1 trillion coins permanently in order to ensure its own balance sheet remains fully capitalized by the Treasury. No webpage found at provided URL: https://tlaib.house.gov/sites/tlaib.house.gov/files/Automatic%20Boost%20to%20Communities%20Act%20.pdf Hope you're all doing OK with regards to COVID-19, I know the readership here skews a little to the older side. Take it seriously, stay in, and wash your hands. Evolution is real and this time it's gunning for you.
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crashfrog Member (Idle past 1488 days) Posts: 19762 From: Silver Spring, MD Joined: |
We've already bred. It does take a particular brand of species-centrism to think I was talking about the evolution of humans.
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crashfrog Member (Idle past 1488 days) Posts: 19762 From: Silver Spring, MD Joined: |
Good to know you remain as insensitive to new evidence as ever.
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