In the aftermath of the Republicans’ retaking of the Senate in last month’s mid-term elections, leaders of the party in both houses of Congress have vowed that they will “govern responsibly.” In particular, they have promised repeatedly that they will not replay the budgetary brinksmanship that has plagued the country since the Republicans took control of the House four years ago.
At the same time, Republicans are struggling to control the impulse among their most extreme members, who would love nothing better than to impeach the President. Controlling those extremists has become especially difficult, because the President has inflamed the Republican base with his executive order to prioritize prosecutions of immigration cases in a way that all but eliminates the threat of deportation for five million immigrants who are currently living in the United States.
The theme that unites the partisans on the right is that the President is “shredding the Constitution,” ignoring his responsibility to enforce all the laws, not only the ones that he happens to like. It is true, of course, that the separation of powers is as fundamental a principle as one could find in the Constitution, but it is also obvious that Republicans’ objections to supposed presidential overreach are utterly situational. What they loved under George W. Bush they hate under Barack Obama (even though most of the latter’s supposed overreach is a mere shadow of the former’s).
Even so, the constant repetition of the idea that President Obama is selectively enforcing the laws potentially implicates some budgetary choices that will soon be facing the country. The problem is that the Republicans’ strategy could make it impossible for the President not to violate one law or the other, as I will explain below. This, in turn, will make it tempting indeed for Republicans finally to impeach the man whom they hate so much.
If the Republicans do succeed in creating a situation in which the President will necessarily commit one or another constitutional violation, this will raise a further delicate situation for Republicans. Their commitment to prove that they can govern responsibly has been accompanied by efforts among the party’s leaders to tamp down the desire of the true believers (in Congress and among the public) to impeach the President. Yet they might well make it all but impossible to avoid impeaching Mr. Obama, because they are determined to use the budgeting process to extract further concessions from the President on spending and other priorities.
Spending, Deficits, and Debt: An Economic Non-Problem, But a Political Powder Keg
Currently, the so-called debt ceiling law has been suspended. That is, earlier this year, when the spending and taxing laws implied a necessary increase in federal borrowing, the statutory limit on the federal debt was nearly breached. Rather than (as it has done dozens of times in the last few decades) simply adjust the debt ceiling to accommodate its own spending and taxing decisions, however, Congress simply put the debt ceiling to sleep.
That nap will end on March 15, 2015, at which point the debt ceiling will be reset at the level of debt that exists on that date. From that date forward, the Treasury Department will be forced to use its “extraordinary measures” to prevent the United States from defaulting on its financial obligations for the first time in history. According to some reports, those measures could delay the day of reckoning until as late as August of 2015.
Therefore, unless Congress increases the debt ceiling, or puts it back to sleep—with a full repeal being the only truly responsible choice—we will again face the prospect of a government default sometime in the middle of next year. The omnibus spending law that was just passed over the weekend, along with the existing spending laws on “nondiscretionary items,” combine with the tax laws (including recent tax cuts that further reduce federal revenues going forward) to guarantee that more borrowing will be needed. The difference between revenues and spending will be more than sufficient to require a change in the debt ceiling law.
To be clear, there is nothing wrong with federal borrowing, as a general matter. And in the current situation, the amount of additional federal borrowing going forward is historically low, for at least the next decade. Even in the longer term, the debt level is no longer projected to “explode,” because of the moderation of health care costs. As an economic matter, deficits and debt have become a non-issue.
As a political matter, however, the debt and the deficit are still flash points. Moreover, as I noted above, even though there is nothing about the current path of our borrowing that should raise any alarms, a growing economy (even one that is growing too slowly, as ours is) requires that the dollar amount of debt rise.
This means that, even though there is no good economic reason for Congress’s attentions to be turned to the federal debt and deficits, at some point next year, we will face another moment in which Republicans’ vows to “rein in runaway debt” (as imaginary as that supposed problem is) will crash into the reality that Republicans in Congress have set a political trap for the President.
The Debt Ceiling and the Trilemma’s Return
What happens on the date on which Treasury’s extraordinary measures run out, and the President is faced with what my fellow Verdict columnist Michael Dorf and I have called a “trilemma”? That is, what can the President do, if the law requires him to spend more money than we take in from taxes, and he is prevented by law from borrowing more money?
Professor Dorf and I have argued that the President would then have to choose among nothing but unconstitutional options. He could collect more money in taxes than the law allows, or he could default on spending required by law, or he could issue debt in excess of the debt ceiling. Any of those choices would violate at least one provision of the Constitution, meaning that the President could correctly be deemed to have violated his oath of office.
Our analysis led us to conclude that the President could minimize the constitutional damage by treating the debt ceiling statute as null and void, thus allowing him to borrow the money that would be required to allow him to obey Congress’s orders regarding spending.
No matter whether we are right or wrong, however, it appears that neither Republicans nor Democrats believe that the President would have any choice but to default on some of the nation’s obligations.
Some Republicans argue that the word “default” only applies to failing to pay bondholders, but that is clearly wrong. The country’s spending laws commit the government to pay citizens and businesses specific amounts of money on certain dates. If the President were to obey the debt ceiling by failing to make some of those payments, then we would for the first time become a nation whose government has defaulted on its legal commitments.
The result of failing to increase, suspend, or repeal the debt ceiling would thus be to force the President to violate the Constitution. And even though the conventional wisdom is wrong about which prong of the trilemma the President must choose, in one sense it does not matter, because the Republicans would finally be given the gift for which they have pined for so long: President Obama would have committed what would seem to be a clearly impeachable offense. But will Republicans find that they wish to return the gift?
Again, the Republicans can avoid all of this by simply allowing the debt to rise to the levels that the spending and taxing laws require. That, however, is simply unacceptable to many Republican members of Congress, some of whom have gone so far as to vow that they will never, ever vote to increase the debt ceiling—even though they happily vote to cut taxes and spend money in amounts that require us to borrow more money.
Therefore, it is at least imaginable that Republicans’ commitments regarding the debt ceiling will trump their vows to govern responsibly. What then?
“Picking and Choosing” On Steroids: Budgetary Fundamentalism Puts Republicans In a Corner
As I discussed above, the Republicans broad narrative about the Obama presidency has become a tale of executive overreach. He is accused of “picking and choosing” which laws to enforce, and which to ignore. (Among countless examples of House and Senate Republican leaders repeating this theme, see here, here, here, and here.) The President is accused of being a “dictator,” because he exercises his discretion in ways that Republicans believe exceed his power under the Constitution.
In one sense, this narrative could cut in favor of the President, should he be faced with a trilemma. “Gee,” the President might argue, “I thought these guys hated it when I didn’t enforce the law, and here they are making it impossible for me to do so. Now I have to ‘pick and choose’ between defaulting on our obligations or borrowing more money. Make up your minds, folks!”
Beyond the pure politics of the situation, it is notable that the Republicans’ concern with presidential excess actually resonates strongly with the analysis that Professor Dorf and I have offered.
After all, we have argued from the very beginning that the President is required, when faced with a trilemma, to choose the path that minimizes how much he must override the will of Congress. (We also argue that he must choose the path that is the most easily reversible, but that prong of our analysis is not implicated here.) That means that the President should honor the spending and taxing laws, and set aside the debt ceiling law, when we cannot honor all three.
Why? Consider the spending measure that barely made it through Congress over the weekend. Everyone involved described that law as “less than ideal,” a “compromise,” and so on. In short, it involved a multitude of tradeoffs, some of which angered Republicans, and some of which angered Democrats. Yet the bill passed, because enough members on both sides of the aisle said, in essence, “I don’t like what I gave up to the other side, but that’s more than made up by what I got in return.”
Now suppose that the President ignores the Buchanan-Dorf reasoning and instead begins to default on our legal obligations. As I noted above, some Republicans want him to “pick and choose” for favorable treatment the holders of U.S. Treasury securities, including foreign governments and banks, even if that means failing to pay Americans who are legally owed money by the federal government.
But the ultimate choice would be the President’s. One of the provisions in the new spending bill appropriated more money for various military weapons programs than the White House requested. If the President must pick losers, why would he not say that, because the Pentagon did not even request those weapons, surely they should not be funded? How would Republicans feel then?
The problem is that the Republicans are already on record as saying that the President is a tyrant because he picks and chooses which laws to obey. If he does what they demand, refusing to borrow enough money to meet all of our obligations, he can only do so by picking and choosing who will be paid, and who will not.
Rather than saying, “Well, we gave him no choice but to make these choices,” surely the argument among many Republicans would be, “See, we’ve said all along that he abuses his power. He now refuses to defund the things we hate, and he defaults on the things we like. Tyranny!”
The new wrinkle, therefore, is that the Republicans have spent the last year harping on a political story that all but begs for impeaching the President—especially if he does what they say that he must do. The trilemma, which seemed to be a trap for the President, could trap Republicans instead. Their leaders say that they do not want to tarnish the party with another impeachment battle, yet they may soon create for themselves a situation in which calls for the President’s impeachment would be unstoppable. At that point, the Republicans would suffer, and so would the country.