With American set to hit the debt ceiling again thanks to out-of-control government spending, the Washington Post has suggested a solution for President Obama: mint two platinum coins valued at $1 trillion each. What would this do? According to the Post:
Thanks to an odd loophole in current law, the U.S. Treasury is technically allowed to mint as many coins made of platinum as it wants and can assign them whatever value it pleases.
Under this scenario, the U.S. Mint would produce (say) a pair of trillion-dollar platinum coins. The president orders the coins to be deposited at the Federal Reserve. The Fed then moves this money into Treasury’s accounts. And just like that, Treasury suddenly has an extra $2 trillion to pay off its obligations for the next two years — without needing to issue new debt. The ceiling is no longer an issue.
By exploiting the law, liberals in government can simply end the Constitutional practice of having spending originate in the House of Representatives. Since the US Mint operates as a wing of the executive, Secretary of the Treasury Tim Geithner, who spends most of his time these days trotting around delivering other insane Obama proposals, could order such an action.