The debt ceiling, created under the Second Liberty Bond Act of 1917, sets the maximum amount of money that the United States can borrow. Some constitutional scholars argue that Section 4 of the 14th Amendment to the U.S. Constitution, known as the Public Debt Clause, allows the president to authorize the Treasury Department to borrow without regard for the debt ceiling in order to pay the debt Congress has authorized. Others claim that Article 1, Section 8, which gives Congress the power to “...pay the Debts...,” supersedes Section 4.

Neither argument has been tested in the courts, leaving the question open until a U.S. president attempts to invoke the 14th Amendment to circumvent Congress and prevent what nearly everyone agrees would be a constitutional crisis should the U.S. default on its debt.

Historical Context

Following the Civil War, Congress submitted three proposed constitutional amendments (13, 14, and 15) to the states as part of the Reconstruction program. Known as the Reconstruction Amendments, they were designed to guarantee equal civil and legal rights to Black Americans.

Following ratification by the legislatures in 28 of 37 states, the 14th Amendment, known as the Equal Protection Amendment, was declared legal by then-Secretary of State William Seward on July 28, 1868. The primary purpose of this amendment was to extend the rights granted under the Bill of Rights, including citizenship at birth, to former slaves.

Section 4, which speaks to the validity of the public debt, was inspired by a desire to ensure that government obligations enacted as a result of the Civil War, including pensions to veterans, would be honored. However, the broader intent of the language to cover future debt has also long been accepted.

However, the subject of much debate is how the executive branch can use Section 4 to override Article 1, Section 8 of the Constitution, which gives Congress the power to pay public debt.

The 14th Amendment and the Debt Ceiling

The argument that the president (executive branch) has the power to authorize the Treasury Department to borrow to pay🔥 public debt depends on how broadly Sec🅷tion 4 is interpreted, especially about the original intent of the legislators who drew up the language of the 14th Amendment.

Stuart McCommas, in the Virginia Law Review on Sept. 24, 2013, stated, “The original public meaning of the phrase ‘[t]he validity of the public debt...shall not be questioned’ in the Public Debt Clause was narrow. The phrase was understood at the time of ratification to be technical language prohibiting direct governmental debt repudiation only.”

McCommas’s argument is that Section 4 prohibits the federal government from taking any action to repudiate or refuse to acknowledge public debt. It does not, McCommas argues, prevent the government from taking action (such as establishing a debt ceiling) that “merely jeopardizes the validity of the public debt.”

McCommas’s paper was published in response to one by Michael Abramowicz at The George Washington University Law School on June 29, 2011. In “Train Wrecks, Budget Deficits, and the Entitlements Explosion: Exploring the Implications of the Fourteenth Amendment’s Public Debt Clause,” Abramowicz made a broad interpretation argument that declared the debt ceiling unconstitutional.

Abramowicz argued that the Public Debt Clause was not merely a prohibition on the repudiation of public debt but a promise that Congress would pay its debts. As a result, he said, not only would the failure to make debt payments during a budget impasse be unconstitutional, but the debt ceiling statute that made the impasse possible would also be invalid.

Legal Interpretations and Court Cases

While no court has ruled specifically on a potential default by the United States on its debt obligations, other rul🥀ings have touched on the subject in important ways.

Branch v. Haas (1883)

In Branch v. Haas (1883), a federal court ruled that although Confederate debt would not be enforced, contracts that involved Confederate currency were enforceable since those who were required to accept them during the Civil War had no other choice. T💎his decision suggests that there may be times when a government cannot simply declare a currency (debt instrument) invalid t🅰o avoid payment of that debt.

Lynch v. United States (1934)

In Lynch v. United States (1934), the U.S. Supreme Court held that when the United States enters into a contract (debt), that contract is governed by the law applicable to contracts between private individuals. It further states that “Congress is without power to reduce expenditures by repudiating and abrogating the contractual obligations of the United States.”

The Gold Clause Cases (1935)

The issue of the repudiation of the U.S. debt arose one year later in four cases known as the Gold Clause Cases. The cases were Norman v. Baltimore & Ohio Railroad Co., U.S. v. Bankers’ Trust Co., Perry v. U.S., and Nortz v. U.S. In those cases, the Supreme Court held that Congress exceeded its authority by refusing to pay bonds in gold. Controversially, the court also ruled that the debtholders could not recover because the damage was nominal.

Goldberg v. Kelly (1970)

In Goldberg v. Kelly, the Supreme Court held that welfare recipients have a right to an evidentiary hearing before their benefits can be terminated. This decision established due process protections for people receiving government assistance, per the 14th Amendment. In this case, the government’s interest in preserving funds through repudiation does not supersede the rights of welfare recipients to due process.

The 14t💦h Amendment and Current Debt Ceiling Debateꦇs

The current status of the statutory limit on the debt ceiling was “suspended until Jan. 1, 2025.”

In 2025, the suspension expired—as the 2017 tax cuts will, resulting in tax increases in most households, says Howard Gleckman, senior fellow at the Tax Policy Center. “[I]nstead of lawmakers looking at tax hikes to slow the growth in the national debt, they’ll likely be trying to stave them off,” he wrote.

This brings everything to a head again, including questions about the constitutionality of the debt ceiling and what happens if the country defaults. On Jan. 21, 2025, 澳洲幸运5官方开奖结果体彩网:the government exceeded the limit and instituted "extraordinary measures" to pay its bills. Janet Yellen did not estimat🌌e how much time 🃏those measures buy.

According to the Committee for a Responsible Federal Budget, “There is no plausible set of changes that could generate the instant surplus necessary to avoid having to raise or suspend the debt ceiling indefinitely.” In other words, despite a temporary suspension of the ceiling, U.S. debt will continue to grow, and the debt ceiling debate will quickly become tense after the suspension is lifted. Depending on how the discussions go, this could put even more pressure on the president to finally test the 14th Amendment in the courts.

If that happens, many observers believe that acting alone could provoke a constitutional crisis as the country awaits a Supreme Court decision—assuming that the high court even agrees to take on the issue. Some experts believe the court will see this as a political issue that needs to be worked out by legislators.

Many experts expect the constitutional questions raised to remain unanswered after 2025, as Congress and the executive branch continue to battle it out.

The Bottom Line

Absent an attempt by the executive branch to override a d🐓ebt limit and spark an ensuing court test, the arguments presented above are just that. Cases can and have been mad🅰e for both a narrow and a broad interpretation of the Public Debt Clause contained in the 14th Amendment.

Should litigation occur, some constitutional scholars believe the court should interpret the Public Debt Clause using the theory of originalism, meaning they should attribute to the words of the Puꦅblic Debt Clause the meaning that those words had at the time of enactment.

Other scholars, including Francis Newton Thorpe, author of “The Constitutional History of the United States,” believe historical context is critical. In 1901, Thorpe wrote, “repudiation, or diminution in value, or any distrust of its [the national debt] obligation, would affect most disastrously the lives and fortunes of the Northern people and would injure our national credit abroad.”