Editor’s note: Dean Obeidallah, a former attorney, is the host of SiriusXM radio’s daily program “The Dean Obeidallah Show.” Follow him @DeanObeidallah@masto.ai. The opinions expressed in this commentary are his own. Read more opinion at CNN.
Speaking at the G7 Summit in Hiroshima, Japan on Sunday, President Joe Biden sounded the alarm that the United States may for the first time ever default on our nation’s debt.
The President pointed a finger directly at GOP House negotiators over their “extreme” demands, warning, “I can’t guarantee that they wouldn’t force a default by doing something outrageous.”
Biden directly blamed acolytes of former President Donald Trump, stating: “I think there are some MAGA Republicans in the House who know the damage it would do to the economy, and because I am president, and a president is responsible for everything, Biden would take the blame and that’s the one way to make sure Biden’s not reelected.”
The remarks were a far cry from the President’s upbeat comments earlier in the week when he declared, “I’m confident that we will get an agreement on the budget” and added that GOP negotiators were acting in “good faith.”
I’m afraid that the brutal truth is that MAGA adherents in the House GOP are working to tank the economy, because they believe it will help Republicans win back the White House in 2024 – even if it leads to an economic catastrophe.
President Biden must ensure our nation doesn’t go into default—which Treasury Secretary Janet Yellen says could happen by June 1. It’s a matter of growing urgency. “Every family should be concerned” about a possible default, Rohit Chopra, director of the Consumer Financial Protection Bureau, told CNN last week in an interview.
Meanwhile, a Moody’s Analytics report in March found that a debt ceiling breach of even one week would lead to the loss of 1.5 million jobs, raising the unemployment rate from 3.4 percent to 5 percent—with working class Americans bearing the brunt of those job losses. Interest rates would spike on credit cards, car loans and mortgages, while worldwide stock markets are expected to crash.
Yet Donald Trump recently urged the House GOP to let the country go into default if Biden doesn’t given in to all their demands, even though an overwhelming percentage of Americans disagree.
An April CBS poll that found 70 percent of Americans support raising the debt ceiling to avoid a default, likely because they understand the economic pain we would all feel if no deal is made.
That’s why President Biden should immediately invoke Section 4 of the 14th Amendment to allow the Treasury Department to borrow to pay nation’s outstanding debts—while still continuing talks with GOP leaders.
This provision of the Constitution—enacted after the Civil War to ensure that the Confederate states rejoining the United States could not block payment of the war debts incurred by the Union in the war—provides that, “The validity of the public debt of the United States, authorized by law…shall not be questioned.”
On Sunday, Biden remarked that “I think we have the authority” to utilize the 14th Amendment. He signaled, however that the move could face legal challenges. “The question is, could it be done and invoked in time that it could not – would not be appealed?” he said.
While various constitutional scholars believe the President does have such power, litigation seems likely if he invokes the 14th Amendment. Texas GOP Senator Ted Cruz criticized the President, saying “I think Biden’s position on the 14th amendment is legally frivolous.” McCarthy said Sunday, “The president keeps changing positions every time Bernie Sanders has a press conference. He gets reactive and he shifts.” Biden and McCarthy spoke by phone yesterday and are due to meet Monday.
The President should invoke the 14th Amendment now – well before the June 1 default deadline. Let the issue head to the courts while at the same time making it clear to the country – and the world – that he will use every tool available to ensure that the United States will not default on its debts. And while this is playing out in the courts, Biden can still negotiate with the House GOP to reach a broader budget deal.
My hope would be that any such deal will include language that will end once and for all the archaic procedure of annually raising the debt ceiling—a concept originally created by Congress in 1917.
The impact of this law is that while Congress votes to spend money, lawmakers must vote again later to raise the debt ceiling to pay for what they’ve already spent. When Congress authorizes spending, common sense dictates that the debt must be honored without conditions.
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Yet, the House GOP is currently agreeing to honor America’s financial obligations only if Biden agrees to their wish list of right-wing agenda items. These Republican demands range from ending clean-energy incentives contained in the Inflation Reduction Act to reversing Biden’s cancellation of student loan debt to massive cuts in domestic programs.
Their demands are akin to buying a new refrigerator, taking it home and using it and then later telling the credit card company that you won’t pay the bill unless they agree to new conditions.
By invoking the 14th Amendment now—regardless of the ultimate court decision—President Biden would show bold leadership. He’d demonstrate that he’s willing to protect American jobs and safeguard our economy, which currently boasts the lowest unemployment rate since 1969 and the lowest Black unemployment rate ever.
Let Republicans file a lawsuit seeking to drive the United States into a default to destroy that. I’m confident that, come 2024, it will only give voters another reason to reject the GOP.
