Could a $1 Trillion Coin Help the U.S. Avoid a Debt-Ceiling Showdown?

President Obama could order a special coin to help cover the debt if Congress won't cooperate, say supporters of an idea that's gaining traction

"Need a $1 trillion coin, take a $1 trillion coin." There's a message you won't see on jars near cash registers in stores. But some pundits and lawmakers are saying that President Obama should do just that.

If Republicans in Congress threaten to let America default in the upcoming debt-ceiling and spending cut negotiations, Obama could order up a massive coin to deposit in the Federal Reserve to help cover the debt. An obscure commemorative coin law gives the Treasury Secretary the power to mint and issue platinum coins in any denomination.

It may sound like a wacky idea, but it's gaining traction with backers including Nobel Prize-winning economist Paul Krugman, who wrote a column called "Be Ready to Mint That Coin," in Monday's New York Times, and U.S. Rep. Jerrold Nadler, D-N.Y.

"Given the realities of our political situation, and in particular the mixture of ruthlessness and craziness that now characterizes House Republicans, it's just ridiculous - far more ridiculous than the notion of the coin," Krugman wrote. And which person's face should be on that coin? House Speaker John Boehner, Krugman suggests.

In response, U.S. Rep. Greg Walden, R-Ore., has introduced a bill to ban the president from minting the coins, saying the idea is "absurd and dangerous, and would be laughable if the proponents weren't so serious about it as a solution," Politico reported.

Via the New York Times and Politico and the Wall Street Journal.

Would minting a $1 trillion dollar platinum coin help solve the debt-ceiling crisis?

[PNWest]

It is probably constitutional but is not the right way to solve the problem.

[martydotcom]

Here's reality if we default I'll take the coin

The Economist. "A major US default would send a sequence of gigantic hits through the financial system. Cash won’t be there. Balances will turn into fiction. Big money shortfalls will cascade through the markets. Banks will crash like 1929 and 2008 were just kindergarten recitals.
Result- Global crash, and a big one, if it turns into a rout. Remember that panic is the only working behavioural pattern in this environment.
The safe havens may also collapse in a really bad crash:
Even the 1% may find themselves effectively worthless. What value is an asset nobody can buy? Only what can be paid for it.
Gold prices can also crash. Lack of money means lack of ability to buy."

Tea Party types you think holding The Republic hostage is a good idea? I guess if you're a penny less slug living 100% off the grid you're immune. Prepers, be prepared for about 8 years followed by more government spending as in the New Deal. Guess the plan to force a defaul has tons of unintended consequence - far too complex for the bitter little bigots of the Tea Party to anticipate ( they hate the N.E. too)

[PNWest]

@martydotcom I think the ultra-rich have just about had it with the baggers. They know damn well that if the GOP causes a gov't shutdown that they'll be the ones hit hardest. I don't think they'll allow the GOP to do it. I think they would love to see Obama mint a trillion dollar coin so they could keep blaming him but I doubt that it will happen. I expect the GOP to huff and puff and act outraged, Obama to make a few spending cuts, and then the GOP folds like a cheap lawnchair followed by more hollow threats from the baggers.

[martydotcom]

@PNWest Just fed up with how dumb they and the their idiotic followers are. They, as a political party, are a glaring demonstration of the failures of our educational system.
ie Koch anti EPA campaign wonder why Koch's want EPA eliminated?? Think any baggers care if their kids are being poisoned ? Apparently not

http://www.polluterwatch.com/koch-industries

[MongoAPillager]

Great idea,Hey lets mint a couple,lets send a couple to China and ask for Change back

[MongoAPillager]

obviously the white house has lost the drug war in its cabinet

[woodtick57]

@MongoAPillager

Is it the White house proposing this idea?

[MongoAPillager]

@woodtick57 yep,the prez ran it by me a couple of days ago

[MongoAPillager]

@woodtick57 he won the election so it,s his baby by default just like hurricane sandy was caused by G W B

[artjeb]

A very brilliant idea mongo. I would love to see that happen. lol

[mimi57]

Sounds great! We'll only need about seventeen of them and we'll be all good...
Problem solved. how simple is that?... lmbo

[Mogal]

What planet do the people that think crap up like this come from?

[mimi57]

The same one that got us into this mess...I'm all for it, I like simplicity! LOL

[Mogal]

@mimi57 -Simplicity is one thing, obtuseness, another.

[mimi57]

@Mogal Well, the obtuseness ain't leaving anytime soon, that's for sure! This country is filled to the brim with obtuseness...

[Mogal]

@mimi57 -It certainly seems to be an equal opportunity affliction...

[mimi57]

@Mogal Yep and pretty crazy...

[twinertia]

A worthless token (pun intended) gesture.

[martydotcom]

The coin Eh? It's a stupid, but benign threat to put the the Tea Party twits in the house back into their asylum
Defaulting on our debt is sheer insanity hence the asylum reference

[armed_liberal]

George W. spent a roll of those coins!

[AceLuby]

Congress cannot deny the US from paying it's debt as it is unconstitutional. In fact, the whole idea of a 'debt ceiling' is unconstitutional according to the 14th amendment.

[PNWest]

A lot of folks around here think the constitution only has one amendment - the 2nd. And they don't consider the part about "A well regulated militia being necessary to the security of a free state" to matter either.

[AceLuby]

@PNWest Don't forget the 1st... gotta have that religious protection and the ability to give unlimited amounts of money to candidates as 'free' speech. After that though it seems to get fuzzy for most people.

[PNWest]

@AceLuby Youa re correct. I forgot about the GOP 1st amendment that grants freedom of religion for Christians and freedom of speech for corporations.

[Cheenoguy]

@AceLuby
Actually they only believe in religious protection for Christians.

[Phreakwars]

Let's mint one, and put Reagan's picture on it. his idealism is what ran up the debts in the first place.

[woodtick57]

Wish they'd go back to selling the presidential $1 coins on credit cards with free shipping.. lots of free flyer miles to be had there...

[Sharpshooter]

One simple question trumps the entire concept.... Who is going to BUY the coin?

The Axelshaft/Jarrett Junta completely lacks understanding of economics. Minting a trillion dollar coin exemplifies INFLATION.

The second those people mint the coin, every dollar in circulation is worth about 10% less. There are about $10.9 Trillion Dollars in circulation today, creating a coin worth about 10% of that number will be disastrous.

The White House Puppeteer, Valerie Jarret's father wanted to bring down the United States; as Svengali to Michele and the puppet it looks like she might just accomplish his mission.

[mimi57]

You're over thinking this...you have to learn simplicity. See, they're all simple and it's
really the only way to go...simplicity. I love it! LOL

[artjeb]

So a trillion coin is going to pay our debt ?? What is behind it ? We still are in debt. You cannot get out of debt by digging the hole of red deeper. Unless we have collaterol to back it it is worth NOTHING

[mimi57]

Yep, is it starting to make sense now?..

[Phreakwars]

Something has to pay our debts. The deadbeat Republicans sure don't want to.

[PoliticalSpice]

@mimi57 Well if the coin or coins added upto the same amount of platinum that had that dollar value then the coins would back the debt, just as gold or silver do. The value of the metal is behind it, just like gold bullion was behind the value of u.s. currency until the 1930's. Indeed, gold and silver are mentioned as the only metals the constitution allowed states to mint money under, and gold is recognized universally as payment of debt should you offer it, far more so then printing of paper money. But platinum, although not so recognized is the most valuable metal on earth, I don't know how many onces would by tequired for a trillion dollars, but you can bet if the govt offered bars of platinum as against debt nations would accept them if the weight of the platinim was equal to is market value. Alexamder hamilton did something very similar to
Pay off revolutionary war debt owed to other countries when the republic was founded and it worked very sucessfully... The deciding factor is not what we think, it is rather, what those who hold our debt think, if they will accept this as payment should we default the problem is solved, if they will not, back to the drawing board. Personally I think its nonsense, that he should invoke section 4 of the 14th amendment and let the tea party cry. Obama doesn't want to go that far, he wants to scare enough of them into voting the debt increase and this is just a type of psychological warfare...

[Heavy-Fed]

So... is THIS the "CHANGE" Obama was talking about?

[Libertyiskey]

Sure the President can do that and mint a trillion dollar coin. Its not going to cost a trillion dollars to make and no one in their right mind would buy a trillion dollar coin when they know its not worth a trillion dollars.

I think I'm going to stamp a piece of paper saying its worth 16 trillion dollars and send it to the White House to do my civilian duty to help pay off the debt.

[MadAmerican]

See this is the problem. Obama is starting to do whatever he wants without America's consent.

[Bobolinsky]

Not if Congress has anything to say about it.

"The Congress shall have Power...To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures;" Article 1, Section 8

Too many republicans and democrats as well understand that creating $1T out of thin air amounts to a big middle finger to the rest of the world from America... a big middle finger from current Americans to future Americans... not to mention the people who would be worst affected by the devaluation of the dollar would be people on fixed incomes and the poor...

All so this current government can continue to borrow and spend at this unconscionable pace... I wonder how what impact that would have on our credit rating? Could it be that the reason our credit rating was lowered in 2011 wasn't that fiscal conservatives were being stubborn about raising the debt ceiling without addressing our spending problem... but rather that they were stubborn about raising the debt ceiling without addressing our spending problem and it didn't do any good?

[DerivePI]

First, trash the paper dollar by coining millions of these Trillion dollar coins. Lets call these coins Rentendollars. Next, reject the old dollar currency and only back the new rentendollars. Finally, remint the Rentendollars without all those silly 0s. Problem solved. Go ahead and keep spending government!

[Bobolinsky]

@DerivePI-- Now where did I put that wheelbarrow?

[DerivePI]

@Bobolinsky - you mean your Schubkarre?

[Buzzfriendly]

It will be worth it weight in...... well nothing.

[Ashstop]

We disagree on something's but your dead on about this!!

[MarkJM]

Who remembers reading about Germany printing out vast amounts of Deutschmarks in the 1930s? Remember seeing images of people bringing wheelbarrows full of Deutschmarks to the bakery for one loaf of bread or using Deutschmarks as tinder to light their fireplaces? If they mint these coins, as legal as it may be, those paper bills won't be worth the monetary value they claim to be. Not only would stocks plummet but the USA Credit Rating would drop as well. You can print money, but you can't print credibility.

[Knightkore]

It's a novel idea...as in an idea that you might find in a fiction novel...{sigh}...now we know why the progressive liberals can't balance the budget...reality...just about any sense of reality escapes them...

[Your_Name_Here]

The real problem is too much stupid in government. Eliminate the stupid and the debt problem will resolve itself.

[jessejaymes]

This is a clear indication of the dumbing down of America. While the ultra rich has intentionally caused the citizenry to lose any semblance of real education K-12, it now appears that this malady ha seeped into our federal govt. The mere idea that someone can float an idea like this and the people, from the great unwashed to the hallowed halls of D.C. go ape is about as telling as it needs to be told. If the govt were to put a trillion dollars of platinum at Fort Knox then mint the damn coin. If not, it's worthless. Except for fodder for both sides to argue with each other about.

Re-elect Nobody 2014

[PayThatCEO]

Every day I believe our nation is getting closer to complete a complete nervous breakdown. It's been coming for a very long time. The lack of cooperation is driving everyone in Washington nuts.

[ProCCW]

That's it, I'm moving way out in the boonies. Fresh spring water and country ways. When it all hits the fan, I will be nice n cozy surrounded by the forest, an a hole bunch of country boys With my 12 guage,AR,9 an a jeep.

[mimi57]

'Driving' them nuts...I think that ship has sailed. LOL