For nearly a week so-called nonessential services in the US government has shut down due to a budget impasse over a House demands that link deferral of Obama’s signature legislation The Affordable Care Act (Obamacare) to a new budgetary continuing resolution. Much discussion in the media has focused on this as a partisan fight over that one issue. But that’s merely a short term rationale for this fight. The House GOP wants much more come October 17th, when if this impasse is not resolved the United States will lack funds necessary to pay interest on Treasury debt. In short, the US government will go into default, an outcome that Yalman Onaran of Business Week argued would be worse than the failure of Lehman Brothers in 2007. And that ultimately led to a worldwide financial crash and economic crisis not seen since the US Great Depression that has been ongoing for years.
Failure by the world’s largest borrower to pay its debt — unprecedented in modern history — will devastate stock markets from Brazil to Zurich, halt a $5 trillion lending mechanism for investors who rely on Treasuries, blow up borrowing costs for billions of people and companies, ravage the dollar and throw the U.S. and world economies into a recession that probably would become a depression. Among the dozens of money managers, economists, bankers, traders and former government officials interviewed for this story, few view a U.S. default as anything but a financial apocalypse.
But even worse, should the House succeed in this brinkmanship the long-term effect is far more serious to ongoing constitutional functioning of the US democratic-republic. For if the House succeeds in setting a precedent where threatening default on US debt is the norm in achieving nonbudgetary policy goals, then the House will have extra-constitutionally usurped authority from the Senate, Executive, and Judicial in deciding core policy beyond even mere budgetary matters. This is why the brinkmanship represents a constitutional crisis in the making.
How Not to Make Legislative Sausage
The process we all learned in high school civics would have the House of Representatives as expressly assigned the task of debating and passing an initial budget proposal. An alternative is debated and passed in the Senate, where divergences between the two are reconciled in a conference committee hearing. Which is then handed to the President for signing into law or veto as the Executive sees fit. If the legislative and executive branches are unable to resolve disputes within the yearly time frame for a lawful budget, congress may pass a continuing resolution whereby the prior budget is re-instated for a temporary duration until the impasse is resolved. That’s the the normal legislative process for all lawmaking, including the budgetary process.
The House Republican list circulating on K Street indicates the GOP also hopes to kick-start tax reform, permit the Keystone XL oil pipeline and trim a slew of federal regulations in exchange for a borrowing boost.
The move to the debt ceiling comes as Congress moves toward a possible government shutdown on Oct. 1. Moving to the debt ceiling fight, which Republican leaders have long seen as stronger ground, could be a way to convince rank-and-file Republicans to fight their spending and healthcare battles there rather than on a government funding bill.
Obamacareless But One Wrench Among Many Gears to Shut Down
But it’s the ACA measure in this shutdown battle that has really roiled widespread protest against these tactics. In a CNN video editorial, Fareed Zakaria does a good job explaining why in simple terms.
This appears unconstitutional. Article I Section VII requires that budgetary bills originate in the House, where they are debated in the Senate. Differences between House and Senate Bills are reconciled in conference committee. The final bill passed is then sent to the President for a signature or vetoed.
The Fourteenth Amendment, in its fourth section, explicitly declares: ‘The validity of the public debt of the United States, authorized by law , … shall not be questioned.’ While this provision was undoubtedly inspired by the desire to put beyond question the obligations of the government issued during the Civil War, its language indicates a broader connotation. We regard it as confirmatory of a fundamental principle which applies as well to the government bonds in question, and to others duly authorized by the Congress, as to those issued before the amendment was adopted. Nor can we perceive any reason for not considering the expression ‘the validity of the public debt’ as embracing whatever concerns the integrity of the public obligations.
We conclude that the Joint Resolution of June 5, 1933, in so far as it attempted to override the obligation created by the bond in suit, went beyond the congressional power.
There is absolutely no rational argument that either legislative body in congress has the authority to withhold fulfilling its constitutional fiduciary responsibilities for the sole purpose of exacting policy concessions otherwise unrealizable through normal legislative practice. Funding the government is explicitly their job. For one legislative body to refuse to fund government without policy concessions from either another legislative body, the Executive, or Judicial clearly expropriates authority in an extra-constitutional manner and thus violates the balance of powers our founders initially intended.
That budget disputes have led to partial government shutdowns many times over the last thirty plus years only indicates that congress has been slowly sliding down a slippery slope toward fiscal Armageddon without judicial challenge. In the 1980s these fights were strictly budgetary and resolved quickly. It was not until 1995, when a dispute between the House under Speaker Newt Gingrich and President Clinton shut down government operations twice for weeks. And even then it was over future budgetary matters and not unrelated legislation that had been previously passed into law.
This time what the House GOP demands is far more than simply winning a minor partisan budgetary fight. For should they win, from an institutional standpoint the House would gain a privilege, regardless of party control, that it has never enjoyed previously. There may have been shutdown fights in the past, but at no time has the House asserted a demand to change prior lawmaking in order to fund interest payments on Treasuries or the basic operations of government.
If a Conservative Dissents in the Woods Will The GOP Listen?
There are conservatives who also call this approach by the GOP downright radical. For example, Rod Dreher at The American Conservative directly challengedthe House GOP on this tactic. Quoting Russel Kirk’s Ten Cannons of Conservative Thought, he responded:
Consider one of Russell Kirk’s Ten Canons of Conservative Thought:Fourth, conservatives are guided by their principle of prudence. Burke agrees with Plato that in the statesman, prudence is chief among virtues. Any public measure ought to be judged by its probable long-run consequences, not merely by temporary advantage or popularity. Liberals and radicals, the conservative says, are imprudent: for they dash at their objectives without giving much heed to the risk of new abuses worse than the evils they hope to sweep away. As John Randolph of Roanoke put it, Providence moves slowly, but the devil always hurries. Human society being complex, remedies cannot be simple if they are to be efficacious. The conservative declares that he acts only after sufficient reflection, having weighed the consequences. Sudden and slashing reforms are as perilous as sudden and slashing surgery.What are the probable long-run consequences of shutting the US Government down over Obamacare? Do the Congressional Republicans care? Do they care what kind of damage they are doing to the ability of Congress to legislate effectively on all kinds of matters? The damage they are doing to the economic stability of the United States? This kind of brinksmanship might — might — have been defensible during the Obamacare fight, but today? I can’t see it. I can’t see any good coming out of this, at least any good that stands to outweigh the bad.
Suddenly, the line in the sand between radicals and leadership has ceased to be immigration and has become (again!) shutting down the government and defaulting on the debt. And on those issues, the leadership is overwhelmingly winning. The shutdown caucus is led by Ted Cruz, Rand Paul, and Marco Rubio: i.e., senators less interested in winning a fight in Congress than in impressing Iowa caucus voters. They are just as happy to lose on the shutdown issue—happier, since they don’t then have to take responsibility for their actions—provided they get enough publicity on the way down.
The Republicans cannot govern. These people aren’t conservatives. They are radicals. What on earth would Russell Kirk say if he were alive to see this?
Constitutional Schmanstitutional, I Got Mine – Fuck You
It articulated a take-no-prisoners legislative strategy that had long percolated in conservative circles: that Republicans could derail the health care overhaul if conservative lawmakers were willing to push fellow Republicans — including their cautious leaders — into cutting off financing for the entire federal government.
“We felt very strongly at the start of this year that the House needed to use the power of the purse,” said one coalition member, Michael A. Needham, who runs Heritage Action for America, the political arm of the Heritage Foundation. “At least at Heritage Action, we felt very strongly from the start that this was a fight that we were going to pick.”
Intent is crucial, for if a financial crisis were to result from mere incompetence or ineptitude by House members, there would be no clear means of showing bad faith. Since a default clearly violates the 14th Amendment and Perry v. United States, and since this move by the House intentionally thwarts traditional balance of powers in government, a constitutional crisis could be argued through the insurrection clause in Section 3.
No person shall be a Senator or Representative in Congress, or elector of President and Vice President, or hold any office, civil or military, under the United States, or under any state, who, having previously taken an oath, as a member of Congress, or as an officer of the United States, or as a member of any state legislature, or as an executive or judicial officer of any state, to support the Constitution of the United States, shall have engaged in insurrection or rebellion against the same, or given aid or comfort to the enemies thereof. But Congress may by a vote of two-thirds of each House, remove such disability.
Thus, a real potential for a constitutional crisis forms if one assumes an insurrectionist movement has unconstitutionally usurped powers to thwart constitutional governance.
Which doesn’t mean President Obama would push to see such an outcome. He’s already rejected a call to use a 14th amendment declaration of emergency powers to resolve the debt crisis. Arguing on the grounds that to invoke an emergency would create controversy over the legality of debt issued, thus diminishing debt value and affecting markets similar to a default.
“If you start having a situation in which there’s legal controversy about the U.S. Treasury’s authority to issue debt, the damage will have been done even if that were constitutional, because people wouldn’t be sure,” Obama said in a news conference with reporters yesterday. “It’d be tied up in litigation for a long time. That’s going to make people nervous.”
President Barack Obama said, “If you start having a situation in which there’s legal controversy about the U.S. Treasury’s authority to issue debt, the damage will have been done even if that were constitutional, because people wouldn’t be sure.”
“There are no magic bullets here,” he said.
Yet, regardless of what happens with the current budgetary impasse, for the House to succeed in achieving the policy goals by these means, such a precedent would wreck Senate authority in legislative compromise in the long term for a minor short-term gain this election cycle.The crisis in debt default is overshadowed by a deeper separation of powers crisis. Obama appears to realize this by his refusal to stand-down. Yet, ironically, his refusal to seek a direct executive solution also affirms it.
Writing about Juan Linz, a noted professor of political science from Yale, Chait referred to an essay the professor had written where he said that, “Presidential systems veered ultimately toward collapse everywhere they were tried, as legislators and executives vied for supremacy.” Arguing that the US is in just such a trap proposed by Linz, Jonathan Chait concluded that such a standoff between the executive and legislative branches would ultimately result in a constitutional crisis.
The standoff embroiling Washington represents far more than the specifics of the demands on the table, or even the prospect of economic calamity. It is an incipient constitutional crisis. Obama foolishly set the precedent in 2011 that he would let Congress jack him up for a debt-ceiling hike. He now has to crush the practice completely, lest it become ritualized. Obama not only must refuse to trade concessions for a debt-ceiling hike; he has to make it clear that he will endure default before he submits to ransom. To pay a ransom now, even a tiny one, would ensure an endless succession of debt-ceiling ransoms until, eventually, the two sides fail to agree on the correct size of the ransom and default follows.
While Chait’s argument focuses on the power division between the executive and legislative branches, this current impasse also creates a rift within the legislative between both bodies of congress. From either perspective, it follows that a constitutional crisis over failed power sharing either between the executive and legislative branches or between each chamber of the bicameral legislature is in the making.
One could easily oppose Obama’s ACA and yet still see the serious constitutional problem this creates in disrupting the balance of power within the legislative branch, as well as between the judicial and executive. This is a line in the sand moment. Not because Obamacare is really that important. Or because of predictions that if the United States defaults on its debt there will be devastating economic repercussions worldwide – which there most likely would be. But because the GOP, in their half-hearted claims of ‘defending the constitution’ to defeat Obamacare by any means possible, would themselves destroy constitutional principles of legislative process should they win.