There's a push to have the president create a special weapon to avert another debt ceiling crisis. That special weapon is a trillion-dollar platinum coin, and it's a proposition the Obama administration may be forced to soon consider.
The movement is gaining steam, and the latest indication is a new White House petition calling for the measure. Created on Thursday, the petition already has gained 2,067 signatures as of 1:17 p.m. Friday. Any petition that garners 25,000 signatures requires a White House response. From the petition:
With the creation and Treasury deposit of a new platinum coin with a value of $1 trillion US Dollars, we would avert the absurd-yet-imminent debt ceiling faceoff in Congress in two quick and simple steps! While this may seem like an unnecessarily extreme measure, it is no more absurd than playing political football with the US -- and global -- economy at stake.
Thanks to a quirky law, the government can mint a platinum coin worth any amount. It then can deposit it at the Federal Reserve to pay off $1 trillion in debt, which would swing the government far below its debt limit. There are questions about whether this really would be legal or constitutional though.
Supporters argue this is the only way Obama can avoid cutting Social Security and other social insurance programs. Congressional Republicans, including Senate Minority Leader Mitch McConnell, have demanded spending cuts in exchange for raising the debt ceiling, which the government technically has hit already. The Treasury Department now is taking special measures to prevent default, measures that can last only until around February.
Not raising the debt limit would have catastrophic consequences. It would force the U.S. government to default on its debt by preventing it from borrowing to pay its existing bills. It could even cause a financial crisis, market crash and recession, since so many investments hinge on the bet that the U.S. is unlikely to default.
But the coin idea is problematic to some, who warn that it could be a slippery slope toward hyperinflation, since the government would have created new money specifically to finance borrowing.
Check out some tweets about the petition below: