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The 14th Amendment and the Debt Ceiling

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Eric Foner, who would know, has a fascinating essay on how the 14th Amendment provides an answer to the vexing debt ceiling nonsense.

Long-forgotten provisions of the 14th Amendment are suddenly crying out for enforcement. Section 2 provides for a reduction in the number of representatives allocated to states that deny the right to vote to any “male citizens.” (Today this penalty would apply to the disenfranchisement of women as well.) Even at the height of the Jim Crow era, when millions of African Americans were prevented from voting, this penalty was never imposed. But with many states seriously limiting voting rights, its time may have come.

Section 3 bars from public office anyone who took an oath to support the Constitution and subsequently participated in or encouraged “insurrection.” The events of Jan. 6, 2021, have focused new attention on this stipulation, which could be applied to participants in the uprising who previously held military, political, or judicial positions, including former President Donald Trump.

Then there is Section 4, which offers a way out of the current impasse over increasing the debt ceiling. “The validity of the public debt of the United States,” it declares, “shall not be questioned.”

What were those who wrote, debated and ratified this provision trying to accomplish? The section arose from political conflicts over the way the Civil War had been financed. To pay the war’s enormous cost, Congress printed legal tender paper money (the “greenbacks”), raised taxes to unprecedented heights and authorized the sale of hundreds of millions of dollars in interest-bearing bonds.

Nearly all the laws authorizing the issuance of bonds specified that the government would redeem the notes in gold. The one exception was the act related to the “five-twenties,” bonds redeemable in five years and payable in 20, which was silent on how those who had lent money to the government by purchasing these bonds would be repaid.

This oversight, to quote the historian Irwin Unger, led directly to “a decade of intense and exasperating conflict.” Democrats sought to score political points by demanding that the five-twenties be repaid in paper money (which had deteriorated considerably in value), not gold. It would constitute an enormous unearned windfall, they insisted, for banks and large investors who had purchased these bonds with greenbacks to receive gold back from the government.

“Who has asked us to change the Constitution for the benefit of the bondholders?” Senator Thomas Hendricks of Indiana asked when the amendment was being debated. “Why give them this extraordinary guarantee?”

Republicans pointed out that much of the benefit of payment in gold would be enjoyed by ordinary Americans, who had purchased them from a small army of agents deployed by the financier Jay Cooke. They insisted that the sanctity of the national debt was as much a moral legacy of the Civil War as Emancipation itself.

I think the problem here is not that Foner is wrong. It’s that Republicans don’t give a shit. Nonetheless, basing arguments for basic functioning government in the Constitution never hurts.

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