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The Three Ways the Debt Ceiling May Be Dealt With

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The next looming fight in Congress is clear and the battle lines have already been drawn. The debt ceiling will be reached in roughly two months. President Obama claims that he will not negotiate over it again. Meanwhile Republicans are demanding spending cuts with no tax increases in exchange for raising the debt limit. Republicans threaten they will allow the country to default unless Obama gives them what they want.

When two completely contradictory positions collide there can only be a few basic outcomes. Both Obama and the Republican position can’t happen. There is no halfway point between no negotiation and demanding concessions. One side must win.

1) Obama uses unilateral action – Probably the simplest but legally most problematic way to resolve the debt ceiling is for Obama to ignore the GOP. Obama could use some unilateral method to raise the debt ceiling if Congressional Republicans don’t approve a clean increase. Obama could mint a trillion dollar coin, invoke the 14th amendment, or say that Congress has forced him to break at least one law so the one he chose to break is the debt limit. Regardless how, the best way for Obama to actually not negotiate over the debt limit is to not need to negotiate. In the past, though, the Obama team has dismissed the 14th amendment solution.

2) Republicans fold – If Obama doesn’t take unilateral action, the only way he can truly stick to his promise not to negotiate over the debt ceiling is to make the GOP fold. Given that the GOP claims they will go over the limit, this may require Obama to grow a serious spine by letting the debt limit be reached. If the country does go over the borrowing limit, Obama could try to use his bully pulpit to put the blame on the GOP. The hope would be that intense pressure from the public and, more importantly, from the financial industry would force the GOP to give in. This would require Obama to show significantly more resolve when faced with a looming crisis than he has so far in any Congressional negotiation

3) Obama folds – The final way the debt ceiling could be addressed is by Obama breaking his promise not to negotiate. The GOP would raise the debt ceiling if Obama gave them some cuts. Obama could either directly fold or pathetically try to use some fig leaf to pretend he stuck to his word. For example, the deadline for the sequestration delay will also happen in two months. Obama could claim that he only negotiated over the sequestration while actually reaching a deal that includes the debt limit. Despite what anyone may say, if a temporary debt limit increase is part of a broader negotiation than Obama did negotiate over it. The fact that the Obama administration’s major concession in the recent tax deal was to have the debt limit and the sequestration delays both come up at the same time is not a reassuring sign.

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Jon Walker

Jon Walker

Jonathan Walker grew up in New Jersey. He graduated from Wesleyan University in 2006. He is an expert on politics, health care and drug policy. He is also the author of After Legalization and Cobalt Slave, and a Futurist writer at