Some Democrats are urging him to try to use this amendment, which hasn’t been used before, to bypass the Republican-controlled House of Representatives and raise the borrowing limit.
What is the Fourteenth Amendment?
The fourth paragraph of the Fourteenth Amendment, passed after the Civil War between 1861 and 1865, states that “the validity of the public debt of the United States shall not be questioned.”
Historians say the goal is to ensure that the federal government does not repudiate its debts, as some former Confederate states did.
But the article has largely gone unaddressed by the courts, and legal experts differ on what it takes for Congress and the presidency to implement it.
Some, like Cornell University law professor Michael Dorff, say the “least unconstitutional” option is for Biden to act alone to protect the integrity of the national debt.
“It means borrowing money,” he added.
Any action by Biden will almost certainly result in a lawsuit.
Who can go to court because of the debt ceiling?
It is unclear who can sue. It can be difficult for a plaintiff to prove that they have been wronged by the proceedings – a concept known as “legal status”.
The U.S. Supreme Court ruled in 1997 that individual lawmakers lacked the legal standing to bring such lawsuits, but Congress would likely vote to say it suffered collective damages.
The Supreme Court could also choose to hear the case in order to resolve the issue quickly, as happened with Biden’s decision to write off $430 billion in student debt.
The Supreme Court has only once decided an issue related to the public debt clause, in a 1935 challenge to Democratic President Franklin Roosevelt’s decision to remove the United States from “the standard”. gold”. The court held that the plaintiff, who is a bondholder, did not have the legal capacity to bring an action.
What is the White House’s position on the Fourteenth Amendment?
When the issue was raised in Washington in 2011 and 2013, prominent Democrats like former President Bill Clinton urged former President Barack Obama to invoke the Fourteenth Amendment. But White House aides said they don’t believe they have the legal authority to do so.
Biden said Sunday he believes he has that authority, but there isn’t enough time to implement that strategy until it bears fruit before June 1. This is the date the Treasury Department warned that the government may not be able to pay all of its bills.
Treasury Secretary Janet Yellen made similar comments on Sunday.
What would be the market reaction if Biden resorted to the Fourteenth Amendment?
Administration officials and economists have said a default resulting from a breach of the debt ceiling would upend the global financial system and send the United States into recession.
This immediate disaster could be avoided if Biden invokes the Fourteenth Amendment.
However, investors may panic about what is happening and demand higher interest rates to ward off increased risk in the event of legal issues.
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