The Debt Limit and the Constitution: How the Fourteenth Amendment Forbids Fiscal Obstructionism

By Charles, Jacob D. | Duke Law Journal, March 2013 | Go to article overview

The Debt Limit and the Constitution: How the Fourteenth Amendment Forbids Fiscal Obstructionism


Charles, Jacob D., Duke Law Journal


ABSTRACT

The statutory debt limit restricts the funds that can be borrowed to meet the government's financial obligations. On the other hand, the Fourteenth Amendment's Public Debt Clause mandates that all the government's financial obligations be met. This Note argues that the Public Debt Clause is violated when government actions create substantial doubt about the validity of the public debt, a standard that encompasses government actions that fall short of defaulting on or directly repudiating the public debt. The Note proposes a test to determine when substantial doubt is created. This substantial doubt test analyzes the political and economic environment at the time of the government's actions and the subjective apprehension exhibited by debt holders. Applying this test, this Note concludes that Congress's actions during the 1995-96 and 2011 debt-limit debates violated the Public Debt Clause, though Congress's conduct during the debate over the debt limit in 2002 did not. And under a departmentalist understanding of executive power, a conclusion of this nature would be the basis for the president to ignore the debt limit when congressional actions create unconstitutional doubt about the validity of the public debt.

INTRODUCTION

Less than a year after Standard & Poor's historic downgrade of U.S. debt, Speaker of the House John Boehner declared that Republicans would never quietly acquiesce in another increase in the statutory debt limit. (1) Although the statutory debt limit, (2) sometimes called the "debt ceiling," has been increased under every president since its codification in 1939, (3) there has been a noticeable shift in recent decades that has caused debt-limit legislation to meet increasingly hostile opposition. (4) And there are signs that the opposition--and the ensuing debate--are becoming more contentious with each legislative proposal. (5) Yet one thing is clear: authorizing such increases is a fixture of American fiscal policy. Though the political landscape surrounding government debt has never been completely tranquil, recent debates have been especially combative. This Note presents a way to distinguish between constitutionally permissible political battles and those that cross the line established by the Public Debt Clause, by asking whether government action creates substantial doubt about the government's ability or willingness to meet its financial obligations.

Since the origin of the Republic, Congress has placed limits on the federal government's borrowing authority. (6) Before World War I, Congress gave the executive borrowing authority only for specific actions through targeted legislation. (7) The modern aggregated limit-which allows the Department of the Treasury (the Treasury) to incur debt on whatever terms necessary--traces back to 1939. (8) The current statute creates an overall ceiling on the aggregate amount of government indebtedness. (9)

The debt limit has always factored prominently in American fiscal policy, often as a source of controversy. From its very inception the debt limit required an increase during each year that the United States was involved in World War II. (10) And though "[c]ongressional executive interactions with respect to the debt limit remained, for the most part, harmonious" (11)in the 1950s, even Republican members of Congress were not sanguine about the prospect of increasing the debt limit as often as President Eisenhower desired. (12) The administrations of Presidents Kennedy and Johnson faced strident opposition to debt limit increases during what had been, in comparison, fairly routine votes under Eisenhower. (13) This conflict was partly a function of the increasing frequency of debt-limit increases (14) and partly a result of disagreement over the ideological presuppositions of Keynesian economic theory, which heralded budget deficits as effective economic stimuli. (15)

In the 1970s, the debt limit began to be used as more than a mere ceiling on governmental borrowing authority. …

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

The Debt Limit and the Constitution: How the Fourteenth Amendment Forbids Fiscal Obstructionism
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.