Congressman Introduces Bill To Ban Minting of Trillion-Dollar Coin

Dainsanefh writes with news that the new Congress isn't wasting any time getting back to work. From the article: "Lawmakers are still positioning themselves for a debt ceiling fight in a few months, but one Republican congressman wants to snuff out a particular idea immediately: the U.S. Treasury minting $1 trillion platinum coins to avert a debt ceiling showdown. Rep. Greg Walden (R-Ore.) has introduced a bill to specifically ban President Barack Obama from minting the coins. The trillion-dollar coin has been previously discussed on Slashdot:"

Comments

Any member can introduce a bill but...

[Calibax]

It's a long way from introducing a bill to getting it through Congress and signed by the President.

Re:What about this.

[istartedi]

You know that war you're fighting? The one with no point or purpose?

You're going to have to be a little more specific. The war in Afghanistan? The continued occupation of former Axis powers that are now allies? The war on drugs? The war on dignity at airports? The wars on poverty where we spend $1 million /year to create one $10k /year job? All of them, or just some of them? Please specify.

Can't America get its acts together ?

[Taco Cowboy]

I mean, why should the United States of America resort to legal loopholes ?

Why can't America just face the reality as it is - that it is spending way too much money than it is making??

How long do you think America can keep spending the money it doesn't have?

I mean, even if America get the minting of quadrillion-dollar plutonium ingot going, the world doesn't have to "buy" it.

All of us balance our own checkbook at the end of every single month, and try our best to live within our means.

Why can't America?

Re:Can't America get its acts together ?

[headhot]

We have separation of powers. Congress writes the budget, appropriates funds, and signs off on debt. Congress also knows that both houses and the President need to sign anything they pass. The President, constitutionally can do none of this. So, if Congress wants to defund things, it can, but they have to do it in a way the President agrees. Also, remember, the House needs to write a bill the Senate will pass. Forget getting it to the President.
We just re-elected Obama, and the House and Senate, even after reapportionment, lost Rs. Its Congresses job to work with the President at this point, not the other way around.

Re:Can't America get its acts together ?

[Anonymous Coward]

I mean, why should the United States of America resort to legal loopholes ?

Why can't America just face the reality as it is - that it is spending way too much money than it is making??

How long do you think America can keep spending the money it doesn't have?

Just as a bit of background: The President of the US is the Executive. Broadly speaking, Congress passes bills to authorize him to do Various Things, and Congress passes bills to allow him to borrow the money to pay for it.

This "passes bills to allow him to borrow the money" is also known as the "debt ceiling". Historically this is uncontroversial and Congress does it as a matter of course. However in recent times, they've started pushing back.

So we're in the faintly ridiculous situation of Congress telling the President to do Various Things, but not giving him the funds to do them with.

Re:Can't America get its acts together ?

[Mitreya]

Why can't America just face the reality as it is - that it is spending way too much money than it is making??

We should.
But this debate is not about that AT ALL. The debt ceiling (and all the platinum coin crap) is about borrowing money to cover the expenses already approved (by Congress, mind you)

The Republicans keep shouting about "spending too much money", but oddly they are not willing to cut defense spending or eliminate the useless TSA (or to stop arguing for more wars). Either way, the debate about spending has to happen during budgeting, not during the debt ceiling extension.

All of us balance our own checkbook at the end of every single month, and try our best to live within our means.

While your basic point is valid, it has been repeatedly pointed out that government budget balancing is nothing like a family budget. A family cannot expect to improve finances by borrowing and investing into infrastructure. Moreover, family income will not shrink (recession) if said family buys fewer things. If government income was constant (i.e. salary-like) regardless of what happened to economy, you would have a better argument.

Re:Can't America get its acts together ?

[aardvarkjoe]

Well, Congress right now is mostly controlled by two political parties, one of which wants to raise taxes and spend more money than we've got, and the other of which wants to lower taxes and spend more money than we've got.

As long as people keep voting these lunatics into office, this is going to keep happening.

And honestly, I don't see that stopping before the US economy completely collapses. I only hope it takes long enough to do so that I won't be around for it.

Re:Can't America get its acts together ?

[PopeRatzo]

I mean, even if America get the minting of quadrillion-dollar plutonium ingot going, the world doesn't have to "buy" it.

The world doesn't have to "buy" it.

It's just to get us over this ridiculous notion that Republicans should play chicken with the government every few months by threatening to not pay the bills we've already incurred. You know, things like the Iraq and Afghanistan wars, and such.

There is a constitutional way to limit spending, and it's got nothing to do with threatening to not pay the debts we've already rung up. If the GOP wants to limit spending, they do it through legislation, not by toying with the faith and credit of the nation.

The coin is a splendid idea, as long as the Fed covers it with bonds in a timely manner.

The trillion-dollar coin is no more a "gimmick" than is threatening to refuse to raise the debt limit. Congress needs to do its job. The House controls spending and the Republicans control the House. Money doesn't get spent without their say-so. If they want to limit spending, then they should just do it. Problem is, they don't want their fingerprints on anything besides cutting funding to public broadcasting, Smokey the Bear and Planned Parenthood, and that doesn't even pay for one C-17 cargo plane (you know, the one that the military doesn't want but is built in John Boehner's district).

They should mint the trillion dollar coin and put Ronald fucking Reagan's picture on it.

By the way, today on Fox, one of the pundits said "Where are they going to find $1trillion in platinum?" Honest to christ, we've got dumbfucks leading the blind.

Re:Can't America get its acts together ?

[Maxo-Texas]

The problem since 1980, is that those with the most money have voted that they pay a lower share of taxes than their share of wealth.

They've been starving 98% of the country out- taking the wealth and income for themselves.

Finally-- Finally (I've been waiting at least 8 years)-- the bottom 98% woke up and said, "wow! The top 1% is taking everything- why the hell do I keep voting to slit my own throat".

If the top 1% earns 40% of the countries income, they are going to need to pay 40% of the taxes.

And since you need at least the first 15,000 to 20,000 just to live, the top 1% are going to pay over 40% of the taxes because after sales tax, gas tax, cell phone tax, etc. tax the bottom 30% is already living in poverty and can't afford federal income tax.

Re:Can't America get its acts together ?

[Kwyj1b0]

All of us balance our own checkbook at the end of every single month, and try our best to live within our means.

I think you'd be surprised at how much debt the average household carries.

Why can't America?

I can pilot an aircraft, why can't I be an astronaut or land on the moon? This is an absurd argument. No one says that you shouldn't live within your means, but countries have a lot of different responsibilities and options than the average citizen. For one, the US can print its own currency - albeit causing inflation. A country owes a billion dollars to someone? Print a billion dollar note and pay them. They just reduced the value of the country's currency, but are debt free (unless they other party owns TIPS). And debt based financing is very common - Boeing might be delivering an aircraft at the end of 6 months to a client, but doesn't have the money for payroll stashed in a bank. They take a loan (debt) to finance growth (making a profit on the aircraft sales) while hiring employees. Countries do the same.

You can buy bonds for many companies on the market - IBM, MSFT, etc.And if the country/organization is credit worthy, they can sell bonds at very low yields - effectively almost "free" money. If they use that for growth, they will profit. The same holds for countries.

Basically, your analogy is flawed - debt isn't itself necessarily a problem. It is what you do with that debt that decides if you go broke or profit.

Re:Can't America get its acts together ?

[ThermalRunaway]

> The problem since 1980, is that those with the most money have voted that they pay a lower share of taxes than their share of wealth.

No. What is "their share" and why should it be more simply because they are more successful? In fact the top 10% of earners pay 70% of all taxes and the top 50% pay 98% (http://www.ntu.org/tax-basics/who-pays-income-taxes.html).

The problem is we continue to take from the top 50% and give it away to the bottom 50% who pay essentially nothing and in many cases get a refund check anyway for various credits. This does little to motivate anyone to try and make more money.

>the bottom 98% woke up and said, "wow! The top 1% is taking everything

I think you mean the top 50% are getting tired of funding the bottom 50%. Everyone should pay something if they have an income. If you have no skin in the game you have no reason to care if taxes go up on everyone else and you will continue to vote yourself more money.

This sums up the real problem nicely:
"A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves money from the Public Treasury. From that moment on, the majority always votes for the candidate promising the most benefits from the Public Treasury with the result that a democracy always collapses over loose fiscal policy always followed by dictatorship."
-- Alexander Fraser Tyler

Re:Can't America get its acts together ?

[Runaway1956]

No - the solution is to "punish" both ends of the spectrum. Make the top 1 or 5 or 15 percent pay their share. Stop giving all those entitlements away.

The people in the middle (like me, and mine) get just about nothing from the government, but the government is in our pockets, taking about 1/3 of our wages every week. All the entitlements go over me, past me, or under me. We, the working people, don't benefit from food stamps, free housing, free utilities, and sure don't benefit from an inverted tax schedule scheme, and we DAMNED SURE don't benefit from wars being fought halfway around the world to enrich the oil industries.

Re:Can't America get its acts together ?

[Gorobei]

So, since I've been rated as a troll already - go figure.

The solution is to just punish the people making money by giving more benefits to those that won't work?

If you think paying taxes is "punishment," you have already placed yourself outside of society as commonly defined.

Do you hate your kids because they cost you money? Are you really being "punished" for being a parent? The USA wants you to succeed: it's not "punishing" you for making more money, it's taking some money to keep society running and ideally investing in the next generation.

You can whine about if it's fair or not. You can even whine about if we should care about making the world a better place for our children, but claiming "punishment" requires a lot more justification on your part.

The USA celebrates success: Bezos, Gates, Buffet, etc are lauded in the press; TV shows and movies makes riches the ultimate happy outcome; being rich gives you a huge benefit when dealing with the legal system. You can be rich here and there is zero demand that you use your money for social good - you can just buy 200 foot boats or hookers or drugs and no one yells at you (try that in Europe!)

So quit whining that you live in a country where you don't need bodyguards when you go to a bar, get drunk on $20 vodkas, pick up a girl who earns $35K/year, get driven home, have sex, and complain to her that the 500,000th dollar per year you earn gets taxed at 50%.

Re:Can't America get its acts together ?

[RyuuzakiTetsuya]

Wow. No one I've ever met has said, "I would make more but I'd just get taxed more." No one.

Re:Can't America get its acts together ?

[theIsovist]

As part of the bottom fifty percent, I encourage you to come down and live on my level. I hold an undergraduate degree from a respected university (rated in the top 50 in the world), have worked for four years in the real world, and now am back in school to continue my education and further my degree (at another top 50 school). I'm living off of less than 20k a year. A wonderful flaw in the government loan system resulted in my summer income (a school research position) being counted one for one against the amount of loan money i could take out this year. In order to pay for tuition, I had to max out my loans, and was left with 200 dollars a month to pay for rent, food, and any school expenses. I'm now, at the advice of the school, on food stamps. Let me tell you, those food stamps - 200 bucks a month - offer me so much more than you can ever imagine. They only pay for food I cook myself. No alcohol, no toiletries, not even the 5 cent bag fee if i forget my bags. However, they allow me to feel like a human. In a few years, I'll be out of grad school, working and pumping far more money into the system than I ever took out. If we taxed the people making more than 200k 36% instead of 33%, they'd still have more than 5 times the amount of money that I live on each year. I work. I work for them. I work doing research to lower energy use, saving money, resources, and perhaps even saving the planet if you're so inclined. Your freeloaders are anything but. Many of us are busting our asses to afford a better life, and one day we will have it. The difference is, we'll damn well be happy to help those below us up. We know how it is down there.

Re:Can't America get its acts together ?

[Rich0]

Do you want to know what the biggest entitlement program in America is? Try being born to rich parents... Nobody has less incentive to work than somebody who is just handed millions of dollars.

Re:Can't America get its acts together ?

[Anonymous Coward]

No - the solution is to "punish" both ends of the spectrum. Make the top 1 or 5 or 15 percent pay their share. Stop giving all those entitlements away.

The people in the middle (like me, and mine) get just about nothing from the government, but the government is in our pockets, taking about 1/3 of our wages every week. All the entitlements go over me, past me, or under me. We, the working people, don't benefit from food stamps, free housing, free utilities, and sure don't benefit from an inverted tax schedule scheme, and we DAMNED SURE don't benefit from wars being fought halfway around the world to enrich the oil industries.

this is one of the biggest misconceptions about how the middle class benefits. of COURSE you benefit, and in one huge way: economic stability.

the safety net for people earning less than you prevents an underclass from bottoming out the economy while providing the workforce for high-labor, low-skill work. it also prevents externalities that rise from poverty, like crime, urban decay, and other unsavory elements, from getting out of hand. these "entitlements" are meant in large part to keep the economy stable so that people don't suffer from extreme swings, and that people generally have chances to work hard and succeed.

i'll agree with you on the wars, and the whole point of Obama's push to raise taxes on the wealthy was to try and even out the huge benefits reaped on lower taxes.

then there are infrastructure things like highways and roads, telecom and electric, fire departments, police and other law enforcement, water, sewer, etc. which are funded by taxpayer dollars and directly benefit everyone who uses those systems.

Re:Can't America get its acts together ?

[stretch0611]

What is "their share" and why should it be more simply because they are more successful?

One simple reason: It takes money to make money. If you are making minimum wage or any amount slightly above the poverty line, all your money is going to living expenses. You do not have money to invest.

If you have a large nest egg investing is easier... If you have bills to pay, you may be forced to remove money from the market at an inopportune time. There used to be a saying on wall street... "To turn 10 thousand dollars into 20 thousand dollars requires skill; to turn 10 million dollars into 20 million dollars requires only patience."

In addition one of the better investments is education. In general the more education you have the more you will make in the long term. However, when it is hard even for the middle class to send their kids to college, a good education is not always possible. And scholarships only take care of a small minority. Even with a full scholarship, a person may not afford college because they still need living expenses.

If you already have money, you can make smart long term investments to make your future even brighter and generate even more wealth. If you have very little, it is a struggle to keep afloat from day to day, let alone invest for the future.

I think you mean the top 50% are getting tired of funding the bottom 50%.

We realize this and it happens every day. While the wealthiest people generally are the business owners and investors, they pay employees less every year compared to inflation. Wages have stagnated, yet inflation still increases. And the travesty is that most business owners credit themselves as the only reason why their business succeeds; yet in many cases, yet the customers are more likely to deal with the low-end wage slave.

And yes, wage slave is appropriate... The wealthiest always say that if you don't like the pay to find another job; but it is hard to say no to even a bad offer when there is a lot of unemployment especially when you have children that have only had mac and cheese for the last 3 months. And when you have a job, there is not a lot of time available to actually find a new job if you are not happy.

Everyone should pay something if they have an income.

No, if someone can barely afford food and shelter, they should not pay.

And let me add this... Why is it that investment income is capped at 15% for capital gains (now 20% as of 1/1 for people over $400,000) A rate that is much lower than taxes on the middle class who work. The people who are sitting on their asses pay less in taxes (as a percentage.) Hard work should be rewarded, not sitting on investments. The rich cry foul saying that low taxes motivate them... believe me, they would be a lot more motivated if there was a real threat to the value of their wealth diminishing if they did not invest it.

Re:Can't America get its acts together ?

[The Master Control P]

I see the lie about how the poor "pay no taxes" is out in force.

Guess what? Between Social Security, FICA, sales taxes, gas tax and other local taxes, the poor pay quite close to as large a fraction of their income in taxes as the rich do. Sure as hell more than the 15% rate on the capital gains that aren't hidden in Switzerland or Grand Cayman.

And unlike someone born rich, who has never been deprived of anything in their entire life, who goes around thinking about what a self-made-man they are and how they personally earned everything they have (while quietly not recognizing the hundred dozen government services that keep them safe and make their wealth possible), seeing 20% or 30% of my $20K/yr grad student salary disappear off the check stub actually hurts. So please spare us the tears about how you hate "funding" the people who do all the society-enabling tasks that are beneath your notice - often enough two or three of them at once since the days of a blue collar job reasonably supporting a family are Grandpa's fading memories - because you might have to light your cigars with jacksons instead of benjamins.

Re:Can't America get its acts together ?

[eriks]

I think you mean the top 50% are getting tired of funding the bottom 50%. Everyone should pay something if they have an income. If you have no skin in the game you have no reason to care if taxes go up on everyone else and you will continue to vote yourself more money.

Poppycock and flapdoodle. There are (roughly) 10,000 individual human beings that control half of the worlds wealth and resources, 40 years ago, that same bracket had a strangle-hold on only one quarter of the wealth and resources. Anyone that can stand up and look the rest of us in the eye and say with a straight face that that is all just fine and dandy is either lying or deluded.

So long as we have an income tax (that's another conversation...) I say with a resounding YES: the ultra-rich (>10 million "net worth") should pay much more (as a percentage) of their income in taxes than do the working poor ($0 "net worth"). It's called progressive taxation, and it's ABSOLUTELY necessary so long as there is such a HUGE chasm between the top 0.1% and the bottom 50%, financially speaking. Granted, the culture of greed that dug that chasm is a social issue, and cannot be solved politically. Progressive taxation is treating the symptom.

The solution? Damned if I know. I do know it's going to get worse. Automation and other gains in productivity-efficiency are going to drive unemployment higher and higher. What are the working poor going to do when there is no longer any work for them? Ahh, Innovate! you say. Come up with new ideas? But guess what, there have been only a handful of "self-made men" in over half a century. All "innovation" is doled out in drips and drabs by the moneyed-interests. It would take a fucking miracle at this point for someone to come forward, out of nowhere (like happened repeatedly in the early 20th century) and make their mark on the world with a new invention or process. The system is stacked against it. Yeah, there's the dotcom thing that happened over a decade ago, but what have we (other than a few neat gadgets) to show for it? What upward mobility did it cause? Very little, and to a limited sector of the population. Who did it ultimately benefit? Mostly venture capitalists and giant financial firms.

I have (some) sympathy for the "middle rich", that "only" earn a quarter million a year. In that many of them probably did work very hard to get where they are. But guess what. They can still feed their families, afford a nice house, a couple of nice cars, and send their kids to good schools, even if their tax rate goes from 35% to 39% or whatever. It's not going to send them spiraling into poverty, or make them quit their jobs and go on welfare, that's patently absurd. If you want to give them tax-relief, let's give them huge tax credits for super-insulating their homes, home-solar energy projects and making better automotive choices, so they're investing in the future of humanity, instead of borrowing against it.

The ultra rich on the other hand are hoarding, plain and simple. In some cultures, in times of crisis, hoarding (food) is a shameful or even criminal act. We're all on this planet together. Some people seem to think that if they have enough money and power they can place themselves above everyone else, and don't have to actually share the planet with the rest of us. It's a *disease* and it's fucking celebrated, by people who should know better. Probably because they hope they can achieve the same station. Riiiiiight. Like that's gonna happen.

Sorry for the diatribe, but this kind of willful-ignorance really burns me.

Re:Can't America get its acts together ?

[Bodero]

What was it that Mitt Romney said he paid? 15%? Their tax rate might be 35% but they're not paying 35%

You are confusing income tax with capital gains taxes. Both parties have set up a tax code that does not tax the rich, but taxes those who are becoming rich. If Mitt Romney makes $0 in income and $0 in capital gains, but still has $500+ million in the bank, guess what his tax rate is? 0%.

If an entrepreneur who is putting his blood, sweat and tears into a company trying to become rich, and earns $1m last year, he's paying the highest rate.

The already-rich love this. That's why you hear Warren Buffet, et. al., saying tax rates should be higher - to make sure others don't get to the same level of wealth (and therefore, power) they are. They don't earn income.

Re:What about this.

[alen]

We did that after the Cold War ended
We got a huge economic and technological boost as those people were freed up for the civilian economy

Re:What about this.

[PerformanceDude]

Redirect the spending into the space program and reap the rewards. The US had a golden age on the back of the technological advances made possible through the Gemini and Apollo programs. It can be done again...

Also, the really big thing

[Sycraft-fu]

Is the government can't save money. Part of a sound personal budget is saving money in good times so it can be spent in bad times. Fair enough, but the government can't do that. It is meaningless for the entity that mints money to "save" it. If the government printed, or rather simply changed the entry in a database, so they had more money, but then didn't put that money in to circulation and "saved" it, it would have the effect as if they'd done nothing. If instead they actually took money out of circulation, kept it when they collected taxes or what have you, it would lead to deflation which is a very, very bad thing.

So what does the government do? Well it borrows. When the government "saves" what it does instead is to pay down the amount of outstanding debt. Then when it "spends savings" it issues more debt.

That is how it works. You can't compare public accounts to private ones because they function different. You can't demand that the government run itself the same way you run your personal finances, because they aren't the same.

That isn't to say that the government doesn't need to keep borrowing reasonable, but it is very different than personal borrowing.