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  • sstail94 sstail94 Jan 8, 2013 1:31 PM Flag

    My 2013 Cloudy Crystal Ball


    IMO Obama could not use the 14th Amendment is any way around the debt ceiling. The 14th amendment recognizes the debt. It does not say how it might be incurred or increased, and as the constitution specifically gives the power of revenue and spending to Congress, Obama is out of luck. He would be committing an impeachable offense.

    Section 4. 14th Amendment

    The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned. But neither the United States nor any state shall assume or pay any debt or obligation incurred in aid of insurrection or rebellion against the United States, or any claim for the loss or emancipation of any slave; but all such debts, obligations and claims shall be held illegal and void.

    The Supreme court will not hear any gay marriage initiative
    Congress will not pass any Gun Control Legislation
    The Economy will tank as a result of the increased taxes and costs of Obamacare
    UE will again rise to over 8% and possibly more

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    • Yes, exactly right. The constitution does give the right to create laws of both revenue and spending to Congress. But if Congress passes a budget that might require money to be borrowed to pay for the spending that Congress approved, and the President signed the bill into law, then shouldn't the president be required to do exactly what the law requires and that Congress approved? If so, then the president must borrow money to do what Congress instructed, regardless of any spending limits? Certainly Congress knew that their budget would require some money to be borrowed when thy approved it!

      The Supreme court will hear 2 gay marriage cases in March. 1. Hollingsworth v. Perry which concerns the California ban on gay marriages, and 2. United States v. Windsor, which concerns whether the US must honor same-sex marriages that have been performed in states where they are legal. At present the US honors no same-sex marriage on tax forms, or for things like social security benefits.

      Sentiment: Hold

    • The 14 Amendment question is tricky. Presumably the issue would arise if the country was about to violate the debt ceiling and the President ordered the Treasury Secretary to issue new Treasury Notes and Bonds. If the financial markets believed that the new debt had the same full faith and credit guarantee of existing debt, they would buy it; if not, they wouldn't. The 14th Amendment's statement that the validity of the debt "shall not be questioned" suggests that even if the new debt exceeded the debt ceiling, it would find a market, but that's far from a sure thing. And the new "14th Amendment" debt would very likely carry a much higher interest rate than the old debt that didn't breach the debt ceiling.

      My guess is that the market response, rather than any legal theory, would determine the status of the new debt. If the markets bought it, even at a higher price, the practical reality is that the debt ceiling limit would have been nullified.

      FYI, the Supreme Court has scheduled 2 days of hearings on the California Proposition 8 case and a related case challenging the Constitutionality of the federal Defense of Marriage Act. But I assume you meant to say that the Court would uphold Prop 8 and DOMA.

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