Thread by @StevenTDennis

Flashback to four years ago via @JakeSherman

Congress then attached debt limit to the CR & hurricane $ & Dems voted for it. ***All 17 no votes in the Senate came from Rs.***

Ds want Rs to return the favor, but most are just saying no.
nytimes.com/2017/09/07/us/…

https://twitter.com/JakeSherman/status/899969704856616961

Democrats had the option to defuse debt limit all on their own, but decided to hand a detonator to the GOP. That risks a shutdown fight, rattled markets, and assorted messy scenarios. bloomberg.com/news/articles/…

A decade ago, just getting close to a debt limit smashed consumer confidence, tanked stocks, etc. Folks who went through that experience before, like @danpfeiffer, had suggested Democrats raise limit on their own through 2024 so Biden doesn't face same scenario in his first term.

They haven't taken Dan's advice.

There is some wiggle room in the 46 Senate Rs letter saying they won't raise the debt limit. The letter doesn't say they will *filibuster* the debt limit. cont'd...

IF GOP were to take the extreme step of actually filibustering a debt limit hike, that could be seen as akin to nuclear hostage taking. Would Manchin+Sinema consider overturning the ruling of the chair to prevent default? (Nuking 60-vote threshold.)

Playing with☢️fire, etc.

Dems meanwhile haven't finished writing their $3.5T plan yet, Manchin & Sinema aren't on board with size of spending or tax hikes, etc.

A pickle.

If there is no resolution to the debt limit, past would be prologue — the government shuts down, the White House starts sending out letters warning Social Security checks might be delayed and so on — all in the middle of a pandemic killing 500-600 Americans per day and rising.

That then leads to untested break-glass scenarios — ideas Obama considered and rejected, like minting trillion-dollar Platinum coins and placing them in the Federal Reserve, aka #MintTheCoin, declaring debt limit void under 14th Amendment, and so on.

Assuming House adopts the Senate budget resolution, amending it to do debt limit on your own isn't a trivial process. Even if you find a way through the procedural morass, you're staring at another all-nighter vote-a-rama, etc.

Obama, for what it's worth, has called the night they thought the House wouldn't be able to pass a debt limit and he considered minting the coin et al the scariest of his presidency. finance.yahoo.com/news/obama-sca…

The weird thing about minting the coin is that the Federal Reserve is already holding north of $5 Trillion in federal debt. To the extend they are worried about increasing money supply from minting they can just sell treasuries they already own or taper Pandemic QE.

But it might not be the most confidence-inspiring spectacle for the richest country in history to be minting coins to pay its obligations?