Bumping Up against the Debt Ceiling

Source: Hoover Institution
by Richard A Epstein

“The two bedrock structural principles of the Constitution are the separation of powers and a system of checks and balances. These are always in tension. The principle of separation of powers places with Congress the power to issue the public debt in the name of the United States …. The power comes after the parallel grant to Congress to impose taxes. Together these two clauses are the main revenue drivers for the United States. Yet the current constitutional structure subjects any such debt issuance to a presidential veto …. the constitutional structure creates what is commonly called a ‘bilateral monopoly,’ where each side has a blocking power to any solution that purports to deviate from the status quo ante, which in this case is the unappetizing prospect of a US default on its debt obligations, fraught with uncertain consequences, if the two sides cannot agree on an acceptable compromise.” (05/16/23)