Some Democrats want to mint a $1 trillion platinum coin to avoid a potential debt crisis.
Two years ago, Congress <a href="https://www.dailywire.com/news/democrats-will-vote-to-suspend-government-debt-ceiling">suspended</a> the debt ceiling — which bars the federal government from assuming a certain level of national debt — until August 2021. Because Congress has so far failed to vote on continuing the suspension or increasing the limit, Treasury Secretary Janet Yellen is <a href="https://www.nytimes.com/2021/09/28/business/economy/yellen-powell-senate.html">warning</a> that the federal government will run out of money on October 18.
As a result, some Democrats are resurrecting a proposal to mint a $1 trillion coin made of platinum and deposit it at the Federal Reserve — an accounting trick that would theoretically retire $1 trillion in government debt.
As <a href="https://www.newsweek.com/dems-revive-controversial-1t-platinum-coin-raise-debt-ceiling-feud-gop-1633568">Newsweek</a> explains:
<blockquote>The idea of minting a trillion-dollar commemorative coin to shore up the nation&#8217;s finances comes from an obscure law that gives the U.S. Treasury Secretary the authority to &#8220;mint and issue platinum bullion coins and proof platinum coins in accordance with such specifications, designs, varieties, quantities, denominations, and inscriptions as the Secretary, in the Secretary&#8217;s discretion, may prescribe from time to time.&#8221;
Proponents have picked up on the &#8220;denominations&#8221; note there, arguing that any amount could be minted at a normal coin size and deposited into the Federal Reserve to prevent a national debt crisis.</blockquote>
The prospect of a trillion-dollar coin is not new. President Obama explained in a 2017 interview that his advisers briefly considered minting the coin amid debate over the 2013 debt crisis.
&#8220;There was this theory that I had the authority to issue through the mint this massive $1 trillion coin and on that basis we could try to pay off US Treasurys,&#8221; Obama <a href="https://www.businessinsider.com/obama-mint-trillion-dollar-coin-scariest-night-debt-ceiling-2017-1">said</a> on Pod Save America. &#8220;It was a very realistic possibility that we couldn&#8217;t get the votes for that and we couldn&#8217;t get those debts rolled over and we would be in a situation where we were technically in default. At that point, you were in uncharted territory.&#8221;
As the controversy over the federal government’s solvency emerges again, Rep. Rashida Tlaib (D-MI) <a href="https://twitter.com/RashidaTlaib/status/1442852913915826187">tweeted</a> “#MintTheCoin” — a hashtag that was used by proponents of the coin during the Obama-era debt crisis. Progressive economist Paul Krugman, for example, <a href="https://www.morningbrew.com/daily/stories/2021/09/24/the-legend-of-the-usd1-trillion-platinum-coin">argued</a> in 2013 that “if we have a crisis over the debt ceiling, it will be only because the Treasury Department would rather see economic devastation than look silly for a couple of minutes.”
As of two weeks ago, the Biden administration has rejected the measure. White House spokesperson Mike Gwin told <a href="https://www.politico.com/newsletters/west-wing-playbook/2021/09/14/bruce-reed-summoner-of-the-techlash-494324">Politico</a> that “there is only one viable option to deal with the debt limit: Congress needs to increase or suspend it, as it has done approximately 80 times, including three times during the last Administration.”

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Some Democrats Want To Mint A $1 Trillion Platinum Coin To Prevent Debt Crisis

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Some Democrats Want To Mint A $1 Trillion Platinum Coin To Prevent Debt Crisis