Why the 14th Amendment doesn't mean the government can't default on Treasury debt
There’s very good reason to be skeptical about the claim that the 14th Amendment requires the president to fund payments on the debt as they come due. The relevant provision of the 14th Amendment is the first sentence of section 4, which reads:
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.
Notice that there’s nothing there mandating timely payments of debt as they come due. The section was designed to reassure creditors of the United States that the southern states who had rebelled during the Civil War would not be permitted to argue against the validity of debt incurred by the Union in putting down the attempted secession. This is made very clear by the next sentence of Section 4, which makes the opposite point: that the United States would not assume the debt of the Confederacy or owe money for emancipated slaves.
Even outside of this historical context, however, there is a clear difference between questioning the “validity of the public debt” and failing to make a payment on that debt. Think of it in any other context and this is obvious. When a homeowner fails to make a payment on a mortgage, the validity of the debt is not questioned. The homeowner is just delinquent on a payment. The same with a consumer credit card or a corporate bond. The failure to make a payment does not mean the debt is invalid—it means that the borrower is delinquent or has defaulted.
This also means that the 14th Amendment does not make the debt limit unconstitutional because it might prompt a default. Defaulting is not the same as denying the validity of debt.
"The Hollow Crown" began Friday on PBS. It comprises new television film productions of four Shakespeare plays that are often called the Henriad because they tell the story of the rise of King Henry the V. The first of these is titled RIchard II. If you missed in on Friday night you can now watch it online.
These are really stunning productions to watch. They are basically feature films shot on location. While purists will always tell you that a great Shakespeare stage production is superior to even the best filmed productions, film offers certain things no stage production ever will. As Neil Genzlinger points out, “When a full battle is called for, you see a battlefield, with horses and armies.” These are things that usually take place off stage.
Richard II is an enigmatic play that has left generations of readers and audience members scratching their heads. It tells the tale of the downfall of King Richard II and the rise of King Henry IV in a way that has perplexed a great many people. So I thought it might be helpful to those of you who want to better appreciate the play for me to discuss what’s really going on.
First, a bit of fair warning. What you are about to read might get you laughed out of a college Shakespeare class. It run contrary to the views of most scholarly readers of the play. Generations of scholars have allowed the fog of conventional views to make what’s really happening in Richard II invisible to them.
One of the things that makes RIchard II so puzzling is that it appears to begin after so much has already happened. Indeed, it has been argued by critics that the central most important event of the play is the death of Thomas Woodstock, the Duke of Gloucester. This takes place, however, entirely before the play begins. This has struck some literary critics as a serious flaw in the play, requiring us to bring too much historical knowledge with us to its performance.
Perhaps we critique this choice of Shakespeare’s, it would be safer to attempt to understand it. Why does the play begin where it does? Or, to ask the question more precisely, what is accomplished by having the play begin where it does.
The first thing to notice is that it puts us in the midst of a confusion. We are made to question the quality of or knowledge of the past. Many commentators have assumed the truth of two of the central accusations of the play: Bolingbroke’s accusation that Thomas Mowbray killed Gloucester and John Gaunt’s accusation that Richard ordered the murder.
Shakespeare denies us any simple point of view from where we could see if these accusations are true or not. By beginning not with the event of Gloucester’s death but with the conflicting claims of Bolingbroke and Mowbray, Shakespeare draws a question mark over the death of Gloucester. We do not know, at least from the evidence at the beginning of the play, who is telling the truth.
Keeping that question mark in place is important to the action of the play. This question is never resolved. It is a permanent question, a mystery.
Many critics, by assuming the truth of Bolingbroke and Gaunt’s accusations make the play at once too simple and incomprehensible. Too simple: the play just becomes a morality tale in which a king is brought down following his unjust act. Incomprehensible: why does Shakespeare take us so deep into the interior life of Richard II, portraying him as a serious Christian, yet reveal no sign of remorse or justification for the the murder?
Another reason not to prematurely convict Richard of Gloucester’s murder is that the end of the play provides a serious alternative that cannot be ignored. In Act V, Scene V, Sir Piers of Exton reveals that he believes he has received a secret instruction from Bolingbroke, now King Henry IV, to kill Richard. Of course, this is a misinterpretation on Exton’s part.
We’re required to at least inquire: if Henry is not culpable for Richard’s murder, could Richard have also been innocent of Glouceter’s? That is to say, Exton’s murder of Richard shows us the alternative story by which Mowbray may have carried out the murder of Gloucester, believing himself under orders from Richard, yet Richard could be innocent.
There are echoes here of the killing of Thomas Becket at the hands of knights in the service of King Henry II. That king, of course, founded the Plantagent royal dynasty. Richard II is considered last in the direct line of Plantagent kings. The lines ends as it began: with a murder committed on orders that were never issued.
There are other ways Shakespeare implies the innocence of Richard, or at least keeps scribbling question marks over the conviction. The question marks, however, are written in invisible ink. Which is to say, we find them by the absences of things rather than by presences. They are located by empty spaces where we would expect answers.
The absence of confession is one invisible question mark. Nothing in Richard’s character gives us reason to doubt the seriousness of his Christian belief. So why, when he knows death is approaching, do we not get a confession from him? If he was involved in the murder of Gloucester, surely there would have been confession and atonement.
Mowbray’s attitude toward the king is another sign. He does not at any point behave as a co-conspirator with the king. indeed, he worries that king will be biased against him because Bolingbroke is the king’s cousin. That is at least circumstantial evidence of Mowbray’s innocence—and by extension the innocence of Richard. And it is even stronger evidence of the lack of a conspiracy between them.
Along the same lines, let’s not forget the extreme punishment of Mowbray, who is banished for life from England. His antagonist Bolingbroke is banished for 10 years, a sentence almost immediately reduced to six. This is contra-indicative of a conspiracy between the king and Mowbray.
Mowbray dies off-stage, almost unnoticed. We’re denied any facts about the circumstances of his death, including the possibility of confession. Another invisible question mark.
Finally, and perhaps decisively, we have no evidence at all of the guilt of Richard. We have only the beliefs of Gaunt, Woodstock’s widow and (although only implicitly) Bolingbroke.
Which is to say, Richard II reads much like a defense attorney’s case against Richard’s accusers. The evidence in inadequate, the witness unreliable, and other narratives better explain what we know.
But if Shakespeare is an advocate of Richard II’s, why not acquit him directly by providing evidence of innocence rather then point to the absence of evidence?
The answer may be that the chase for RIchard is best understood when it must be discovered. The activity of discovering the hidden case for RIchard is important to understanding it at all.
To put it more clearly, the discovery of reason for skepticism is best undertaken rather than simply taken, accepted. Conventional wisdom cannot be refuted by authoritative opinion but by probing questions. The belief in Richard’s innocence based on the opinion of Shakespeare is no better than the belief in his guilt based on conventional wisdom.
This is why the play begins without showing us events that are so central to its action. It is the mystery that is truly central and the action of the play is discovering the existence of the mystery. The uncovering of questions hidden beneath conventional opinion is the task of the audience of Richard II and Shakespeare’s great accomplishment in this puzzling play.
“Suppose you grow up poor in Alabama. You decide to move to New York to make a better life for yourself. But when you get to the state line, you’re stopped by armed men who won’t let you in. New York already has enough people, they say, and it doesn’t need you. And since you weren’t born there, you have no right to go there. You would — quite reasonably — find this ridiculous. So why is it any less ridiculous to tell a Guatemalan or a Bangladeshi that he cannot move to the U.S.?”—
There is a lot of cocaine use in finance. A head of one of Wall Street’s top firms used to keep an antacid bottle full of the stuff in his desk drawer. A top trader from Bear Stearns once showed me a cocaine dispenser he had built from a retractable ballpoint pen that had his firm’s logo on it. At the TGIF’s near Wall Street you could silently pick up cocaine just by leaving a very large tip for the bartender; he’d then slide a napkin covering a baggie of coke across to you. Talk about an over-the-counter trade.
“Berezovsky claimed to have been the mastermind behind picking a man with no public face, a former K.G.B. agent, to succeed Yeltsin as the president of Russia. He also said it was his idea to manufacture an entire nonideological pseudo-political pseudo-movement to serve as the new president’s base of support. Berezovsky also had another brilliant idea, which to his regret Putin did not grasp: creating a fake two-party system, with Putin at the head of a socialist-democrat sort of party and Berezovsky leading a neoconservative one, or the other way around.”—
“I never know when to call people anymore. It’s like a skill that I’ve lost. During the day, no one is home because everyone is at work. And at work they’re too busy to talk. Or, if they don’t work, they’re at lunch all day. Around other people. Talking on the phone would be rude. At night, it’s dinner time. Or their favorite show is on. Or they’re in bed already. Maybe because we don’t call people anymore we’ve just squeezed out the opportunity for phone calls altogether.”—A note I wrote to a friend today.
In which Felix Salmon and John Carney solve the debt-ceiling problem over IM
John Carney:Am I the only person in the world who likes the debt celing?
John Carney:I can't find anyone else defending it.
Felix Salmon:Oh, stop being all #slatepitchey
John Carney:I'm serious. I think the debt ceiling is actually a necessary thing. Getting rid of it would be terrible.
John Carney:But I do think we'll get rid of it
Felix Salmon:OK, let me spell this out for you
Felix Salmon:Every time we hit the debt ceiling, there's a low but non-zero chance that we will default
Felix Salmon:We hit the debt ceiling quite often
Felix Salmon:Therefore, statistically speaking, eventually we're bound to default. Sooner or later.
Felix Salmon:For no good reason
Felix Salmon:This is sheer idiocy
John Carney:One: we're not bound to default since the United States won't exist forever. So the time span isn't infinite.
John Carney:But, seriously, having the debt authorized by Congress is important because that makes it Our Debt and not Obama's Debt.
John Carney:Bonds issued in defiance of a congressional majority would provoke a crisis.
Felix Salmon:The US is the only republic in the world that has a debt ceiling. All the others seem to cope just fine without the legislature signing off on every bond issue.
John Carney:So, here's the thing, you can't get around Congressional authority on this entirely because its in the constitution. So you're stuck with giving congress a say. The question before us is whether the president should have the power to raise it even if a congressional majority rejects the rise.
John Carney:That's what Geithner has proposed. In which case, we could very easily have the Treasury issuing bonds that have been rejected by a congressional majority.
John Carney:That has never happened before in US history. It's not something that I'm aware has happened, in fact, in any developed country.
Felix Salmon:Look, the easy thing to do here is to just have Congress pass a $100 quadrillion debt ceiling.
John Carney:Sure. That sounds like a better idea, actually, than attempting to move the debt ceiling into the White House.
Felix Salmon:Yay! Thesis, antithesis, synthesis! We solve the world through IM!
Una Neary, tapped yesterday to become one of the newest partners at Goldman Sachs, is not one of the best-known executives at that storied investment bank.
But there is one place in New York City where everybody knows her name—the Upper East Side high-end Irish pub named “Neary’s.”
The place was opened on Saint Patrick’s Day in 1967 by Una’s father, Jimmy Neary, who immigrated to New York from Sligo, Ireland in 1954 and still can be found at his namesake establishment greeting customers almost every evening. Una, the eldest daughter of Jimmy, was born a couple of years later and worked there as she grew up, alongside her sister Ann Marie and mother Eileen.
“Una was practically raised here,” one long-time regular said.