“Extraordinary Measures”

As you know, the United States government hit its debt ceiling limit late last week. The Treasury Department is now taking “extraordinary measures” to prevent a default. It can continue these “extraordinary measures” for several months. 

That means we’re heading toward a debt ceiling showdown, and, so far, neither side is backing down. 

Speaker Kevin McCarthy says no responsible parent would allow a child to keep maxing out his credit card while demanding a higher limit. But President Biden is refusing to negotiate. (Remember that when the media tries to blame House conservatives for a fiscal crisis.) 

There’s a small glimmer of hope for a potential breakthrough, but I’m not holding my breath that House Republicans by themselves can force major spending reforms. 

Meanwhile, some Biden officials and congressional progressives are floating the idea of preventing a default crisis by minting a $1 trillion platinum coin. 

At first glance this may sound insane. That’s because it is. Thankfully, Treasury Secretary Janet Yellen said that the Federal Reserve would never go along with that, mainly because it would actually create a crisis.

Minting $1 trillion coins does not solve a debt crisis. And if it could, why not create 10 $1 trillion coins? Better yet, just mint 100 $1 trillion coins and cancel all income taxes! If it’s that easy to create money, then why is the government taking ours? 

This bizarre notion is behind the left’s latest crazy idea known as modern monetary theory. 

Unfortunately, it’s essentially what the left has been doing on a smaller scale with its massive COVID bailouts and big spending bills. From the American Recovery Act to the Inflation Reduction Act, a trillion dollars here and a trillion dollars there -- Biden and his leftist allies in Congress may as well have minted platinum coins with each act!

Modern monetary theory suggests that the government can do this as long as it wants for as much as it wants with little to no impact on inflation. It makes the federal government the ultimate “cryptocurrency.” But it’s fiat money, made up money. 

It would be a total disaster if ever fully implemented with $1 trillion coins because the fraud would be too obvious to too many people.

But at some point, as the debt continues to pile up, you run the risk of more and more people realizing that the money in their pockets, in their bank accounts and in their retirement accounts is virtually worthless. They may rush to dump their dollars and grab anything that has some real value.