While some Democrats and political pundits are calling for a $1 trillion coin to pay off the nation’s debt, one Republican Congressman in seeking to make it illegal.
Oregon Rep. Greg Walden is planning on introducing a bill that would prevent a platinum $1 trillion coin from being minted.
“This scheme to mint trillion dollar platinum coins is absurd and dangerous, and would be laughable if the proponents weren’t so serious about it as a solution,” he said in a statement. “I’m introducing a bill to stop it in its tracks.”
Such a coin is legal through a loophole that allows the Treasury to create platinum coins in any denomination, though that provision was intended for use on commemorative coins. The $1 trillion coin was proposed to bypass Congress trying to prevent a debt limit increase. The national debt could be paid off with the coin.
“My bill will take the coin scheme off the table by disallowing the Treasury to mint platinum coins as a way to pay down the debt,” Walden’s statement said. “We must reduce spending and get our fiscal house in order.”
Despite the outrageous nature of creating money to pay off debt, the $1 trillion coin has earned support from economists such as Paul Krugman, Rep. Jerrold Nadler (D-N.Y.), a White House petition and a Twitter hashtag, #mintthecoin.
While it’s unlikely that President Obama would take the political risk of ordering the creation of the coin, the National Republican Congressional Committee has also taken action to combat the coin. They created their own petition to tell Obama that spending is the problem, and one that won’t be solved with one coin.
If the situation sounds ridiculous, that’s because it is. The coin has analysts concerned about the impact on the international market, as well as rampant inflation.
“It’s just a disguised new form of debt,” former Congressional Budget Office director Douglas Holtz-Eakin told Fox News. “This would say (to the markets) they cannot manage their finances as a nation, they’re down to gimmicky coins.”
