There is a really lousy idea making the rounds of the chattering classes in Washington right now: that the 14th Amendment gives the President the power to take on debt beyond what Congress has authorized. What the 14th Amendment, Section 4, says is:
Section 4. 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. But neither the United States nor any State shall assume or pay any debt or obligation incurred in aid of insurrection or rebellion against the United States, or any claim for the loss or emancipation of any slave; but all such debts, obligations and claims shall be held illegal and void.
How does this authorize the president to borrow money, especially as the power “to borrow money on the credit of the United States” is one of the powers vested in Congress in Article I, Section 8? Good question. The 14th Amendment, declared ratified on July 9th, 1868, dealt with post-Civil War issues, and the clauses dealing with citizenship, apportionment, civil disabilities for anyone who had sworn an oath to uphold the Constitution and had subsequently engaged in rebellion, and the “incorporation” of the Bill of Rights, making parts of it apply to the states as well as the federal government, have generated a huge amount of Supreme Court jurisprudence.
Section 4 has not. Indeed, as far as I know, the only Supreme Court case dealing with it was Perry v. United States (1935), one of the so-called gold bond cases. Congress had passed a joint resolution saying United States bonds that were to be paid off in gold could be paid, instead, in ordinary money. The court ruled (5-4) that “We conclude that the Joint Resolution of June 5, 1933, in so far as it attempted to override the obligation created by the bond in suit, went beyond the congressional power.” But it also ruled the plaintiff had failed to show a cause of action and therefore had no standing. Case closed. Those of the Tea Party persuasion should read, for entertainment value if nothing else as the matter is now moot, the furious dissent of Justice McReynolds in this case. You can almost hear the steam coming out of his ears.
But Perry in no way questions the plain meaning of the section: that the enormous debt that had been run up to pay for the Civil War (the national debt went from $64.8 million in 1860 to $2.8 billion in 1866) as well as future pension costs were not to be questioned by anyone while the losses incurred by slaveholders and those who had loaned the Confederacy and Confederate states money (including some European banks and speculators) were not to be paid by anyone.
Any attempt to twist what is clear in plain English into a back-door grant of power to the president would, I suspect, cause a political and even constitutional problem far more severe than a short-term default would.