Harry Reid told the U.S. president that he will support him if he decides to remain true to his promise not to negotiate with Republicans over the debt-ceiling.
The simplest escape way out of the debt ceiling impasse is for the president to direct the Treasury to find a legal way to pay its debts, explains The Huffington Post.
“In such case, the Treasury has a variety of options,” the publication explains. “One gaining particular attention relies on a law that allows the Treasury to mint a coin of unspecified value and deposit it with the Federal Reserve. Those funds could then be used legally to pay debts.”
“Reid has not dismissed any option,” said the source familiar with the matter speaking on condition of anonymity.
According to the 14th Amendment, “the validity of the public debt of the United States, authorized by law … shall not be questioned.”
Last month, White House spokesman Jay Carney told reporters that “[t]his administration does not believe that the 14th Amendment gives the president the power to ignore the debt ceiling – period.”
On Monday, Senate Majority Leader again raised the 14th Amendment with President Obama in a conversation about the deal struck between Minority Leader Mitch McConnell and Vice President Joe Biden.
Reid predicted that the president would soon have to ask House Speaker John Boehner for a $2 trillion hike in the debt ceiling, and Boehner would likely demand drastic cuts.
“What do you do? You already took the 14th Amendment off the table,” Reid said, according to notes of the call.
The president assured Majority Leader that he simply would not negotiate over the debt ceiling. He didn’t elaborate.
“I’m not going to read out or confirm specific private conversations,” a senior administration official told reporters Friday.
He went on, adding: “But the president has said many times, publicly and privately, that his lawyers have concluded that the 14th amendment is not an option.”
The news comes soon after House Minority Leader Nancy Pelosi revealed to reporters that she would raise the debt limit unilaterally “in a second” if she were president of the country.
“I would do it in a second,” Pelosi said. “But I’m not the president of the United States.”
Meanwhile, a Republican Senate aide said in a statement: “We all know this deadline is coming. In regards to the CR vs the debt ceiling, a downgrade will likely occur if spending is not cut, not if Congress were to refuse to [raise the] debt ceiling temporarily.”
Friday morning saw Sen. John Cornyn, the second-ranking Senate Republican, making a similar argument.
“Republicans are more determined than ever to implement the spending cuts and structural entitlement reforms that are needed to secure the long-term fiscal integrity of our country,” he said in op-ed.
“The coming deadlines will be the next flashpoints in our ongoing fight to bring fiscal sanity to Washington.”
Cornyn concluded: “It may be necessary to partially shut down the government in order to secure the long-term fiscal well being of our country, rather than plod along the path of Greece, Italy and Spain. President Obama needs to take note of this reality and put forward a plan to avoid it immediately.”