14th Amendment emerges as last-ditch fix to ward off default

[onenote]

2. If the Court had to vote on the merits, they'd probably rule 9-0 against the use of the 14th.

I know that there are legal experts that think it can be used, as well as those that say it cannot. My take is that based simply on the plain language of the amendment, the stronger case is that it cannot.

The relevant language is found in Section 4 of the 14th amendment: "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"

The purpose of the amendment was to prevent the repudiation of certain public debt as well as to prevent public debt being incurred for certain purposes.

The key word is "validity". Failing the raise the debt limit results in a default on certain obligations, but not the repudiation of them or a declaration that they are illegal and void, i.e., not valid debts. Put in more mundane terms, when one defaults on a home mortgage, the debt doesn't become null and void (or "invalid" ) and the home owner continues to owe the money; similarly, if you default on a car loan, the loan isn't declared invalid, it simply opens the owner to repossession (assuming the car is collateral on the loan ). Debts incurred by the US are not secured by typical collateral, but that doesn't change things. Credit card debt generally isn't secured by collateral, but if you fail to pay your credit card debt, it isn't rendered invalid -- it remains a valid debt that the credit card company can pursue.

I think the courts would look at this language of the 14th and distinguish defaulting on debts from repudiating them and declaring them unlawful. The FDR-era case that sometimes is cited is distinguishable because it involved an action repudiating a portion of a debt owed by the government (i.e., declaring it "invalid". )