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Could the nation’s debt crisis be solved by a single coin? Every day the U.S. gets closer to defaulting on its debt, the calls grow louder for a trillion-dollar solution.
In true fashion, The Simpsons got close to foreshadowing this exact scenario in a 1998 episode titled, “The Trouble With Trillions,” in which former President Harry Truman had printed a one trillion-dollar bill to reconstruct post-war Europe in 1945. The government suspected Mr. Burns had stolen it and asked Homer Simpson to investigate.
But let’s get back to real life. The “mint the coin” camp believes that a single platinum coin with a face value of $1 trillion could solve the country’s debt-ceiling issues in lieu of congressional action. While Congress technically holds the power of the purse, there is a legal loophole that allows the Treasury to mint platinum in any denomination without congressional approval.
The rule was intended for collectors’ coins, but theoretically, there’s nothing legally stopping the Treasury from stamping $1 trillion on it and depositing it into the Federal Reserve to pay debts. The platinum coin debate has been circling Washington for more than a decade.
“The debt ceiling is an absurd legal contrivance and we’re using another absurd legal contrivance to get around it,” Bloomberg Editor Joe Weisenthal said on the air back in 2013.
Weisenthal is still a very vocal proponent of the coin. But Treasury Secretary and former Federal Reserve Chair Janet Yellen is no fan of the scheme, telling the Wall Street Journal on Sunday that she doesn’t think the Fed would go for it. It’s not the first time she’s spoken out.
“I’m opposed to it and I don’t think we should consider it seriously. It’s a gimmick,” she told CNBC in 2021.
But it’s a so-called gimmick that gains traction every time Congress gets close to default.
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