U.S. President Barack Obama (C) speaks as outgoing Treasury Secretary Timothy Geithner (L) and Chief of Staff Jacob Lew look on during an event at the White House on January 10, 2013 in Washington, DC. (Photo: Getty Images)
WASHINGTON (TheBlaze/AP) -- Forget about the government minting a $1 trillion coin to "solve" its debt-limit crisis, as some pushed earlier this week.
Treasury Department spokesman Anthony Coley said Saturday that neither his department nor the Federal Reserve believes the law “can or should be used to facilitate the production of platinum coins for the purpose of avoiding an increase in the debt limit,” the Washington Post relates.
Some of President Barack Obama's allies have been promoting the coin strategy as a way to avoid yet another showdown with Congress.
The Washington Post has background:
The platinum coin idea gained some powerful adherents during the debt-ceiling crisis of 2011, but it really developed traction following the 2012 fiscal cliff deal, as politicians and economics writers realized that the country would, indeed, be facing another debt-ceiling crisis in a matter of months. A Twitter campaign by Joe Weisenthal, of Business Insider, and Josh Barro, of Bloomberg View, forced it into the conversation, and subsequent endorsements by Rep. Jerry Nadler (D-NY), Nobel Prize-winning economist Paul Krugman and former U.S. Mint director Philip Diehl gave it further legitimacy.
The government has reached its $16.4 trillion borrowing limit. By late February or early March, Treasury will run out of ways to cover debts and could begin defaulting on government loans.
White House spokesman Jay Carney says Congress has two options at its disposal: either pay the tab for its spending or send the nation into default, which would have serious economic consequences.
President Obama says he refuses to negotiate on the matter, as Republicans try to find ways to reduce future spending.
After Senate Majority Leader Harry Reid wrote a letter to President Obama Friday asking him to act on the debt ceiling "without congressional approval, if necessary," Senate Minority Leader Mitch McConnell released a statement of his own.
“Democrats are looking at everything from the ridiculous (printing a trillion-dollar coin) to outright abdication of Congressional responsibility. But avoiding this problem will only make it worse,” it read.