Minting a trillion dollar coin would be quite a final act for Treasury Secretary Tim Geithner, PHOTO: Reuters
Jay Carney, in his typical, say as little as possible way, implied that there is a non-zero chance that the Obama Administration will have the treasury print a trillion dollar coin to escape a debt ceiling fiasco. The White House has ruled out invoking the 14th Amendment to raise the debt ceiling, but when asked about the trillion dollar coin, Carney would only say that Congress ought to raise the debt ceiling, and "I would refer you to the Treasury" about the coin option.
It makes sense too: the Obama administration has said time and again that it will not negotiate on the raising of the debt ceiling, but it needs an out when the House inevitably replies that they will not raise the debt ceiling without spending cuts. Without some sort of workaround, the Obama Administration is ultimately at the mercy of Eric Cantor and his Tea Party pals, which didn't work out so well last time.
Some Republicans have intimated that they would be okay with a government shut down to get the spending cuts they desire, whereas the Obama Administration would gain nothing from this, so that gives House Republicans leverage. Obama needs to counter that leverage with something, and that something, well, it doesn't have to be heavy, just very expensive. And make sure you don't lose it on the way to the federal reserve.