Following the Civil War, the 14th Amendment was adopted to secure citizenship for all natural born Americans, including former slaves. But a section of the Amendment is being proposed as an end-around for the debt ceiling and many radical leftists are encouraging the White House to use it instead of negotiating with House Republicans.
Every American needs to understand two things. First, invoking the 14th Amendment as a way to print more money to pay our debts without raising the debt ceiling officially would be the straw that breaks the camel’s back. In this case, the camel is the U.S. Dollar’s tenuous position as the world reserve currency. Second, most of those who are pressing Joe Biden to invoke the 14th Amendment are well aware that it would rapidly tank the economy.
In fact, they’re banking on it.
Would defaulting on our debts be bad? Absolutely. It may not be as bad as Treasury Secretary Janet Yellen and her team of progressive economic advisors have deduced; they believe (or at least state as their belief) that models show a U.S. government default would be catastrophic, sending most markets spiraling, driving up unemployment, shutting down businesses, and starting a chain reaction that results in fiscal carnage.
It would be bad. I’m not an economist but those I’ve consulted with think Yellen may be overstating the dangers. With that said, none of them were willing to go on record saying they thought Yellen was being overly dramatic, so my concerns have not been fully abated. They think she’s overstating but they wouldn’t bet on it. As one conservative economist told me, “I’m not planning for the apocalypse but I did move portions of my portfolio to gold, just in case.”
A default would be bad and might be very bad. Invoking the 14th Amendment would be very bad in the best-case-scenario. Moves across the globe for de-dollarization have been rapid and spreading. This has been in-progress for a while, prompted by BRICS nations’ desire to end U.S. Dollar hegemony, then exacerbated by “bully” tactics against Russia at the start of the Ukraine War. It wasn’t just Russia that took notice of how SWIFT was weaponized. Other nations watched disapprovingly and began looking for alternatives.