A trillion dollar coin idea has been floated as a way to wipe out the national debt, and while the idea of paying off the nation’s hefty tab by printing these coins sounds outlandish, many serious economists think it could work.
The idea for creating the trillion dollar coins has gained steam in recent days, thanks in part to a petition on the White House’s “We The People” site. The petition, which has already received more than 25,000 signatures, reads:
“With the creation and Treasury deposit of a new platinum coin with a value of $1 trillion US Dollars, we would avert the absurd-yet-imminent debt ceiling faceoff in Congress in two quick and simple steps! While this may seem like an unnecessarily extreme measure, it is no more absurd than playing political football with the US — and global — economy at stake.”
Those behind the idea want President Obama to reach out to the Treasury to ask that trillion dollar coins be printed, ABC News notes. A number of these coins would be put toward meeting debt obligations in case the new Congress fails to raise the debt limit.
It could actually work, the report notes:
“While there are laws in place to regulate how much paper, gold, silver or copper currency can be circulated by the government, there is nothing so clearly stated when it comes to platinum. That door open, the Treasury could have the U.S. Mint melt and mold a few trillion dollars of it, then ship the goods over to the Federal Reserve for safekeeping until the time comes to pay the bills.”
Jim Pethokoukis of the American Enterprise Institute blog says that while the idea may be plausible, the trillion dollar coin could be damaging to the national economy.
He says the effects it would have on the market are unclear, and he’d rather not find out what they are.