The trillion dollar coin that has been proposed to solve the government’s debt crisis would not be legal, the Treasury Department said Saturday.
Spokesman Anthony Coley said, “Neither the Treasury Department nor the Federal Reserve believes that 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.”
After the Treasury Department nixed the idea of minting the platinum coin, White House Press Secretary Jay Carney said, “There are only two options to deal with the debt limit: Congress can pay its bills or it can fail to act and put the nation into default.”
Carney also blamed Congressional Republicans for “playing politics” during negotiations over the borrowing limit in 2011. The inability to reach a decision led to the country’s credit rating being downgraded by Standard and Poor’s.
In the same statement, Carney said:
“The President and the American people won’t tolerate Congressional Republicans holding the American economy hostage again simply so they can force disastrous cuts to Medicare and other programs the middle class depend on while protecting the wealthy. Congress needs to do its job.”
The proposal to mint a coin that could decrease the nation’s debt had been floating around for awhile, but once it became clear that the US was close to heading over the “fiscal cliff,” the idea gained more steam. Economist Paul Krugman even used his column in The New York Times to push the proposal.
Friday, Senate Majority Leader and other Democrats urged President Obama to “take any lawful steps” to avoid putting the country into default.