World News, May 28, 2023. 5th June is the deadline for resolving the US debt crisis approaches, Republicans and Democrats are running out of time to avoid default. Amidst the uncertainty, experts propose the issuance of a one trillion dollar platinum coin as a last resort to prevent default. This article explores the potential impact and feasibility of such a coin.
As the United States faces a looming debt crisis, Republicans and Democrats are struggling to reach an agreement to avert default. To prevent the country from defaulting and to safeguard the global economy, experts have proposed issuing a one trillion dollar platinum coin. While the Treasury Secretary has dismissed the idea, some officials in the Biden administration remain open to considering it. This article examines the implications and viability of issuing such a coin amidst ongoing negotiations between the two parties and the increasing pressure to raise the debt ceiling.
In this situation it is saying that One Coin can Save America from Default, The United States is running out of time to save itself from a debt crisis, and both the Republicans and Democrats are unable to reach an agreement to raise the debt limit before June 5. If a consensus on increasing the debt ceiling is not reached by June 5, America will default.
Since the United States is the linchpin of the global economy, its impact will also be felt on the global economy. In recent days, Republicans in the White House and Congress have indicated that the negotiations are moving in a positive direction. However, people are still skeptical.
In this situation, some experts and analysts have started discussing the idea of minting a platinum coin worth one trillion US dollars as a last resort to save the country from defaulting.
In essence, a law enacted in 1997 grants the US Treasury Secretary the authority to mint platinum coins of any denomination and value for any reason. Those advocating for minting platinum coins argue that if there is no agreement to raise the debt ceiling in Congress, the US government can use this method to cover its expenses and avoid default.
However, Treasury Secretary Janet Yellen has dismissed this idea. The Biden administration has also rejected considering any such alternative. Treasury Secretary Janet Yellen had said a few days ago, “In my opinion, it would be a gimmick.” However, some officials in the Biden administration have a positive view on this.
Meanwhile, the argument of some experts is that proposing the issuance of a one trillion dollar coin in negotiations with Republicans can be another arrow in the Democrats’ quiver.
On the other hand, Republicans are not agreeing to increase the debt limit and are demanding cuts in public spending. But if both parties do not reach an agreement by June 5, America will begin to fail in its payments. In that case, the government will mint a coin worth one trillion dollars at the government mint.
How can this coin be issued?
However, increasing the US debt limit has never been a solution. But the Treasury Secretary has the authority to issue special edition coins that can be purchased by the public.
If a decision is made to mint a platinum coin worth one trillion dollars, what will happen? Former Director of the US Mint, Philip N. Diehl, says, “They just need to write one trillion dollars on the coin and send it to the Federal Reserve.”
However, people can imagine that a platinum coin of such a high value would be quite large and heavy, but in reality, its value will be equivalent to a quarter dollar coin that can be kept in a pocket. Even though there is no need to write any zeros on the coin as it represents one trillion dollars, it would be sufficient to write one trillion dollars on the coin.
Now the question arises, why only a platinum coin when there is a need to determine the value by writing on the coin? In fact, according to US law, the use of platinum metal is mandatory for coins with a value exceeding $50.
Professor Rohan Grey from Willamette University, who came up with the idea of minting a one trillion dollar coin, says, “If you have to choose between bankruptcy and printing currency, what would you do? The executive cannot allow a default to happen.”
How did the idea come about?
In fact, the idea of issuing a one trillion dollar coin to avoid default was first proposed by Carlos Mucha, an attorney from Atlanta, in a blog post in 2010. Carlos learned that under the Currency Act of 1997, there was permission to mint platinum coins. He wrote in his article, “It is interesting that Congress can already authorize the Treasury to mint a one trillion dollar coin…”