I'll make this short and to the point.
The Eisenhower administration knew what to do in 1953, when the Treasury Department ran out of debt authorization, because the US Congress did not raise the debt ceiling then.
Sound familiar? Yep, we've been down this road before.
Please check out this article, folks: http://en.mercopress.com/...
There is more below the fold.
In order to keep making payments, the Treasury increased its gold certificate deposits at the Federal Reserve, which it could do from its dollar “profits” because the price of gold in dollars had risen. The Fed then credited the Treasury’s account with them, thereby increasing the Treasury’s cash balance. Treasury then spent the money without exceeding the debt limit.
According to Pollock and Canfield the US Secretary of the Treasury still is authorized to issue gold certificates to the Federal Reserve Banks, which will then credit the Treasury’s cash account. This is correctly characterized as monetizing the Treasury’s gold, of which it owns more than 8,000 tons. An old law says this gold is worth 42 and 2/9 dollars per ounce, but we know the actual market value is about 38 times that, at more than $1,600 per ounce.
By the way, the American Enterprise Institute (AEI) think-tank in "Washington political circles is considered close to the Republican Party as the Brookings Institute is to Democrats."
Yep, this is coming from a pro-Republican think-tank.
So Obama definitely needs to "buck-up." Yet he won't. That because he really does want to see Social Security, Medicare and Medicaid in the Tea Party dissection room. Even more than that, Obama wants the Bush Tax cuts to become permanent.
Ask yourself: Has there ever been a President who has governed so far away from his Presidential Platform?
I say that is again time that Obama demand a clean debt ceiling bill and settle for nothing else. What do you say?