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national association of government employees
Watchdog Slams Biden DOJ's Push to Preserve Debt Ceiling as Another Crisis Looms
"Why is the Biden administration trying to rob itself of a clear opportunity to protect American workers and the economy from being roiled by MAGA saboteurs?" asked the head of the Revolving Door Project.
Aug 10, 2023
A government watchdog on Thursday called out the Biden administration for attempting to kill a lawsuit filed in May by a union representing about 75,000 workers across U.S. agencies that challenges the federal debt ceiling law.
"Why is the Biden administration trying to rob itself of a clear opportunity to protect American workers and the economy from being roiled by MAGA saboteurs?" asked Jeff Hauser, executive director of the Revolving Door Project.
A federal judge canceled plans to hear arguments for the National Association of Government Employees (NAGE) case when President Joe Biden and congressional Republicans who were holding the economy hostage announced a negotiated deal to suspend the nation's borrowing limit until 2025—signed into law in early June as the Fiscal Responsibility Act (FRA).
Biden then ordered his aides to create a working group intended to prevent similar crises in the future. As the White House said last month, "Now that the latest debt ceiling crisis is behind us, it is necessary to explore all legal and policy options to prevent Congress from ever again holding hostage the full faith and credit of the United States."
Now, as Government Executivereported earlier this week, even though "federal employees are still facing the prospect of delayed paychecks when the debt ceiling is reinstated in 2025," the U.S. Department of Justice "asked Judge Richard Stearns of the U.S. District Court for the District of Massachusetts to dismiss the case, suggesting the FRA has made the case moot and NAGE members lack standing because their claims are 'wholly speculative.'"
"After calling for just such a case to be brought, the Biden administration now fights it, demonstrating a truly remarkable willingness to shoot itself in the foot."
Hauser said that "the Justice Department's notion that the federal employees' claims of injury are 'wholly speculative, as they depend on a future chain of events that may never occur,' is absurd: The crisis is scheduled to recur precisely on January 1, 2025, as it has recurred repeatedly this century."
"In the meantime, uncertainty continues to trouble hundreds of thousands of federal workers, who have no guarantee of how their jobs, salaries, and pensions will be affected," he noted. "Indeed, the stance that [Attorney General] Merrick Garland's Justice Department is advancing creates an unfortunately sound case against workers considering taking a job in what has become an unstable federal government."
During the drawn-out fight earlier this year, as Republicans in Congress signaled their willingness to force the first-ever U.S. default despite warnings of a resulting economic catastrophe, Biden even suggested that while he wasn't planning to invoke the 14th Amendment—which states that the validity of the nation's public debt "shall not be questioned"—to end the current crisis, he would be open to challenging the debt ceiling law in the future.
"Rather than use the existing case as a means to that end, however, the administration is seeking to have it dismissed. The Justice Department declined to weigh in further on the merits of the case, reducing its argument only to the union's lack of standing," Government Executive explained, noting that a hearing on the motion to dismiss the case is set for August 29.
Hauser said that "after calling for just such a case to be brought, the Biden administration now fights it, demonstrating a truly remarkable willingness to shoot itself in the foot."
"The administration has every authority to take a different tack in this lawsuit and make space for the constitutionality of the debt limit to be worked out in the famously slow-moving U.S. legal system before the clock runs out on preventing the next crisis," he stressed.
The NAGE complaint names as defendants Biden and Treasury Secretary Janet Yellen in their official capacities.
Biden is seeking reelection next year and is expected to face the Republican nominee; former President Donald Trump is currently leading a crowded field of GOP candidates in spite of his legal issues, including the recent indictment related to his efforts to overturn his 2020 loss, which led to the January 6, 2021 attack on the U.S. Capitol.
Even if Biden wins in 2024 and Democrats keep control of the Senate and regain a majority in the House of Representatives, they may lack the votes needed to extend the suspension or raise the debt ceiling in early 2025. Democratic lawmakers notably declined to take action on the borrowing limit after the last midterm elections, despite warnings that Republicans would use their House takeover this year to hold the economy hostage to extract concessions.
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US Judge Sets Hearing for 14th Amendment Case on Eve of Debt Limit X-Date
While a DOJ attorney declined to disclose the government's position, one observer said it seems to be: "Stop trying to make us... get rid of the debt ceiling. That sort of thing is for high-level insiders only, not pesky labor unions that are going about it all wrong."
May 23, 2023
With a "significant gap" remaining between what House Republicans and White House negotiators want to resolve the debt limit fight, a federal judge on Tuesday scheduled a hearing next week for a related lawsuit brought by a union for government workers.
Attorneys for the National Association of Government Employees (NAGE)—which represents about 75,000 workers across federal agencies—sued President Joe Biden and Treasury Secretary Yellen in the U.S. District Court for the District of Massachusetts earlier this month. The union's legal team requested emergency action by the court in a filing on Friday.
During a Tuesday videoconference, Judge Richard Stearns gave the U.S. Department of Justice (DOJ) until May 30 to file a response detailing the department's position on presidential authority relating to the public debt and scheduled a hearing for May 31—the eve of the so-called X-date, or when Yellen warns the government could run out of money.
While NAGE wants a decision from the court before the X-date, Stearns, an appointee of former President Bill Clinton, "sounded skeptical of arguments from the union's lawyers that disaster for the nation is impending if he did not put the case on an even faster track," according toPolitico.
"If the emergency is as dire as you think it is, I would think that it's within the power of the president to address it using executive branch authority," the judge said. He added that "I understand there are time constraints, given that events are developing probably even as we're meeting, that probably make a decision prior to June 1st impossible."
Politico also noted that during the conference, DOJ lawyer Alexander Ely declined to disclose the department's position on whether the 14th Amendment's declaration that "the validity of the public debt of the United States... shall not be questioned" means the president can disregard the debt limit on constitutional grounds.
\u201cAs I read this, the government's position in the suit is:\n\n"Stop trying to make us to get rid of the debt ceiling. That sort of thing is for high-level insiders only, not pesky labor unions that are going about it all wrong."\n\nAh, the eternal cry of elites against activists.\u201d— David Rosen (@David Rosen) 1684867753
Thomas Geoghegan, an attorney for NAGE, said that "what we're faced with, I fear, is that the government doesn't really have a position on this, but there is no time to prevent irreparable injury."
As Common Dreams reported Monday, Revolving Door Project executive director Jeff Hauser argued that not only should U.S. Attorney General Merrick Garland "refuse to defend the unconstitutional legal incoherence that is the debt ceiling," but also the DOJ should "file papers supporting the National Association of Government Employees' request, and should do so as soon as possible."
"NAGE's argument is sound," Hauser said. "While President Biden may be willing to keep channels open until the very last minute with nihilistic, bad-faith Republican lawmakers, the Justice Department's obligation is to the Constitution, which is unequivocal."
The American Prospect executive editor David Dayen—who has been closely following the case—noted on Twitter that the DOJ and NAGE's formal request for the Tuesday conference states that "defendants intend to file an opposition to plaintiff's emergency motion for preliminary injunction."
Law Dork's Chris Geidner responded that "it's not necessarily opposition to the underlying arguments. It's possible that their opposition is either to a court ordering this or employees, through litigation, ordering them to do so. I'd think it would be unusual for any executive to argue otherwise."
The Tuesday conference came as the head of another union representing federal workers sent a letter to the White House.
"Many federal agencies that deliver services directly to the public, like the Social Security Administration, are already at the breaking point from years of inadequate funding," American Federation of Government Employees national president Everett Kelley wrote to Biden, warning the House GOP's proposed spending cuts "would be an economic and humanitarian calamity."
"I urge you not to yield to threats but instead to heed the advice of many legal scholars who have concluded that you have the inherent power, and indeed the duty, to avoid a default under the Constitution's 14th Amendment," Kelley added. "You have additional authorities to mint platinum coins under 31 USC § 5112. Please use these authorities now before it is too late."
As Matt Bruenig, president of the think tank People's Policy Project, highlighted in a blog post Tuesday, minting the coin isn't Biden's only option—he could also have the Treasury "issue bonds with a face value of $0 that only paid its holders a set amount of interest each year for a certain number of years. In this scenario, people would still buy the bonds in order to receive the interest, but there would be no principal and thus no face value."
"My current thinking on the best way for Biden to deal with the debt limit is to sell zero-principal bonds," Bruenig wrote. "These would not count as debt under the wording of the debt limit statute because they have a $0 face value. If this was challenged, then the administration has three different defenses to the challenge: that zero-principal bonds do not contribute to the debt limit, that the debt limit is unconstitutional, and that illegally selling bonds is no more unconstitutional than illegally raising taxes, selling assets, or cutting spending.
"But whichever course of action Biden chooses," he concluded, "we should be clear that he has other options than agreeing to crack the whip against America's poor."
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Federal Workers Union Urges Biden to Reject GOP Austerity, Invoke 14th Amendment Over Debt Limit
"I urge you not to yield to threats but instead to heed the advice of many legal scholars who have concluded that you have the inherent power, and indeed the duty, to avoid a default," wrote AFGE's leader.
May 23, 2023
A union leader representing over 750,000 government employees on Tuesday pressured U.S. President Joe Biden to reject congressional Republicans' demands for spending cuts in exchange for raising the debt ceiling and to avert an economically devastating default by invoking the 14th Amendment to the Constitution.
As Treasury Secretary Janet Yellen has continued to warn that the federal government could run out of money to pay its bills as early as June 1, some legal scholars and progressive lawmakers have encouraged Biden to combat the GOP's economic hostage-taking by invoking the section of the amendment which states that "the validity of the public debt... shall not be questioned."
The American Federation of Government Employees, AFL-CIO (AFGE) joined those calls on Tuesday, with national president Everett Kelley writing to Biden to call for "unilateral action to ensure that the government continues to pay its bills and fulfill its obligations after the Treasury exhausts all extraordinary debt measures within the next several days."
"Our union members are the doctors, nurses, firefighters, border patrol agents, corrections officers, federal police, food safety inspectors, transportation security officers, and other public servants who keep the government running around the clock," Kelley noted. "They served tirelessly throughout the pandemic, defending the public, often at great personal risk. More than a few gave their lives to their country. It would be unconscionable now to agree to a budget deal that once again sacrifices their well-being on the altar of fiscal austerity."
"We urge you not to agree to spending caps because, inevitably, they undermine the ability of federal agencies to carry out their missions."
"We urge you not to agree to spending caps because, inevitably, they undermine the ability of federal agencies to carry out their missions and result in further unwarranted cuts to federal jobs and compensation," the union leader stressed, taking aim at a key demand of House Speaker Kevin McCarthy (R-Calif.) and fellow Republicans, who passed their so-called Limit, Save, Grow Act late last month.
Noting that "many federal agencies that deliver services directly to the public, like the Social Security Administration, are already at the breaking point from years of inadequate funding," Kelley warned that they "can in no way withstand further budget cuts of the magnitude proposed by House Republicans in the morally bankrupt 'Limit, Save, Grow Act.' This bill, even in the most diluted form, would be an economic and humanitarian calamity."
"Clearly a default must be avoided at all costs," he added. "I urge you not to yield to threats but instead to heed the advice of many legal scholars who have concluded that you have the inherent power, and indeed the duty, to avoid a default under the Constitution's 14th Amendment. You have additional authorities to mint platinum coins under 31 USC § 5112. Please use these authorities now before it is too late."
Before returning to Washington, D.C. to continue negotiations with McCarthy, Biden told reporters on Sunday that "I think we have the authority" to invoke the 14th Amendment but given the potential for a legal challenge," the question of whether it could be done in time to prevent a default "is unresolved."
\u201cQ: "It sounds like the White House is now ruling out invoking the 14th Amendment as an option to get around the debt ceiling. Is that accurate?" \n\n@PressSec: "It is not going to fix the current problem that we have right now..."\u201d— CSPAN (@CSPAN) 1684871442
Politico reported Friday that some Biden aides worry that "even the appearance of more seriously considering the 14th Amendment could blow up talks that are already quite delicate," and actually doing so could "trigger a pitched legal battle, undermine global faith in U.S. creditworthiness, and damage the economy."
Kelley's letter came as a federal judge scheduled a debt limit lawsuit hearing for May 31, the day before the so-called X-date. That case—filed by another union, the National Association of Government Employees, against Biden and Yellen—cites the 14th Amendment and aims to have the debt limit statute deemed unconstitutional.
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