Laugh Test Failure

The Platinum Coin is a Weird Idea

01.07.13 3:12 PM ET

Paul Krugman today writes about the platinum coin idea, of which I'd reckon you've heard tell:

Republicans are openly threatening to use that potential for catastrophe to blackmail the president into implementing policies they can’t pass through normal constitutional processes.

Enter the platinum coin. There’s a legal loophole allowing the Treasury to mint platinum coins in any denomination the secretary chooses. Yes, it was intended to allow commemorative collector’s items — but that’s not what the letter of the law says. And by minting a $1 trillion coin, then depositing it at the Fed, the Treasury could acquire enough cash to sidestep the debt ceiling — while doing no economic harm at all.

This might be good economics, and it might even be the best available way out of this mess. But I don't see this working politically at all.

Can you imagine a president giving a prime-time, Oval Office address and saying, what we're gonna do, people, is mint a coin worth $1 trillion. That just doesn't pass any laugh test I can conceive of. I'd bet Obama would drop 12 points in the polls within five days of making such an announcement.

Krugman does raise the amusing question of whose visage should appear on such a coin, if minted. He suggests John Boehner. I say Geithner.