This “magic coin” idea, like the Death Star one, has thousands of supporters behind it as an online petition on the White House’s “We the People” petition venue.
“We would avert the absurd-yet-imminent debt ceiling faceoff in Congress in two quick and simple steps!” the petition states. “While this may seem like an unnecessarily extreme measure, it is no more absurd than playing political football with the US – and global – economy at stake.”
The $1 trillion coin could in theory give the Treasury fiscal breathing room. Rather than wait for Congress to approve more borrowing – and see the nation effectively default on its debt if Congress fails to do so quickly – the administration would employ the coin as a kind of bank account with the Federal Reserve against which the Treasury could draw.
Would it be legal and practical?
Well, technically, the law authorizes the Treasury secretary to issue commemorative platinum coins “in such quantity and of such variety as the secretary determines to be appropriate.”
Backers of the idea say the coin need not be large in size. It needn’t contain an amount of platinum that would actually be worth $1 trillion.
That doesn’t mean the idea would work, though. Many economists have publicly rejected the idea.