Article I, Section 8, clause 2:
Evan Nibbe

Having this power to authorize the issue of definite obligations for the payment of money borrowed, the Congress has not been vested with authority to alter or destroy those obligations.

This addresses the inability of congress to determine that a debt obligation it authorized is null and void, or to force a reduction in that obligation. It actually bolsters my point that congress has no reason to not pay an obligation since it “CAN NOT” become insolvent and it will always have the means to pay such obligations. There is nothing in this wording that states that the congress “must” issue debt to create currency, although that is the result of a law that congress approved to make sure that the US remained in the bond business, which many economists question. Regardless, it is a law, not a judicial ruling, and the law can be altered or voided by any congress.

This ability to create the necessary currency to pay its obligations is why it would be extremely difficult for the currency to devalue, whereas having a currency that is pegged to a commodity or another currency depends upon an exchange rate or physical supply of a commodity, neither of which necessarily reflect the health of the economy or its ability to generate goods and services. Even when rating agencies downgraded our credit due to the refusal to raise the debt limit by Republicans the dollar only suffered a small blip as a result before smarter minds saw it as a non issue. This has become such a universal truth in global economics that the Chinese chose to peg their currency to the dollar at a fixed exchange rate to avoid any disadvantage they would suffer should we manage to weaken the position of our currency.

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