Guan’s blog

As the maintainer of didtheunitedstatesdefault.com, I was a bit worried when I saw the headline on Felix’s latest post. Here’s the core of his argument:

Right now, with the shutdown, we’ve already reached the point at which the government is breaking very important promises indeed: we promised to pay hundreds of thousands of government employees a certain amount on certain dates, in return for their honest work. We have broken that promise. Indeed, by Treasury’s own definition, it’s reasonable to say that we have already defaulted: surely, by any sensible conception, the salaries of government employees constitute “legal obligations of the US”.

Nope. No federal employee, contractor, or anyone else with a claim on the United States government, is promised to be paid from the Treasury in excess of appropriations. That’s clear from the US constitution, which provides that

No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law; and a regular Statement and Account of the Receipts and Expenditures of all public Money shall be published from time to time.

This provision has remained unchanged since the Constitution was adopted, so no federal worker could have been under any illusion that he or she was promised any amounts on any dates in return for anything, if appropriations have lapsed. Section 9 is implemented in part through the Anti-deficiency Act (ADA), which forbids federal and DC government employees from incurring obligations on behalf of those governments in excess of appropriations, or to accept voluntary services “except for emergencies involving the safety of human life or the protection of property,” because whoever provided those services might later have a claim for compensation. Section 1342 further states that

As used in this section, the term “emergencies involving the safety of human life or the protection of property” does not include ongoing, regular functions of government the suspension of which would not imminently threaten the safety of human life or the protection of property.

What is actually going on then? Some “essential” federal workers are, in fact, working, and they may expect to be paid when this is all over. Furloughed workers may also expect to be paid. But they have no legal claim to do so and their expectations do not constitute legal obligations of the United States.

If, contrary to what I claim here, some employees have nonetheless been promised to be paid for the period from October 1, then it would not only be unconstitutional to pay them: whoever made that promise violated a federal law, and could be fined not more than $5,000, imprisoned for not more than 2 years, or both.

Maybe they’ve been promised something that’s weaker than a legal obligation of the US, but that wouldn’t constitute a default. The US does make weird promises, the enforceability of which is hard to determine, from time to time. For example, the federal government backs the FDIC with the “full faith and credit” of the US government, but the FDIC itself writes on their website that

While any final conclusion on this matter rests with the Attorney General of the United States and ultimately with the courts, it is our opinion that Title IX of CEBA merely represents an expression of the intent of Congress to support the FDIC's deposit insurance fund should the need arise.

I would say that whatever promise has been made to the federal employees who are working or furloughed right now, it is weaker than the one made to depositors at federally insured depository institutions, since the employees cannot even point to a Sense of Congress statement.