>

What if The Debt Ceiling is Not Raised?

by Joseph M. Firestone, Ph.D, of Correntewire.  Joe is Managing Director and CEO of KMCI.org.

It’s only a couple of days now until August 2nd. Perhaps a compromise on lifting the debt ceiling will be reached before then. Perhaps none will be reached. Perhaps the President will veto a compromise if it doesn’t extend the ceiling sufficiently to support deficit spending until after the 2012 elections. If a debt ceiling extension is voted down, or if the President vetos an unacceptably small extension, then what is to be done? I’ve now run into six primary options the President can select among to avoid default. The six are:

– Challenging the debt ceiling based on the 14th Amendment Section 4
– Selective default
– Proof Platinum Coin Seigniorage (PPCS)
– Running an overdraft at the Fed
– The Fed burning its Treasury Bonds
– The “exploding option” plan

Let’s look at them in more detail.

1. The 14th Amendment option

This option is the most well-known one right now, having been discussed on the web at least since last Fall.

The 14th Amendment to the Constitution says in part:

“Section 4. The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned. . . . ”

People, including myself, have claimed that the debt ceiling is in conflict with the 14th Amendment and is therefore unconstitutional, and have called for the President to go ahead and issue more debt and wait for a legal challenge. That challenge may never come, because the House of Representatives alone will lack standing in the Supreme Court. In an article appearing today, at CNN, Jack Balkin offers an argument interweaving legal and political considerations, points out that the President would first have prioritize repayment of debt to conform to the Amendment, which might cause an inability to make Social Security payments fully and on time, creating great political pressure on Congress to pass a clean extension of the debt ceiling.

I’m not sure this analysis is entirely correct, since it may be possible for the Social Security Trustees to go to the Treasury with its Bonds, demanding payment for them so that Social Security payments can be made. Since the bonds are debt, and actually count against the debt ceiling, the President may not be able to hold up the payments. In any event, Professor Balkin continue his argument with:

Assume, however, that even a prolonged government shutdown does not move Congress to act. Eventually paying only interest and vested obligations will prove unsustainable — first because tax revenues will decrease as the economy sours, and second, because holders of government debt will conclude that a government that cannot act in a crisis is not trustworthy.

If the President reasonably believes that the public debt will be put in question for either reason, Section 4 comes into play once again. His predicament is caused by the combination of statutes that authorize and limit what he can do: He must pay appropriated monies, but he may not print new currency and he may not float new debt. If this combination of contradictory commands would cause him to violate Section 4, then he has a constitutional duty to treat at least one of the laws as unconstitutional as applied to the current circumstances.

This would be like a statute that ordered the president to hire 50 new employees provided that none of them is a woman. The second requirement violates the Constitution, so the president can hire the 50 employees and ignore the discriminatory provision.

Here the president would argue that existing appropriations plus the debt ceiling create an unconstitutional combination of commands. Therefore he chooses to obey the appropriations bill — which was passed later in time anyway — and ignores the debt ceiling. He orders the secretary of the Treasury to issue new debt sufficient to pay the government’s bills as they come due.

I’m not at all sure that the President will have to wait for a prolonged Government shutdown, to invoke the 14th Amendment: but whether he waits or invokes it on August 3rd, I think Balkin’s argument is too narrow in focusing only on the possibility that the President may invoke the 14th against the debt ceiling. Perhaps, for example, as my friend Beowulf suggests (in e-mail corrspondence), he could make “a flanking attack” on the Congressional limitation of $300,000,000 on Treasury printing US Notes? This limitation is older than either the debt ceiling legislation, or the current appropriations bill, and if he did challenge it successfully, then the Treasury would have its unrestricted power to create currency restored, a very powerful hedge against debt ceiling legislation, and an enabler for ceasing to issue debt at all.

2. Selective Default

The second option, is the Treasury declaring a selective default only on Federal Reserve-owned debt instruments in order to wipe these off the books, and create headroom relative to the debt ceiling. This is clearly an extra-legal procedure. The Federal Reserve Board of Governors is a Government agency; but those bonds are owned by the Fed Regional Banks, which in our system, are not Government agencies, but rather privately owned “Federal instrumentalities.” Here’s wikipedia:

“The Federal Reserve Banks have an intermediate legal status, with some features of private corporations and some features of public federal agencies. The United States has an interest in the Federal Reserve Banks as tax-exempt federally-created instrumentalities whose profits belong to the federal government, but this interest is not proprietary.[74] In Lewis v. United States,[75] the United States Court of Appeals for the Ninth Circuit stated that: “The Reserve Banks are not federal instrumentalities for purposes of the FTCA [the Federal Tort Claims Act], but are independent, privately owned and locally controlled corporations.” The opinion went on to say, however, that: “The Reserve Banks have properly been held to be federal instrumentalities for some purposes.” Another relevant decision is Scott v. Federal Reserve Bank of Kansas City,[74] in which the distinction is made between Federal Reserve Banks, which are federally-created instrumentalities, and the Board of Governors, which is a federal agency.”

Since the Bonds held by the Fed are held by the regional banks, this second option would involve a major hit to the assets of these banks and also an operating loss. It would involve not just questioning, but also denying a debt of the United States, and would therefore violate the 14th Amendment.

3. Proof Platinum Coin Seigniorage

Congress provided the authority, in legislation passed in October 1996, for the US Mint to create platinum bullion or proof platinum coins with arbitrary fiat face value having no relationship to the value of the platinum used in these coins. These coins are legal tender. So, when the Mint deposits them in its Public Enterprise Fund account at the Fed, the Fed must credit that account with the face value of these coins. This difference between the Mint’s costs in producing the coins and the credit provided by the Fed is the US Mint’s profit. The US code also provides for the Treasury to periodically “sweep” the Mint’s account at the Federal Reserve Bank for profits earned from these coins. Coin seigniorage is just the profits from these coins, which are then booked as miscellaneous receipts (revenue) to the Treasury and go into the Treasury General Account (TGA), narrowing the revenue gap between spending and tax revenues. Platinum coins with huge face values, $1, $1.6, $2, $3, $6.2, $15, and $30 Trillion coins have been mentioned, could close the revenue gap entirely, and, if used often enough, technically end deficit spending, while still retaining the gap between tax revenues and spending.

4. Running an Overdraft at the Fed

This option suddenly got some press this week as people begin to cast about for a solution. John Carney at CNBC says that overdrafts are more like “gifts” from the Fed than they are the kind of debt instruments the Fed is prohibited from buying from the Treasury, and that’s the gist of his argument. The problem with this argument, also quickly echoed by Felix Salmon is outlined by my friend Marshall Auerback in correspondence this way:

In the past, Treasury had access to both a cash and securities draw authority (hat tip, Cullen Roche of “Pragmatic Capitalism”). Intermittently between 1942 and 1981, Treasury was able to directly sell (and purchase) certain short-term obligations to (and from) the Federal Reserve in exchange for cash. Congress first granted this cash draw authority temporarily in 1942:

1. allowed it to lapse several times, and extended it 22 times until 1979, when it modified some of the terms and added controls.

2. In 1979, Congress also authorized a securities draw authority, which permitted Treasury to borrow securities from the Federal Reserve, sell them, and then repurchase the securities in the open market and return the securities to the Federal Reserve within a specified period.

3. The securities draw authority was never used. After Congress authorized Treasury to earn interest on its Treasury Tax & Loan (TT&L) account balances in 1977,

Congress allowed both draw authorities to expire in 1981.

That Congress allowed them to lapse would imply that it’s no longer operative . . .

In short, in 1981, Congress ended the Treasury’s drawing authority by allowing it to expire.

5. The Fed “Burning” its Treasury Bonds to Get Them off the Books

Ron Paul suggested this one. If the Fed agreed to the proposal, it would create at lead $1.6 Trillion in headroom between debt subject to the limit, and the debt limit. The proposal hasn’t been met with notable enthusiasm. In fact, I don’t think the Chairman has even dignified it with a reply. However, the objection to it is similar to the objection to Treasury declaring a default on its Fed-owned debt. The result would be a big whole in the Assets of the Fed Banks owning the debt instruments. They’re unlikely to support this proposal.

6. The “Exploding Option”

Jack Balkin presents the “exploding option” idea this way:

The government can also raise money through sales: For example, it could sell the Federal Reserve an option to purchase government property for $2 trillion. The Fed would then credit the proceeds to the government’s checking account. Once Congress lifts the debt ceiling, the president could buy back the option for a dollar, or the option could simply expire in 90 days. And there are probably other ways that the Fed could achieve a similar result, by analogy to its actions during the 2008 financial crisis, when it made huge loans and purchases to bail out the financial sector.

As near as I can make out, the idea here is for the Fed to pay for an option on the property, that it would not then exercise by some date certain. When the option expires, the Government, having an increase in the debt ceiling by then, would pay back the Fed, give it a small profit, and keep the property.

Presumably, this could be done indefinitely, if Congress has still failed to raise the debt ceiling by the end of the option period, or the option period could be made long enough that it is very improbable that the debt ceiling would not be raised. The “exploding option” idea is undoubtedly ingenious; but:

– I wonder whether the option isn’t functionally a debt instrument, and also whether
– the option isn’t being “monetized” by the Fed in complete analogy to the monetization of debt instruments that is expressly prohibited by Congress?

Comparison of the Alternatives

From my point of view, selective default and the fed burning its bonds are both far out options. I just don’t think the accounting rules governing the Fed would allow it to approve procedures that resulted in huge losses for the Fed regional banks. The Fed would never agree to such alternatives.

The overdraft and “exploding option” alternatives are likely to be much more acceptable to the Fed than options that destroy the financial assets of regional banks. However, both of these options are a bit legally questionable. As I said above, the overdraft procedure appears to have been ended by Congress in 1981, when it had every opportunity to renew the Fed’s drawing authority.

Felix Salmon is taken with the Fed allowing overdrafts. He thinks this solution is a realy elegant one because it would allow Treasury to keep on spending until it could arrive at a new debt ceiling. He also thinks that the Fed would have to honor Treasury checks by allowing an overdraft because if it didn’t do so, that would “trigger a massive recession” and violate the Fed’s full employment mandate.

I find this unconvincing because the Fed has been violating its full employment mandate since passage of the Humphrey-Hawkins during the 1970s. It has always taken its price stabilization mandate much more seriously than its full employment mandate. So, I think that the Fed may not honor Government overdrafts, because Government special drawing authority was ended in 1981.

The “exploding option” alternative is certainly inventive. However, if I understand it correctly, it’s a transparent artifice for allowing monetization of the functional equivalent of federal debt instruments. So, I think it’s legality is questionable, and that the President should be careful before he resorts to it.

In fact, the first four options being compared all propose procedures of questionable legality. All might turn out to be politically feasible, because the House Republicans may not be able to get standing to challenge the President. Nevertheless, if many representatives feel that the President’s solution to the debt ceiling problem is of questionable legality, and they also find themselves unable to get standing in Court, they may well feel justified in pursuing impeachment. They won’t get far, because the Senate will never sustain them; but nevertheless another impeachment circus is likely to be very costly for an Administration that wants somehow to improve the jobless rate before the elections of 2012.

This brings us to the Constitutional option. This is a legally fascinating option especially since the President might challenge the debt ceiling or other legislation such as the limits on Treasury printing money, or the legislation withdrawing the Treasury’s overdraft authority; It’s also a politically attractive option, because it makes the President look strong, relative to the House Republicans. It’s also interesting because if he issues a constitutional challenge and goes on issuing debt, it’s very doubtful that the House Republicans will have a practical legal route to contest what he’s done. On the other hand, as with some of the other options, their very inability to get redress from the law may goad them into attempting to impeach the President, and I suspect that the Administration would want to avoid that outcome, with all its distractions.

Coin seigniorage isn’t some crazy or radical idea, even though some who want to be considered Very Serious People (VSP) have had that kind of reaction to the idea. Instead, it is a legal instrument that the President may, depending on how things work out, have to use in a bit more than two weeks to comply with his oath of office. It may be the only way for him to avoid breaching one of the laws which he is supposed to enforce. As such, it has to be taken seriously, and treated with more than just a few dismissive conclusions, accompanied by a lack of explanation.

Many writers on the current debt ceiling crisis have been taking the view that the 14th Amendment constitutional challenge route is the best thing for the President to do if there is no agreement on the debt ceiling. But, a constitutional challenge requires violating the debt ceiling, or some other legislation, claiming that the chosen law is unconstitutional, and relying heavily on the House’s inability to have standing to take the President to Court in order to sustain the President’s action. The President may get away with this, but it is radical in the sense that it claims the Executive’s right to make a unilateral judgment of constitutionality in opposition to clearly written legislation, without getting a by your leave from the Supreme Court. Surely we can all see how dangerously radical this kind of practice is for the rule of law in the United States?

In other posts, I’ve made the case that the debt ceiling isn’t in violation of the 14th Amendment as long as PPCS is an option for the President. Also in an e-mail communication, beowulf, the blogger who wrote the seminal blog on coin seigniorage, offered the following opinion on why a 14th amendment-based challenge will not work, given the existence of PPCS.

. . . No federal judge — Supreme Court justices included — will take the extraordinary step of enjoining an Act of Congress if the President who asks them to had an opportunity to sidestep the constitutional issue lawfully but neglected to do so. . . . .

. . . The moral of the story is if the Court thinks there is no alternative to breaching the debt ceiling, it probably would find it unconstitutional (or rather, it would decline to hear the case on Standing grounds, leaving the President’s decision to ignore the debt ceiling in place). On the other hand, if the Court thinks the President had a lawful alternative– like coin seigniorage– but neglected to use it, they’re not going to bail him out.

This argument is compelling to me given the history of the Court. The Court defers to the legislature if it possibly can, and prefers the President to avoid constitutional challenges if he has a means of doing so. In this case, he does, and the means is proof platinum coin seigniorage.

Related Articles

Coin Seigniorage: One Solution to Debt Ceiling by Joseph M. Firestone

Debt Ceiling Debate Only Kicks the Can Down the Road by Steven Hansen

Weighing the Week Ahead: Debt Ceiling Deal – Just Do It! by Jeff Miller

Three Competing Theories by Van R. Hoisington and Lacy H. Hunt

Debt Crisis: A Look at Tax Reform Solution by Lance Roberts

USA Debt Crisis: Is There Any Truth by John Lounsbury and Steven Hansen

Gang of Six Proposal GEI News

Share this Econintersect Article:
  • Print
  • Digg
  • Facebook
  • Yahoo! Buzz
  • Twitter
  • Google Bookmarks
  • LinkedIn
  • Wikio
  • email
  • RSS
This entry was posted in Federal Reserve, Government, US Treasury, Uncategorized and tagged , , , , , , , , , . Bookmark the permalink.










Make a Comment

Econintersect wants your comments, data and opinion on the articles posted.  As the internet is a "war zone" of trolls, hackers and spammers - Econintersect must balance its defences against ease of commenting.  We have joined with Livefyre to manage our comment streams.

To comment, just click the "Sign In" button at the top-left corner of the comment box below. You can create a commenting account using your favorite social network such as Twitter, Facebook, Google+, LinkedIn or Open ID - or open a Livefyre account using your email address.





3 Responses to What if The Debt Ceiling is Not Raised?

  1. derryl says:

    I agree with Joe’s conclusion that coin seignorage is the most viable option in the event that the debt ceiling debate remains stalemated. I would go further and argue that this is an opportunity for the government to reassert its sovereign authority to issue its own money. 

    Michael Hudson, Steve Keen and others have argued convincingly that, over time, our system where banks create all the money as debt at interest becomes arithmetically unsustainable unless money supply grows exponentially along with the compound interest on all the debt. The RE bubble provided exponential growth of newly created mortgage money, but like all debt fueled asset bubbles it popped and money supply growth has gone flat or even negative. The deflation of asset prices has rendered the banking system and much of the household sector insolvent, owing more than their assets are worth. 

    What the system needs now is, according to the Austrian School, a good hard depression to bankrupt all the weak debtors and take down all the insolvent banks who lent unpayable sums to debtors. However, unless we also embrace social Darwinism and let all the losers die off in unemployed poverty, a depression will only further reduce government tax revenues and further increase welfare payments, making the deficit much worse than it is already. So Austrians: are you advocating social Darwinism or a massive expansion of the welfare state? Are you advocating creative destruction of the human losers, or a massive increase in national debt? I’ve never received a coherent answer to this question and I’m not expecting one now. 

    A more realistic way forward is Joe’s coin seignorage, which gives the government a way to add non debt money into the economy simply by using the new money to fund its deficit spending. I have advocated giving monthly sums directly to Americans to restore both household and banking system solvency together. But infrastructure reconstruction is another good candidate for ongoing injections of debt free money into the equation. As Warren Mosler points out, this allows infrastructure workers to “earn” incomes, which will resurrect consumer spending among other benefits. 

    Hudson and Keen argue that debt quantitatively exceeds money so it’s arithmetically impossible for debtors to pay. Kumhof and Ranciere argue that we have reached a distributional impasse where investors now own all the money and workers and consumers owe all the debt, and the era of investors lending evermore money so consumers can keep buying is over. 

    So either we have an absolute deficit of debt free money (i.e. “income”) in the system, or at minimum all of the money has accumulated in the hands of people who are not going to spend it. Unless “somebody” gets some non debt money into the hands of people who will spend it, consumer demand will remain weak, investment will not be viable, and the economy will not recover. 

    The government can provide this money by minting coins. I believe the addition of non debt money into this equation is the only kind of solution that could actually work. $2 trillion to fund current deficit spending would be a good start. 

  2. Thanks Derryl, that’s a fine comment, and would make a very good blog post. I agree with your analysis and would like to see a more detailed version of it.

    • derryl says:

      Joe,
      John suggested I turn this into an article so I did. It’s not in publishable form yet (links to your articles, etc. need to be added) but I will post it below. Also, in the July 29 GEI John published a related article laying out my thinking on the monetary-economic situation titled, “Vendor Financing and Fallacies of Composition”. That article is more about the human factors that generate imbalances, and my “distributional solution” to the current state of fatal imbalance between the possessors of money and the owers of debt. What I write below is more about how to make the money system work.

      I agree with Joe’s conclusion that coin seignorage is the most viable option in the event that the debt ceiling debate remains stalemated. I would go further and argue that this is an opportunity for the government to reassert its sovereign authority to issue its own money. In this regard we need to revisit the thinking of Irving Fisher. His 1936 pamphlet, “100% Money and the Public Debt”, the last thing Fisher published, is a crisp 24 page synopsis of virtually all his previous writing.

      100% Money lays out Fisher’s plan to replace fractional reserve banking with 100% reserve banking. Only the government would retain the authority to “issue” money. The government would lend this money to the banks at zero interest, and “each commercial bank would be split into two departments, one a warehouse for money, the checking department, and the other the money lending department, virtually a savings bank or investment bank.” Elsewhere Fisher observes that the public already believes banks lend out money they already have on deposit, when in fact bank loans are the creation of new deposits, so his 100% Money would simply convert banks into the financial intermediaries between savers and borrowers that people think they already are.

      Fisher writes, “One of the primary attributes of sovereignty is the monetary function. Professor Frank D. Graham points out that President John Adams considered any private issue of money a monstrosity and fraud on the public.” (see below for Thomas Jefferson’s view of this matter; and we all know how Andrew Jackson felt about predatory banking) Fisher continues, “In the very first article of our Constitution, it is written ‘Congress shall have power to coin money and regulate the value thereof.’ As has been seen we have neglected this provision by letting banks usurp a Government function.”

      Fisher believes the coinage provision applies to all forms of money issuance, but closer scholarship shows that the Framers themselves were divided on this matter and deliberately left out reference to non metal money. However, since the end of gold-dollar convertibility in 1971, the US$ has been a pure fiat money, which has value only insofar as the government honors it, which places authority over modern money squarely in the hands of the government. So functionally, if not explicitly constitutionally, issuance of ‘money’ per se is indeed a “government function” as Fisher believes. And proof platinum coinage, clearly authorized by an Act of Congress in 1996, and consistent with the explicit provisions of the constitution giving Congress the power to coin money and regulate the value thereof, is very clearly a legal government power.

      Fisher’s “debt deflation theory of depressions” is based on his correct understanding of banking, that banks create deposits by making loans, and destroy deposits when loans are called in or otherwise repaid or defaulted. “…the chief cause of both booms and depressions (is) the instability of demand deposits, tied as they are now, to bank loans.” His 100% Money would “take away from the banks all control over money, but leave the lending of money to bankers. …In short: Nationalize money but do not nationalize banking.”

      Fisher is certainly not alone in recognizing perverse effects of our present ‘bank-debt’ money system. Michael Hudson, Steve Keen and others have argued convincingly that, over time, our system where banks create all the money as debt at interest becomes arithmetically unsustainable unless money supply grows exponentially along with the compound interest on all the debt. The 1930s Depression saw money supply contraction, but look at a graph of money supply growth since 1946 and you will see a classic exponential curve.

      The 2000’s RE bubble provided the final vertical component of postwar exponential growth with newly created mortgage money, but like all debt fueled asset bubbles RE popped and money supply growth has gone flat or even negative. First, borrowers could not make their loan payments and the banks faced a liquidity crisis, which was solved by the Fed creating over $16 trillion of new money and guarantees to reliquify the international banking system. But the deflation of asset prices has rendered the banking system and much of the household and small business sector insolvent, owing more than their assets are worth, and the consequent economic depression has left the economy moribund and unable to endogenously grow its way back to health. In a fiat money system liquidity is easy to provide by adding keystroke money into bank account balances. Now we face the hard part, the solvency crisis.

      What the system needs now, according to the Austrian School, is a good hard depression to bankrupt all the weak debtors and take down all the insolvent banks who lent unpayable sums to debtors: the Andrew Mellon solution. However, unless we also embrace social Darwinism and let all the losers die off in unemployed poverty, a depression will only further reduce GDP and government tax revenues and further increase automatic stabilizers and other welfare payments, making the deficit much worse than it is already. So Austrians: are you advocating social Darwinism or a massive expansion of the welfare state? Are you advocating creative destruction of the human losers, or a massive increase in national debt? I’ve never received a coherent answer to this question and I’m not expecting one now.

      A more realistic way forward is Joe’s coin seignorage, which gives the government a way to add non debt money into the economy simply by using the new money to fund its deficit spending. I have advocated giving monthly sums directly to Americans to restore both household and banking system solvency together. But infrastructure reconstruction is another good candidate for ongoing injections of debt free money into the equation. As Warren Mosler points out, this allows infrastructure workers to “earn” incomes, which will resurrect consumer spending, which revitalizes business investment, among other benefits of putting people back to work.

      Hudson and Keen argue that debt quantitatively exceeds money so it’s arithmetically impossible for debtors to pay. Kumhof and Ranciere argue that we have reached a distributional impasse where investors now own all the money and workers and consumers owe all the debt, and the era of investors lending evermore money so consumers can keep buying is over. Investors comprise only 5% of the population so their consumption spending is too small to provide demand for the entire economy.

      So either we have an absolute deficit of money-to-debt in the system, or at minimum all of the money has accumulated in the hands of people who are not going to spend it. The spenders’ credit card is maxed out and defaulting. More liquidity to the banking system will not generate more loans to already overextended spenders. We are not in a simple downturn of the business cycle.

      We are in what Richard Koo calls a “balance sheet recession”. Koo advocates government becoming borrower and spender of last resort in this situation, where the private sector is deleveraging rather than taking on new debt so money supply and GDP are trying to deflate. Koo advocates the Japan model, but the single flaw in Koo’s argument is that without a restoration of real economic growth, government debt grows to infinity. Japanese, and indeed Western demographics generally (among many other headwinds facing the “developed world”), preclude the likelihood of a restoration of high GDP growth. Even with very low interest rates, in a GDP-flat economy where deflation is being prevented by ongoing government deficit spending, interest payments will eventually consume over 100% of government revenues. Game over.

      The only permanent solution to excessive debt is non debt money. Fiat money is just numbers in bank accounts. The only real solution to an excess of negative numbers is the injection of some positive numbers.

      More debt will not solve this debt crisis. Unless “somebody” gets some non debt money into the hands of people who will spend it, consumer demand will remain weak, investment will not be viable, and the economy will not recover.

      The government can provide this money debt free by minting proof platinum coins. I believe the addition of non debt money into this equation is the only kind of solution that could actually work. $2 trillion to fund current deficit spending would be a good start.

      “If the American People ever allow the banks to control the issuance of their currency, first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their fathers occupied. The issuing power of money should be taken from the bankers and restored to Congress and the people to whom it belongs. I sincerely believe the banking institutions having the issuing power of money are more dangerous to liberty than standing armies.”
      Thomas Jefferson, in an 1802 letter to Secretary of the Treasury Albert Gallatin