The two bedrock structural principles of the Constitution are the separation of powers and a system of checks and balances. These are always in tension. The principle of separation of powers places with Congress the power to issue the public debt in the name of the United States: Article I, Section 8, cl. 1, states baldly: “The Congress shall have Power To . . . borrow Money on the credit of the United States.”

The power comes after the parallel grant to Congress to impose taxes. Together these two clauses are the main revenue drivers for the United States. Yet the current constitutional structure subjects any such debt issuance to a presidential veto that can be overridden only by a two-thirds majority in both houses of Congress. That number cannot be obtained at present, given the rough parity of power between the two parties.

The good side of this arrangement is that it divides power to avoid the risk of tyranny, as James Madison or Alexander Hamilton said in Federalist No. 51, by setting ambition against ambition. But there is also this downside: the constitutional structure creates what is commonly called a “bilateral monopoly,” where each side has a blocking power to any solution that purports to deviate from the status quo ante, which in this case is the unappetizing prospect of a US default on its debt obligations, fraught with uncertain consequences, if the two sides cannot agree on an acceptable compromise. The situation therefore resembles one which arises under the National Labor Relations Act (NLRA), which creates just this structure in the context of collective bargaining negotiations between a monopolist union and a recalcitrant employer. Each side is subject to a statutory obligation to bargain in good faith with the other, even though neither side is required to make any specific substantive concession. Needless to say, the absence of any device—e.g., compulsory arbitration—to force a deal leads to breakdowns in negotiations that can, and often do, lead to lockouts or strikes.