Jonathan Adler writes:
The Volokh Conspiracy » Is the Debt Limit Constitutional?: The Huffington Post reports that some Democrats are urging the White House to ignore the debt ceiling on the grounds that it is unconstitutional. The basis for this argument is Section 4 of the Fourteenth Amendment, which provides:
The validity of the public debt of the United States, authorized by law... shall not be questioned.
Under this provision, some argue, the federal government is prohibited from defaulting on its debt obligations. Therefore, the argument goes, the President could violate the debt ceiling imposed by Congress if necessary to pay existing obligations. This is an interesting argument, and one that is unlikely to be resolved by the Courts.... Were the White House to authorize the assumption of debt above and beyond that authorized by Congress, it is not clear that anyone would have standing to challenge this action in federal court. As a consequence, the question would be left to the political branches.
If administration X issued debt above the debt ceiling, then a subsequent administration Y could refuse to pay the debt on the grounds that it was not by law authorized.
The holders of the debt would then presumably sue for payment.
And then the courts would have their day.