Standard and Poor's has just downgraded US credit from AAA to AA+. For the first time ever.. Let that sink in. For the first time ever. Ever.
We deserve it. Let's not waste time pretending we don't. After the sad spectacle of the last 6 weeks or so, the inadequacy of the outcome, plus our absymal deficit and debt, we deserve it. Let's skip the denial part. S + P isn't the only ratings agency that has taken this action, so shooting the messenger just doesn't work.
The United States credit rating has been downgraded because in the span of 11 years we have gone from a balanced budget to spending about $1.72 for every dollar we collect. The 2010 budget estimate figures show that we collected about 2.2 trillion dollars, and we spent 3.7. That's the problem, and the cause of this downgrade. The rest is static.
The soundbites in the immediate aftermath of the downgrade announcement should make it crystal clear to all Americans that the folks in congress are uncommitted to working together to address the issue. Or unable. The only thing either side seems eager to do is blame the other side for being unable to do the right thing. The debt council negotiations are certain to be a fiasco. I wish there was a way to bet money on it.
I'm convinced that the best way past this is for Americans to join together and sign our own pledges for the election of 2012. We should all promise to vote for every single non-incumbent congressional candidate (senate or house) that seems reasonable and promises to work outside the confines of partisan ideology to close the gap between government spending and government revenue by every means necessary.
Nothing will straighten up our alleged leaders better than an extremely loud shot across their bow. We need 60-70-80% turnover in the house and the ouster of most senators running for re-election. This institution needs an enema.
I think a high colonic is indicated in this case.
ReplyDelete"S + P isn't the only ratings agency that has taken this action, so shooting the messenger just doesn't work."
ReplyDeleteActually, it is, which is why it is doubly more controversial. There is no market consensus that US debt is a less safe investment.
This was a purely political statement by an agency who never owned up to their corrupt practice of rating subprime mortgage-backed securities AAA.
They aren't just a bearer of bad news. They are the ones making the claim that the US is a less-safe investment, on par with Belgium and New Zealand. This is to say, bullshit, and Nate Silver explains why in his thorough trashing of the S&P downgrade:
http://fivethirtyeight.blogs.nytimes.com/2011/08/08/why-s-p-s-ratings-are-substandard-and-porous/
You can make the credible argument for deficit and debt reduction without the masochistic "we deserve it," because that's just not the case.
We don't deserve to have our creditworthiness as a country questioned and arbitrarily cut down because a minority of zealots figured out how to hijack our government.
This move will now cost the US government tens of billions more in interest on its debt going forward when there is NO REASON we should have to borrow at higher rates, save for the fact that the know-nothing nihilists of the Tea Party have spooked everyone with their utterly reckless insanity.
Your recommendation to vote all the bums out is using a hammer to do the job of a scalpel. We know who needs to be voted out, and its not 80% of the House.
Its the very specific 20% that are now cheering the S&P downgrade as a victory.
http://www.youtube.com/watch?feature=player_embedded&v=Z1NagON189g
Thanks for stopping by Jack!
ReplyDeleteS+P is the only one of the three well-known domestic ratings agencies to downgrade. What I've heard oon CNN I think is that other lesser known global agencies already passed such a judgement, and it went unnoticed. No confirmed source for that, though, it was from memory.
------------
"You can make the credible argument for deficit and debt reduction without the masochistic "we deserve it," because that's just not the case.
We don't deserve to have our creditworthiness as a country questioned and arbitrarily cut down because a minority of zealots figured out how to hijack our government.
------------
That's the obvious conclusion if and only if you believe that the downgrade was exclusively or primarily driven by the debt ceiling debacle. I don't believe that. I think I made it quite clear why I think we deserve it, and congressional dysfunction is only one part of it.
______
"Your recommendation to vote all the bums out is using a hammer to do the job of a scalpel. We know who needs to be voted out, and its not 80% of the House."
______
Sorry, no. I think this actually is a job for hammer. A scalpel is too quiet. I think what we need is to get the largest number of Americans possible to send the loudest message possible TO BOTH PARTIES. Along with the voting out, we need the voting in of substantial numbers of independent reps. 3 in the senate and 10 or 20 in the house would go a long way.
I agree with you in principle that not every single member actually deserves to be kicked out. But I am not that troubled if a few folks who may deserve to stay get bounced. For one, such folks would probably be among the ones who endured anyway, even if my call really caught fire. And for another, I care more about loudly sending the message that this shit has to cease than I do about some congressfolks getting undeservedly ousted. And for a 3rd, there's a substantial sense in which all members congress should be held responsible for their collective utter failure.
Any effort that targeted say exclusively GOP tea party freshmen would both diminish the volume and send the wrong message. We can;'t keep sending the message that one party can act like a-holes and the only repercussion is that the other set of a-holes gets the baton back.
Again, thanks for stopping by.