Thank You, Standard and Poor’s

After a few days of reading and reflection, this writer is now prepared to opine on the recent degrading of US credit.

In a statement released August 5, 2011, the credit rating agency Standard & Poor’s made financial history by being the first such company to lower the United States credit rating from the perfect AAA to the less-than-ideal AA+.  While pundits, politicians, and Americans still stumble through defining what, in fact, the outcome of this change will be, one is left to speculate that this may be the beginning of dark times in the American economic landscape.

Of course, it didn’t take long for the political establishment in this nation to respond.  The White House was quick to point out that, in their opinion if not in reality, S&P’s decision was based on fuzzy math.  True to form, the leaders of both Houses in Congress did not pass up an opportunity to take partisan political shots at the other party’s spending priorities.  Sen. Majority Leader Harry Reid (D-NV) stated that “[t]he action by S&P reaffirms the need for a balanced approach to deficit reduction that combines spending cuts with revenue-raising measures like closing taxpayer-funded giveaways to billionaires, oil companies and corporate jet owners” and chastised “hardliners who have already ruled out the balanced approach that the markets and rating agencies like S&P are demanding.”

House Speaker John Boehner (R-OH) also chimed in:

“This decision by S&P is the latest consequence of the out-of-control spending that has taken place in Washington for decades. The spending binge has resulted in job-destroying economic uncertainty and now threatens to send destructive ripple effects across our credit markets.

“Republicans have listened to the voices of the American people and worked to bring the spending binge to a halt. We are no longer debating how much to spend, but rather how much to cut. Unfortunately, decades of reckless spending cannot be reversed immediately, especially when the Democrats who run Washington remain unwilling to make the tough choices required to put America on solid ground.”

John Boehner’s quote is especially interesting since his Republican Party was the only one cited by name for promoting intransigence that led to a more negative projection of future spending controls.  While both parties were castigated in the S&P press release, the agency reserved a special admonishment for the Republican party and its insistence on not including any revenue rises.  Ever…:

“Compared with previous projections, our revised base case scenario now assumes that the 2001 and 2003 tax cuts, due to expire by the end of 2012, remain in place. We have changed our assumption on this because the majority of Republicans in Congress continue to resist any measure that would raise revenues, a position we believe Congress reinforced by passing the act.” (my italics)

While the S&P was very careful to walk the political minefield without scoring points or taking sides, portions like this show a clear connection between the development of a less optimistic fiscal assumption upon which the decision to downgrade was made and the Republican’s “resistance” to any revenue rises.  In a strange twist, it is the insistence on only spending cuts, an insistence Republicans assured Americans would be good for their economic future, that played a significant role in the decision to downgrade America’s credit.  It wouldn’t be too much of a stretch to state that S&P downgraded America’s AAA credit rating, in large part, because of Congress’ inability to raise revenues and create a more balanced, and therefore more effective, delevering scenario.

So today, this writer would like to thank Standard & Poor’s for the part it is playing in America’s future.  After all, this may be the first case of an “activist credit agency” trying to parlay its influence into more balanced fiscal policy and a less partisan, dysfunctional Congress.  Indeed, maybe (remember, this author said “maybe,” not “definitely”) Americans should be thanking S&P (up to the point where their interest rates go up, which this correspondent would argue is certainly cause for throwing tomatoes and other rotten vegetables) for giving post-partisan American voters ammunition to discuss the arrogant and self-serving actions of Congressional Republicans who have deemed that they, with control over only 1/3 of the houses of government, know better than the rest of America what citizens of this country want.

Further, the S&P decision has given the broader American citizenry ammunition to show how the general gridlock that dominates Washington, DC, and its political environment is harmful to America’s future.  It is up to all of us to make these points loudly across the American landscape, especially this month while your Congressional representatives are home relaxing in the midst of the worst jobs outlook since the 1930s.


This is What Democracy Looks Like?

An interesting clip in the New York Times this morning (“Disapproval Rate for Congress at Record 82% After Debt Talks”) reveals some fantastic information about the attitude of the American people towards their elected representatives in the Federal government:

  • “More than four out of five people surveyed said that the recent debt-ceiling debate was more about gaining political advantage than about doing what is best for the country.”
  • “Nearly three-quarters said that the debate had harmed the image of the United States in the world.”
  • “72 percent disapproved of the way Republicans in Congress handled the negotiations.”
  • “66 percent disapproved of the way Democrats in Congress handled negotiations.”
  • President Obama’s disapproval rating was 46%.
  • “The Tea Party is now viewed unfavorably by 40 percent of the public and favorably by just 20 percent.”

According to the article, the 82% disapproval rate for Congress is the highest it has been since the New York Times began asking these questions 34 years ago, and is even higher than when the Federal government actually shut down in 1995.

How can Americans feel this way without rioting in the streets over the outcome of these negotiations?  When three-quarters of voters disapprove of both parties, there is time for a change.  It is instantly clear that both Parties choose to serve their moneyed masters over the American Will.

The Crux of the Problem

And so, we emerge from a dark week in Washington, when many millions of Americans saw their greatest fear realized.  No, not a default on America’s credit.  This humble author believes such a default was never going to happen, and that this whole “crisis” was, to an extent, blown out of proportion by the mainstream media for political purposes.  Rather, Americans’ greatest fear was that their desires would not be considered by the elected officials who approve bills and sign laws in this country.  Example: in a recent CBS poll conducted before the deal was struck, that 66% of all Americans, including 55% of Republican voters, believed the deal should include both spending cuts and revenue increases.

How did we get the deal we did in the face of numbers like that?

The crux of the problem is that the government we’ve elected is not interested in compromise.  Consider the words of Senate Minority Leader Mitch McConnel (R-KY) from the floor of the Senate, as discussed in this recent Mother Jones article by Andy Kroll (“Man, That Debt Ceiling Fight Sucked! Let’s Do It Again!”): “[McConnel] … described the Republican tactic of refusing to raise the debt ceiling in order to extract favorable concessions as ‘a new way of doing business in Washington.'”

It would hardly be fair of me to reference McConnel’s words, and the actions of other Republicans like House Majority Leader Eric Cantor (R-VA) and the Tea Party caucus, who were willing if not hoping for the government to default as a way of proving their point / drowning government in a bathtub, Grover Norquist-style, without acknowledging that Democrats were equally complicit in the final deal.  After all, Democrats control the Senate and any legislation that is passed through it, and the President still holds the power of his office, at least for another few months, to sign or not sign legislation that he believes is or is not in the best interest of the country.  The action of Democrats like President Obama and Senate Majority Leader Harry Reid (D-NV) are starting to reveal a pattern.  The only question is, what pattern is it?  Is it a pattern of unwillingness to stand on principle (something Democrats have long been accused of, and something which may cost them electorally in the future as well as in the past) or a pattern of gleeful compliance with conservative principles?  This writer will allow for the remote possibility that Democrats believe $2 trillion in cuts with no revenue increases are in the best interests of the United States and her people.  If that is true, then the pattern they exhibit is one of willful dishonesty and hypocrisy.  This writer will reserve judgment on the Democrats at this time, while acknowledging that, to their credit, Republicans don’t pretend to believe that we should maintain a social safety net for the poorest, sickest or most elderly of Americans, nor do they pretend to believe in putting politics before their constituents.  Republicans deserve credit for being honest about their intentions, if nothing else.

And so, we finish where we started this morning.  As Andy Kroll suggests in the article cited above, this protracted budget fight is just one scene in a more complex space opera of political battles, electoral fights and conspiracy-laden, Citizens-United-fueled campaign attacks that will pepper our lives for the next 18 months.  The questions this correspondent will consider today are “what recourse do We the People have” and “who will stand up to all of it?”

A New Direction

Fellow Americans and Citizens of the Global Community.

In the wake of President Obama’s signing of the so-called “debt ceiling deal” this week, it has become evident to this writer that American Government continues to fail its people.  This latest incident, already hailed as one of the truly epic failures of opportunity in American history, serves to drive this point home further, like one more nail in a coffin.  The “deal” is being seen by the vast majority of Americans for what it is–an abandonment of any attempt to show the American people that the average citizen of this country still has even a vestige, even a splinter, of the influence over American Government that the average corporate board holds.  This new law represents Congress’ and the President’s unwillingness to continue to masquerade as a Government of, by, and for the People.  In fact, this law is so blatant in its disregard for social and economic justice, that its passage and signing insults us.  It is proof positive that the Government no longer believes Average Americans are smart enough to see what it has done, and no longer cares even if they are.

Today, we Move in A New Direction.

This weblog will be dedicated to the premise that American Government is not beyond saving, but rather can be restored once we abandon our need to justify its current actions and positions.  This site will promote the notion that American Government in its current form is broken, but not unfixable.  This writer, and the posts, articles, ideas, and comments shared here, will approach this growing American problem as one that can, in fact, be solved.  This will require viewing our situation from a new perspective, where party is irrelevant (if not part of the problem itself) and the mainstream media is complicit.

Come forward with your best dreams and hopes for this nation and real concepts for making them a reality.  Come forward with your real ideas for Solving America.