Standard and Poor's downgrades US to AA+

[Danzig]

http://www.slate.com/id/2301171/

S&P Is Right. It's Congress' Fault.
The politics of sovereign-debt ratings downgrades.
By Annie Lowrey
Posted Monday, Aug. 8, 2011, at 3:47 PM ET

an excerpt:


In its note, the ratings agency does raise questions about the United States' long-term fiscal stability. In a world in which one party refuses to raise taxes—any taxes at all—balancing the budget in a reasonable timeframe becomes very, very difficult. It means enormous cuts to defense and safety-net programs and to investment in infrastructure, education, and research. That does not mean good things for growth.

and further down:

But Washington threatened a debtpocalypse, if not a default, for 11 excruciating weeks. Despite clear signs that the debt-ceiling impasse was hurting the economy, policymakers insisted on drawing the fight out until the very last minute. When it was all over, Senate Minority Leader Mitch McConnell promised to do it again the next time we need to raise the debt ceiling, and the time after that, and the time after that. We might be able to pay our debts, but it is far from clear that we will always be willing to pay them. Given all that, it hardly seems wrong for S&P to take our daft political climate into serious consideration.

[Riot]

Originally Posted by Danzig

Despite clear signs that the debt-ceiling impasse was hurting the economy, policymakers insisted on drawing the fight out until the very last minute. When it was all over, Senate Minority Leader Mitch McConnell promised to do it again the next time we need to raise the debt ceiling, and the time after that, and the time after that. We might be able to pay our debts, but it is far from clear that we will always be willing to pay them.

Yeah. We'll see how well that works for them in the 2012 elections. I think the "far right domestic terrorist" component of the right has had it's day in the sun, and the buyer's remorse is strong in many.

[Danzig]

one of the bloomberg guys said he is eagerly awaiting the wisc recall, that a republican smack-down there might put reps in dc on notice. guess we'll see.

[Danzig]

and speaking of the campaign:

http://www.msnbc.msn.com/id/44063660/ns/politics/

2012 campaigns and the downgrade effect
Keep an eye on 10 states with highest unemployment rates; Obama won six in 2008


The downgrading of U.S. government bonds by Standard & Poor’s has become a campaign-shaping event for President Barack Obama and whoever his Republican adversary turns out to be. In fact, it's ensured that the 2012 election will be fought on the battlefield of debt and unemployment.

The reverberation from that demotion means that Electoral College math (270 electoral votes needed to win) is now on a collision course with budget math (trillions of dollars in reduced spending and increased taxes), and labor market math (14 million unemployed).

Of the 10 states that now have the highest unemployment rates, Obama won six of them in 2008.

Four of them — Nevada, Florida, Michigan, and North Carolina — account for nearly a quarter of the electoral votes needed to win the presidency.


and further down, something i'm curious about:

Who will serve on new 'super-committee'? Might that committee produce the compromise that Obama seeks?

Here’s one test: Whether the committee includes at least one Republican who has supported increases in revenues — not necessarily achieved through higher income tax rates, but through a simpler, more efficient tax code — and at least one Democrat who has supported cuts in entitlement spending that go beyond those assumed in last year’s health care overhaul (which aims for about $500 billion in reduced Medicare outlays over the next ten years).

If the joint committee wants significant reductions in entitlements costs, it might need to rethink the Democrats’ landmark achievement of 2010: health care reform. For instance, starting in 2014, the health care overhaul expands Medicaid by 17 million beneficiaries (about a one-third increase), with $627 billion in new spending in the first ten years.

Former Wisconsin Sen. Russ Feingold, who flirted with running for the Democratic presidential nomination in 2008 and who now leads a group called Progressives United, told his supporters, “We must make sure the Democrats appointed by Harry Reid and Nancy Pelosi are willing to hold the line, insisting on new revenue and no cuts to Social Security or Medicare benefits.”

Obama didn’t use the word “cuts” Monday, instead offering the calming phrase, “modest adjustments to health care programs like Medicare.”

Loyal Democratic voters will be eyeing that committee to see if proposed Medicare and Medicaid cuts would indeed be “modest” or threatening to them.

...and that's my beef with obamacare above.. 'it saves medicare money' they yell 'it's wonderful'.

but look at medicaid. that's a $127 billion net increase in spending between the two.

[Riot]

Originally Posted by Danzig

one of the bloomberg guys said he is eagerly awaiting the wisc recall, that a republican smack-down there might put reps in dc on notice. guess we'll see.

I think they can win 2 or 3 out of 5 tomorrow, then get the 1 more Dem holding their seat at the next election, to retake the Senate (they need 3).

People on the far left are talking about "Progressive Spring" starting with Wisconsin, then spreading to Ohio and Florida (where ALEC and the RGA has been most active)

[witchdoctor]

From the horse's mouth

http://yourdaddy.net/2011/08/08/stan...dit-downgrade/

[clyde]

Everyone picks out what they want to believe.




That is more the problem.

[wiphan]

If these ratings companies are so good at their job and so credible then what the hell were they doing in 2005,2006, and 2007 when they were rating the mortgage backed securities AAA?