Quote:
Originally Posted by TracyCoxx
And Washington is now acting surprised. Idiots.
|
The U.S. Department of the Treasury and many in Congress are disputing S&P's math, a fact that should be included with any statement about what S&P has done. Further, S&P -- in taking this decision -- calls attention as much to the political process as to anything specifically financial. In other words, it is a reasonable assumption that had the Tea Partiers not manufactured a debt ceiling "crisis" for political purposes, out of thin air, there would have been no such action.
Notably, neither Fitch nor Moody's, the other two main credit ratings agencies (Moody's being generally regarded as the most important), have downgraded their ratings. Both continue to maintain the AAA rating for the United States after this week's debt deal, although Moody's lowered its outlook on U.S. debt to "negative."
The $1 billion extra in interest it may now cost the United States to borrow money that it MUST borrow to pay for spending already approved by Congress -- including by Republicans -- is $1 billion that could have been spent on making life better for Americans. Instead, it will go to banks and other lending institutions. So, the Tea Partiers get the best of both worlds, from their perspective: they held the government hostage to a phony debt ceiling crisis that resulted in some cuts they wanted, and they get more money to their real, significant backers. In other words, more money for the wealthiest bankers and others who control the flow of capital.