August 08, 2011

Another D O W N G R A D E Possible in Just Months

While our favorite trolls continue to sippy-cup and regurgitate whatever talking point excuses the lefty elites trot out to explain away Standard & Poor's downgrading of the U.S. credit rating from AAA to AA+, the credit agency warns again that if reckless government spending isn't reined in, our debt crisis may force them to lower our credit rating yet again.

The U.S.'s new double A+ rating "could go down more in a time frame of six months to 24 months," to double-A, depending on government action to cut the deficit, John Chambers, managing director and chairman of Standard & Poor's sovereign ratings committee tells FOX Business senior vice president and anchor Neil Cavuto in an interview on FOX News Saturday.

That means the U.S. government effectively has until at least February to find additional cuts to meet S&P's demand for at least $4 trillion in total deficit reductions over the next decade. The debt ceiling deal cuts $917 billion over the next decade and at least $1.5 trillion from a new bipartisan super committee in Congress by November.

For the first time in history, Standard & Poors downgraded the U.S.'s vaunted Triple-A rating to double A+ after the market's close on Friday night, a rating it has held at S&P since 1941.

You can repeat the basic economic facts on a middle school level as many times as you would like, and it will not matter.

Congress was given horrific power when allowed to spend without a requirement to balance the budget every year. We are now so deep in debt as a nation that there is no way—even with 100% taxation of the so-called "rich"—that we can ever raise taxes high enough to bring in enough revenue to offset spending. We must slash spending, and deeply, including the sacred cows of Medicaid, Medicare, and Social Security.

But progressive ideology demands followers to believe that:

  • Government is the best mechanism to accomplish _______.
  • If the _______ government program isn't working, providing more money to _______ is the solution.
  • There will always be enough money to fund _______, we just need to raise taxes to pay for it.

As a result, we will continue to hear blame-casting from the political left and would be elites. They would rather demagogue those arguing for fiscal responsibility (and call them terrorists) and drive the country into default than be forced into recognizing that a free market economy will not work with their demands for an massive, all-providing government.

It is really too bad that they have so little faith in the intelligence, initiative, and grit of the American people.

We will not only handle the needed deep cuts to big government; we'll thrive as a result.

Of course, that is precisely their biggest fear.

Posted by Confederate Yankee at August 8, 2011 08:40 AM

Now that teh Obama administration has shifted to its "best two out of three" policy WRT ratings agencies, everything is just fine. Have no doubt that teh other two will do as they are told. The only difference is that the people don't believe any more.

Posted by: Professor Hale at August 8, 2011 09:41 AM
We are now so deep in debt as a nation that there is no wayeven with 100% taxation of the so-called "rich"that we can ever raise taxes high enough to bring in enough revenue to offset spending.
At this point, I'm wondering if taxing everyone at 100% would be enough to offset spending. Even if it was enough, it would only work once, and would instantly destroy the entire economy completely.

I saw somewhere (and I don't remember where, now) someone pointed out that even if we cut actual spending (not reduce the increases, but actually cut current spending) by the $100 billion a year these "cuts" promise, it would still take 150 years to pay off the debt.

Bottom line: We are boned.

Posted by: Jake at August 8, 2011 12:10 PM