The Associated Press reports that for the first time in history “Standard & Poor’s has lowered its long term outlook for the federal government’s fiscal health from “stable” to “negative” and warned of serious consequences if lawmakers fail to reach a deal to control the massive federal deficit.” While the credit agency did not lower the country’s AAA rating, the “negative” long term outlook is seen as a shot across the bow for the President and the Republican leadership. Fix this now or your credit rating WILL change.
Thank you, thank you, and thank you!
For the past decade elected officials from both parties have given lip service to the deficit and the long term financial Armageddon that lies ahead. They have been quick to raise the debt ceiling, borrow more money and worry about the aftereffects later. Iraq, Afghanistan, prescription drugs for seniors, bank bailouts, auto industry bailouts were all paid for with borrowed money. Everyone talks about the debt problem but no one has the political courage to do anything about it.
Now thanks to S&P they have no choice. Fix it now or the cost to borrow more money will destroy the country.
Critics have already started to dismiss the rating much as ado about nothing. The White House shrugs it off and says “we know… we were already working on it.” Others question the S&P’s credibility pointing out this is the same agency that gave bundled toxic mortgages AAA ratings right before they exploded and threw the country into a deep recession.
But their protestations don’t change the facts…the debt situation is a serious problem and if not fixed immediately the S&P’s AAA rating will disappear and the economy will go into a freefall.
Standard & Poor’s is merely saying what the American people have been saying for years. The US has had a debt crisis for the past decade. It has grown out of control over the past two years. S&P and the American people have no confidence that a remedy will be in place by the next election. While the American people can do little to fix the situation, S&P can.
We should all be outraged and embarrassed that that our elected officials have allowed this situation to reach this point.
We should also be pleased that someone with authority has finally stepped up to do something about it.
Our sincere thanks to the analysts at S&P.