Wednesday, August 10, 2011

It's the Debt, Stupid

For the record, the downgrade of US debt was somewhat expected.  S&P warned about it in April after Obama gave a dispirited speech about "getting serious about debt".  Some think the timing is odd however since there is at least a plan in place to cut some spending (although modest) along with the congressional panels that will continue to address it next month (not next year).  And also since this is the same rating agency that all but blew the sub-prime mess.  Still one has to wonder what is S&P actually saying - and why are they criticizing the political process?   Some think it is to cricize the Tea Party - although that makes little sense since they are the only ones wanting to cut spending.  Others criticize the general nature of Washington and lobbyists to realize the entitlement balloon has to end.  In fact, it makes those politicians and scallywags who continue to call for tax increases look like economic buffons.  Adding insult to injury was Obama's inconsequential and non-presidential speech on Monday.  (FYI - read this excellent column detailing an inside view of the debt ceiling negotiations.)

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