Want a wild ride on the stock market? Here it comes! Who can we blame for the S&P downgrading of U.S. credit? S&P said the downgrade was not solely due to the amount of debt alone, but was also due to the failure of both parties coming together to create solutions going forward. So who would not come together? The Tea Party, that’s who. They refused to negotiate at every opportunity. It was their way or else.
The world is now reacting to the S&P downgrade with down markets in other countries. There is more to come and we will see some wild rides until the dust settles. The rest of the world cannot believe that members of Congress waited until the witching hour to raise the debt ceiling. This insane behavior does not happen in other countries.
U.S. Treasury Secretary Timothy Geithner said S&P made a $2 trillion error in calculating the debt analysis it presented and mistakenly went ahead with the downgrade anyway. One has to wonder if the downgrade was at all politically motivated. Also ask yourself how much credibility S&P has after it gave outstanding ratings to worthless debt before the housing collapse.
First of all, there is no debt “crisis.” That term was used by the Tea Party to connect the debt ceiling to draconian cuts in the budget. We have a lot of debt, yes, but it is not a crisis. The term debt crisis was picked up by the right-wing media and pundits and used constantly until it became perceived as real. You know, repeat something long enough and often until it becomes real. That is what they did.
This year, Congress did not routinely vote to raise the debt ceiling as it had every time in the past. This time was different because the newbie Tea Partiers, flexing their muscles, insisted the debt ceiling be connected to a vote on drastically slashing the budget. They flaunted their unwillingness to budge in interview after interview.
U.S. House of Representatives Speaker John Boehner (R-Ohio), in a last-ditch effort to get through the debt ceiling hurdle, presented a one-page item vote on it. That would have solved the problem, but the minority Tea Partiers rejected it. It became clear that the Tea Party, behaving like schoolyard bullies, were willing to throw the economy off the cliff unless they got their way. They thought it would be no big deal if we defaulted and picked up the pieces.
In this game of chicken, the Democrats saw they were crazy enough to do it and flinched in order to save the country and divert a total financial disaster. Luckily, they did. Otherwise, we would be waking up today to a crashed economy the likes of which we have never seen. We will still pay a costly price for their long delay in the months to come as the market fluctuates and our reputation suffers.
If the debt ceiling vote had taken place as in all previous years, we could have avoided this mess. Then the budget could have been taken up as a separate issue and nobody would have gotten the jitters. S&P would have seen that both parties were working together to create workable solutions to the debt problem and would not have dropped our rating.
When asked prior to the last election how they would cut the budget, the Tea Partiers could not tell you. They still cannot tell you, and their latest reckless behavior has shown that they could care less about our economy. They rode into power on angry rhetoric and money funded by the same Republican sources and people that fund the Republican Party. They are just the most extreme right of the extreme Republicans.
Geographically speaking, most come from the South. Some of them are waking up to the fact that their mantra of cutting everything means they would have to take cuts to their Social Security and Medicare and are not happy about that. Seeing this, some have abandoned the cause.
They have created a fissure in the Republican Party and the majority of Republicans do not know how to deal with them. They have openly threatened to launch primary challenges to those Republicans who are not fully on board with their radical agenda. It is a story of the tail wagging the dog in that party now. No doubt more to come is on the horizon.
©2011 Community News Group
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