Standard and Poor’s has removed the AAA credit rating from the United States and, coupled with similar turmoil, in Europe, global stock markets lost another $2.5 trillion last week. That’s about $17 trillion since President Obama took office.
China, which holds an alarming amount of U.S. debt, is not amused and took the Obama administration to task for the weakness, and called again for a new currency to replace the dollar.
The Obama administration, forgetting it is no longer 2008 2009 2010, had talking head David Axelrod float blaming the problem on the Tea Party and generally, Republicans of all kinds. Luckily, no one under the age of 90 watches “Meet The Press”.
Really, George W. Bush did a lot wrong but what did he ever blame on the progressive version of the Tea Party, MoveOn.org? These people have no real power or authority, it is just Republicans unhappy about being jammed up for four years and sensing weakness because Pres. Obama had House Majority Leader Nancy Pelosi making him look bad from the moment of his Nobel Peace prize nomination inauguration speech. That is why she is now House Minority Leader. What she should be is unemployed but she represents San Francisco so her entire campaign consists of contending if she is not re-elected Republicans will be able to ban abortion, and that seems to work.
I like Pres. Obama. I think, like Reagan in 1984, he had a hard first two years with an economy not of his doing and he also had a hostile Congress out to screw him. Reagan had a Congress determined to never curb spending even as he wanted tax cuts – Obama is stuck with a Congress determined to cut spending regardless of benefit.
The key difference today is a foreign power did not have a crazy amount of debt then. Playing the blame game while the dollar gets replaced and America turns into Bulgaria is a Pyrrhic victory. It is better strategy to show Treasury Secretary Timothy Geithner the door and get someone in there who knows what they are doing. Then remind the world economies that the fundamentals of the US haven’t changed and offer up a sacrificial policy or two to Republicans and get on with increasing revenue, not demanding more spending. The base is not strong enough to win re-election if the disgruntled middle Americans who wanted change stay home in 2012.
S. & P.’s ratings are actually pretty terrible. In 2006, Ireland had a AAA rating yet it actually has a 40% chance of defaulting but Standard & Poors didn’t notice until 2009.
Somehow Spain has a better rating than Japan, despite a nearly 30% chance of being underwater soon.