The head of S&P explains their decision VIDEO

[Greenbeard]

Did you not watch the video in the OP.

Given that the first quote is from that video ("The political settings we don't think are as strong as some of the strongest sovereigns that we rate. The most recent evidence for that is the debate we had over raising the debt ceiling and the U.S. government coming within a day of having cash management problems."), what do you think?

The problem is not that a large enough deficit reduction package hasn't been passed. It's that our political circumstance (namely, the intransigence of a certain faction of political actors that now dictates the actions of an entire political party) makes it impossible to pass a larger package. And that's primarily because one side of the negotiation will not grant any concessions to the other, making compromise impossible. The numbers are significant only insofar as they reveal something about our political system's woes (i.e. the "grand bargain" that was on the table had to be scrapped because more deficit reduction became unpalatable to a certain group once the package included concessions to Democrats).

 

[Avorysuds]

Did you not watch the video in the OP.

Given that the first quote is from that video ("The political settings we don't think are as strong as some of the strongest sovereigns that we rate. The most recent evidence for that is the debate we had over raising the debt ceiling and the U.S. government coming within a day of having cash management problems."), what do you think?

The problem is not that a large enough deficit reduction package hasn't been passed. It's that our political circumstance (namely, the intransigence of a certain faction of political actors that now dictates the actions of an entire political party) makes it impossible to pass a larger package. And that's primarily because one side of the negotiation will not grant any concessions to the other, making compromise impossible. The numbers are significant only insofar as they reveal something about our political system's woes (i.e. the "grand bargain" that was on the table had to be scrapped because more deficit reduction became unpalatable to a certain group once the package included concessions to Democrats).

Or they are saying what they said... That our politics is screwed up and there are not enough people that care about passing a budget that matters. Meaning, Dems didn't want to pass enough cuts and Reps didn't want to pass enough cuts and Obama didn't want any cuts because none of them want to be known as the party that cut for 2012... Oh, well the Tea Party was ok with it but dumbshits like you pretend they wanted default when it was the Reps/Dems and Obama that destroyed our credit rating, not the TP being the TP offered a balanced budget and the Dems/Reps didn't.

We ended up with a mix between the Dem budget and the Rep budget (Dem budget didn't have any new taxes lol) and that's why we were downgraded.

 

[Si modo]

You can say that, but the S&P clearly said what they mean.

Indeed, they've repeatedly cited the dysfunctionality of our political process, now that the "No Compromise!" Brigade has come to town:

The political settings we don't think are as strong as some of the strongest sovereigns that we rate. The most recent evidence for that is the debate we had over raising the debt ceiling and the U.S. government coming within a day of having cash management problems.

Or:

We lowered our long-term rating on the U.S. because we believe that the prolonged controversy over raising the statutory debt ceiling and the related fiscal policy debate indicate that further near-term progress containing the growth in public spending, especially on entitlements, or on reaching an agreement on raising revenues is less likely than we previously assumed and will remain a contentious and fitful process.

We have real problems, no one denies that. The reason we're in this particular situation now, however, is that the political process has been intentionally paralyzed by some of its more zealous participants and S&P no longer believes our political system is capable of working. It's a sobering assessment but its implications seem to have been lost on some.

Actually, the S&P said the Ryan budget would have averted this ratings drop.

Reality.

 

[Greenbeard]

Actually, the S&P said the Ryan budget would have averted this ratings drop.

Reality.

Since this territory has already been covered, I was going to point you to the relevant thread but then I realized that was this thread. So I'll repeat:

Ryan's budget was not a serious proposal, it was red meat for the rightwing base. That's obvious enough from it contents, but Dave Camp admitted as much when he explained why Ways and Means wouldn't even bother to mark it up: “I’m not really interested in just laying down more markers. I’d rather have the committee working with the president and with the Senate, focused on savings and reforms that can be signed into law,” the Michigan Republican said.

That process Camp is talking about--coming up with workable compromises in the give-and-take of the democratic process--is what S&P decided we're unable to do. And the reason for that is the Ryans of the world, more interested in laying down markers and political grandstanding than offering workable proposals. When the chairman of the Budget Committee's best offer is a proposal that's abhorrent to Democrats, who still happen to control the Presidency and the Senate--a proposal that ends Medicare, shifts Medicaid costs onto states, municipalities and safety net providers, and slashes tax rates for the wealthiest Americans, all in exchange for 30 more years of deficit spending--then we have a serious political problem.

Democrats are willing to accept spending cuts as part of a broad deficit-reduction approach that includes raising revenues. They control the Senate and Presidency, which means they get a say--something the hardliner nutjobs in the House don't seem to have grasped yet. Correction: they've realized that the normal contours of the political system don't allow 240 House Republicans to completely dictate fiscal policy for the United States. That's why they've gotten creative by attempting to hold the nation's economy hostage by refusing to allow the executive branch to write the checks for the spending they authorized in April; they realized that the alternative is to compromise to make progress, and we know that's a dirty word for them.

Unfortunately, that preference for brinkmanship over statesmanship is why S&P doesn't think mature policymaking can happen in the current government and why they downgraded us:

In an unusual Saturday conference call with reporters, senior S.& P. officials insisted the ratings firm hadn’t overstepped its bounds by focusing on the political paralysis in Washington as much as fiscal policy in determining the new rating. “The debacle over the debt ceiling continued until almost the midnight hour,” said John B. Chambers, chairman of S.& P.’s sovereign ratings committee.

Reality.

 

[Si modo]

Actually, the S&P said the Ryan budget would have averted this ratings drop.

Reality.

Since this territory has already been covered, I was going to point you to the relevant thread but then I realized that was this thread. So I'll repeat:

Ryan's budget was not a serious proposal, it was red meat for the rightwing base. That's obvious enough from it contents, but Dave Camp admitted as much when he explained why Ways and Means wouldn't even bother to mark it up: “I’m not really interested in just laying down more markers. I’d rather have the committee working with the president and with the Senate, focused on savings and reforms that can be signed into law,” the Michigan Republican said.

That process Camp is talking about--coming up with workable compromises in the give-and-take of the democratic process--is what S&P decided we're unable to do. And the reason for that is the Ryans of the world, more interested in laying down markers and political grandstanding than offering workable proposals. When the chairman of the Budget Committee's best offer is a proposal that's abhorrent to Democrats, who still happen to control the Presidency and the Senate--a proposal that ends Medicare, shifts Medicaid costs onto states, municipalities and safety net providers, and slashes tax rates for the wealthiest Americans, all in exchange for 30 more years of deficit spending--then we have a serious political problem.

Democrats are willing to accept spending cuts as part of a broad deficit-reduction approach that includes raising revenues. They control the Senate and Presidency, which means they get a say--something the hardliner nutjobs in the House don't seem to have grasped yet. Correction: they've realized that the normal contours of the political system don't allow 240 House Republicans to completely dictate fiscal policy for the United States. That's why they've gotten creative by attempting to hold the nation's economy hostage by refusing to allow the executive branch to write the checks for the spending they authorized in April; they realized that the alternative is to compromise to make progress, and we know that's a dirty word for them.

Unfortunately, that preference for brinkmanship over statesmanship is why S&P doesn't think mature policymaking can happen in the current government and why they downgraded us:

In an unusual Saturday conference call with reporters, senior S.& P. officials insisted the ratings firm hadn’t overstepped its bounds by focusing on the political paralysis in Washington as much as fiscal policy in determining the new rating. “The debacle over the debt ceiling continued until almost the midnight hour,” said John B. Chambers, chairman of S.& P.’s sovereign ratings committee.

Reality.

Still, what you say are the reasons are irrelevant to the ACTUAL reasons the rating was dropped. If the Ryan budget had been accepted, the rating drop would have been averted - from the horse's mouth.

Your mouth doesn't count.

No offense.

 

[Greenbeard]

Still, what you say are the reasons are irrelevant to the ACTUAL reasons the rating was dropped.

What I say are the reasons are exactly what they've said. The fact that S&P is wary of our dysfunctional political system is the reason they downgraded us; the other rating agencies are less concerned about that and thus they didn't downgrade us. The insane political decision to throw into question whether or not the U.S. would bother to pay for its obligations was the catalyst and we know whose moronic idea that was.

In an unusual Saturday conference call with reporters, senior S.& P. officials insisted the ratings firm hadn’t overstepped its bounds by focusing on the political paralysis in Washington as much as fiscal policy in determining the new rating. “The debacle over the debt ceiling continued until almost the midnight hour,” said John B. Chambers, chairman of S.& P.’s sovereign ratings committee.

And yes, St. Ryan is a big part of that dysfunction.

 

[Si modo]

A pleasant brunch would've averted this rating drop.

S&P doesn't believe the House is capable of working with the President to address the nation's problems. That level of dysfunction is dangerous in ordinary times and doubly so in the present circumstances. The "No Compromise!" Brigade has openly sought political dysfunction and gridlock in a self-destructive bid to make Obama a one-termer.

Any signs on their part of willingness to engage in the give-and-take that characterizes democratic politics would've been more than enough.

You can say that, but the S&P clearly said what they mean.

You don't matter. They do. Their words matter, yours are just wishful thinking.

No offense.

yes words mean things, but the problem is i dont think you understand them:

We lowered our long-term rating on the U.S. because we believe that the prolonged controversy over raising the statutory debt ceiling and the related
fiscal policy debate indicate that further near-term progress containing the
growth in public spending, especially on entitlements, or on reaching an
agreement on raising revenues is less likely than we previously assumed and
will remain a contentious and fitful process.

They are saying to shut the fuck up and stop bickering like children. That we needed to raise the ceiling, contain the spending after we raised it, Raise taxes to pay for the debt we already owe and balance the budget.

But yes you keep on cherry picking what was said.

Well, Obama had a hell of a lot to do with that, as well.


Look, Obama wanted this, and he got it. It's bad. Suck it up and take the criticism. You earned it.

But, look on the bright side - it does help with deflating that American exceptionalism that the left hates so much, so, that's a plus for your side.