Quote:
Originally Posted by Villages Kahuna
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Where I have been critical of the Tea Party is in how they have conducted themselves in trying to achieve those objectives, They were willing to sacrifice both the reputation of the U.S. as well as do irreparable damage to our economy in the interest of "making their point" in the recent debt ceiling negotiations. They negotiated for things that were never going to happen and they knew it. Some of their members actually said that they thought a default by the country would be a good thing in furthering their ideology. The leader of their caucus and a Presidential candidate voted against the deal that was finally agreed upon, apparently preferring default to anything less than the achievement of all their objectives.
I've said it before here, so maybe it bears repeating. While I agree with the principles of the Tea Party, I think they've done serious damage to the interests of fiscal conservatism by the way they conducted themselves in the last couple of months. .......Connecting the debt ceiling to the deficit reduction negotiations was the stated intent of the Tea Party alone. So what their conduct will cost the U.S. economy has only started with the credit downgrade.
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You can blame the Tea Party all you want, but the bottom line is the USA is not doing anything credible to ever repay its debt and THAT was a major factor in the S&P decision.
From the report:
"When comparing the U.S. to sovereigns with 'AAA' long-term ratings that we view as relevant peers--Canada, France, Germany, and the U.K.--we also observe, based on our base case scenarios for each, that
the trajectory of the U.S.'s net public debt is diverging from the others. Including the U.S., we estimate that these five sovereigns will have net general government debt to GDP ratios this year ranging from 34% (Canada) to 80% (the U.K.), with the U.S. debt burden at 74%. By 2015, we project that their net public debt to GDP ratios will range between 30% (lowest, Canada) and 83% (highest, France), with the U.S. debt burden at 79%.
However, in contrast with the U.S., we project that the net public debt burdens of these other sovereigns will begin to decline, either before or by 2015.
From "Full Report: United States of America Long-Term Rating Lowered To 'AA+' ......"
http://www.standardandpoors.com/home/en/us