The unprecedented downgrading of the nation’s AAA credit rating by Standard & Poor’s on Friday was hardly a surprise to anyone paying attention. The handwriting was on the wall as early as July 29, on which date this columnist wrote:
Even if a deal is reached at this point, the cuts to the deficit will likely be too small to prevent the U.S. debt from being downgraded for the first time in history from its AAA status.
The White House is attempting to deflect criticism this morning by claiming that S&P committed a math error in its debt/GDP computation, which precipitated the downgrade, but Treasury Secretary Timothy Geithner has been surprisingly quiet so far.
He was considerably more vocal in April, as captured in the accompanying video, when he said, not once but twice, that there “is no risk” of the United States losing its AAA credit rating and affirming that Standard & Poor’s was wrong in its warnings that a downgrade was imminent.
With the threat of another downgrade looming in the next 12 to 18 months, the nation’s leaders need to get serious about slashing our runaway deficit and eliminate future deficit spending. As it is, the downgrade in credit status will increase the interest rates on our loans, making it that much more difficult to accomplish that goal.
While those on the left will almost certainly now loudly reprise their argument that the current financial bind the nation finds itself in is a direct result of the Tea Party’s intransigence, bear in mind that as recently as April the president was calling for a clean debt limit increase. His awareness of the compelling need to reign in spending and pay down the debt, if it existed, was a well-guarded secret.
Let’s hope that his newfound resolve to cut the deficit is not just another political expedient.
P.S. It is worth noting that Treasury Secretary Geithner, who had previously announced that he would leaving his cabinet post, gave word several days ago that he will be staying on after all. Lucky, no?
- John Kerry: Media should not give equal time to Tea Party
- Tea Party terrorists and the left’s civility pledge
- If the Boehner plan fails, what then?
The Sore Loser Party threatens to hold its breath (Video)
Click Subscribe at the top of the page to have my articles sent directly to your e-mail inbox. Follow me on Twitter or join me at Facebook. You can reach me at [email protected] or by posting a comment below.