U.S. downgraded from AAA to AA

[DeletedUser]

Some of you may be aware of the latest stock market crash, but might not be altogether clear why it happened. It happened because credit rating agencies downgraded the U.S. credit rating from AAA to AA+ (in particular, Standard & Poor's). If you want to understand how bad this is, the U.S. had been AAA since 1917.

And the reason it was downgraded? Because the credit agencies indicated they would do so if the House did not cut enough off the government's spending in their debt ceiling bill. In answer to this threat, the Republican representatives, led by John A. Boehner (R - OH), literally snubbed Standard & Poor's and other agencies, keeping tax cuts for the wealthy and making paltry cuts altogether, most of which would pose financial hardship for the U.S. in the long run due to insufficient cuts (particularly in the defense budget, where an ample stock of the budget is fluid).

So, the downgrade caused a panic, which resulted in an across-the-board plunge in ALL the markets (U.S., Asia, Europe, etc) over the last few days that took 9 months to attain. I can't say it's unprecedented, but it is damn significant.

 

[DeletedUser]

I think the panic selling was initially caused by European debt crisis not the US rating.About
the down grade well no one can say they didn't saw it coming.But we really shouldn't depend
on credit rating agencies so much.Remember how they gave good ratings to all the ludicrous
financial products before the recession?

About the stock market plunge I think it is an ominous sign.May be we are heading for another recession....

 

[DeletedUser]

Double dip is on the horizon by the sounds of it, a big problem is the stubborn EU with the single currency which is just not working - Ireland, Spain, Greece and Italy are going to be in big trouble soon - hard hats on!

 

[DeletedUser1121]

I do agree with Jesse James on the fact that credit rating agencies have to much power. What i find even more disturbing is the fact that they aren't controlled very well by any independent financial organisation.

And the stocks in Europe were going down, not only because of America, but the fear of Italy not being able to pay their debts anymore. And the weak speach Berlusconi gave when credit agencies doubted the financial options of Italy. The interest on Italian obligations got up to 6.2% (for reference, the percentage that Spain needs to pay is 6.3 and they have some big issues as well)

But I need to agree with HS on the fact that the whole situation in America is just ridiculous. They play with the entire world economy just for their own political agenda. The American politicians are really forgetting what politicians should do. And it is not only the Republicans. Obama himself made some huge mistakes in how he handled the credit ceiling issue. His hands of approach wasn't working for him when it came down on the health insurance debate, and it sure didn't work well in this issue.

 

[DeletedUser]

WHAT!!! I thought the Stimulus and raising the Debt ceiling was supposed to save America from this.

 

[DeletedUser]

Some of you may be aware of the latest stock market crash, but might not be altogether clear why it happened. It happened because credit rating agencies downgraded the U.S. credit rating from AAA to AA+ (in particular, Standard & Poor's). If you want to understand how bad this is, the U.S. had been AAA since 1917.

Hellstromm it was crashing before that. Why? Because the budget ceiling proposal was completely unsatisfactory to pretty much everyone. By the way most of the sources I've read say that AAA status has existed since 1941.

And the reason it was downgraded? Because the credit agencies indicated they would do so if the House did not cut enough off the government's spending in their debt ceiling bill. In answer to this threat, the Republican representatives, led by John A. Boehner (R - OH), literally snubbed Standard & Poor's and other agencies, keeping tax cuts for the wealthy and making paltry cuts altogether, most of which would pose financial hardship for the U.S. in the long run due to insufficient cuts (particularly in the defense budget, where an ample stock of the budget is fluid).

I love how you shoulder all the blame on the Republicans by reflex! It's so cute how much of a shill you can be. WHere to start? How about with accusing Republicans of inaction? You know those "idiots" that were overzealous in wanting to make cuts and were only stopped by "good" "levelheaded" Democrats who understood that spending must be preserved, if not increased. Ha, ha I think I even heard someone say we have to spend our way out of the recession. What a joke! S&P wanted the debt ceiling resolved and the debt under control. The Boehner plan answered one (to the disatisfaction of many Republicans, particularly the large number of Teapartiers, and barely controlled the other. As for snubbing S&P a certain Mr. Harry Reid shouldn't be forgotten for talking with Boehner for an extensive period. It was with both's idea of compromise that the plan was created with his name to attract Republican votes. the Democrats were already on board, except the ones that could not accept even the tiniest budget cut. Boehner just had to recruit Republicans to vote for what was really a Reid/Boehner plan so he did a lot of closed door negotiations over pizza on the eve of the so called coming default. Pizza and whatever special deals he offered and threats he made didn't lasso everyone, but enough to get the job done. Now the reason you have such a sad sap item is due not just to Boehner's stupidity, but also the only compromise that Harry Reid could endorse and expect his little troopers to obey orders and vote yes. It's both parties fault, and if there're heroes it's the Republicans who stayed with their principals and even the liberal Democrats if for no other reason than they said no.

So, the downgrade caused a panic, which resulted in an across-the-board plunge in ALL the markets (U.S., Asia, Europe, etc) over the last few days that took 9 months to attain. I can't say it's unprecedented, but it is damn significant.

Did you notice how nobody started to panic until the proposal started moving through congress? If you asked me if the budget ceiling had not been raised the US still could've paid off it's interest with taxes (all that's needed to keep creditors at bay) and no one would have become hysterical. Remember though, I thought you guys were rooting for a resolution to the debt ceiling you got it and now you're surprised how bitter it is?

WHAT!!! I thought the Stimulus and raising the Debt ceiling was supposed to save America from this.

HARDY HAR HAR! You have to stop listening to what El Presidente says will save America, he isn't always right.

 

[DeletedUser]

i think the reason the republicans are being blamed because the reasoning stated for the downgrade was there was nothing in the budget that included revenue increasing aka taxes being raised....and that is all on the republican party. they refused to accept any deal that included the raising of taxes...you cant just cut your way out of a recession.

I also read that we held our AAA rating since 1917....even through the GD....

 

[DeletedUser]

The debt ceiling and deficit reduction are two different issues. It's because the republicans coupled them together that this mess happened. Not raising the debt ceiling is like you buying a TV on credit and then deciding not to pay off the loan. Same thing with not spending your way out of a recession. You're just going to let the economy get destroyed? Really? And this somehow makes republicans heroes......wow..........

If you asked me if the budget ceiling had not been raised the US still could've paid off it's interest with taxes (all that's needed to keep creditors at bay)

You've just totally discredited yourself. We would've defaulted and not been able to pay off our interest. Plus, taxes were included in previous debt ceiling deals, but guess who shot them down......

 

[DeletedUser16628]

Common sense says when in a hole stop digging.I can't believe that these idiots just continue to dig.

================An "Entitlement???"
What the hell is wrong here?
Remember, not only did you contribute to Social Security but your employer did too. It totaled 15% of your income before taxes. If you averaged only 30K over your working life, that’s close to $220,500. If you calculate the future value of $4,500 per year (yours & your employer’s contribution) at a simple 5% (less than what the govt. pays on the money that it borrows), after 49 years of working (me) you'd have $892,919.98. If you took out only 3% per year, you receive $26,787.60 per year and it would last better than 30 years, and that’s with no interest paid on that final amount on deposit! If you bought an annuity and it paid 4% per year, you'd have a lifetime income of $2,976.40 per month. The folks in Washington have pulled off a bigger Ponzi scheme than Bernie Madoff ever had.


Entitlement my ass, I paid cash for my social security insurance!!!! Just because they borrowed the money, doesn't make my benefits some kind of charity or handout!! Congressional benefits, aka. free health care, outrageous retirement packages, 67 paid holidays, three weeks paid vacation, unlimited paid sick days, now that's welfare, and they have the nerve to call my retirement entitlements !!!!!!.....scroll down..............

Emergency Rooms for their general health care -At just one hospital the cost to tax payers totaled over 25 million a year!!!

Someone please tell me what the HELL's wrong with all the people that run this country!!!!!!

We're "broke" & can't help our own Seniors, Veterans, Orphans, Homeless etc.,???????????

In the last months we have provided aid to Haiti , Chile , and Turkey . And now Pakistan home of bin Laden. Literally, BILLIONS of DOLLARS!!!

Our retired seniors living on a 'fixed income' receive no aid nor do they get any breaks while our government and religious organizations pour Hundreds of Billions of $$$$$$'s and Tons of Food to Foreign Countries!

They call Social Security and Medicare an entitlement even though most of us have been paying for it all our working lives and now when its time for us to collect, the government is running out of money. Why did the government borrow from it in the first place?
We have hundreds of adoptable children who are shoved aside to make room for the adoption of foreign orphans.

AMERICA: a country where we have homeless without shelter, children going to bed hungry, elderly going without 'needed' meds, and mentally ill without treatment -etc,etc.

YET......................
They have a 'Benefit' for the people of Haiti on 12 TV stations, ships and planes lining up with food, water, tents clothes, bedding, doctors and medical supplies.

Imagine if the *GOVERNMENT* gave 'US' the same support they give to other countries.

SAD?
YEAH, OK, SO WHEN DO WE GET PISSED AND
DO SOMETHING ABOUT IT?????

Sorry a little off topic but really same church different pew.

 

[DeletedUser]

frankly, one could ask why the credit downgrade hasn't happened sooner. this is ridiculous.....

 

[DeletedUser]

Hellstromm it was crashing before that. Why? Because the budget ceiling proposal was completely unsatisfactory to pretty much everyone. By the way most of the sources I've read say that AAA status has existed since 1941.

Moody's posed a Aaa (essentially AAA) in 1917. This was followed shortly thereafter by Standard Statistics Bureau (part of the two predecessors, SSB & Poor Co., which merged in 1941 to create Standard & Poors) posing a similar rating structure. Fitch purchased rating agencies in 1997, and thus joined the party rather late.

And yes, of course it was in trouble before then, which is why S&P, Moody's and Fitch all posed warnings that this latest effort needed to be substantial and that party politics needed to take a back seat to economic viability. Unfortunately what they witnessed, in this latest fiasco, motivated S&P to downgrade the U.S.' credit rating. Moody's is holding back, but is likely to follow.

I love how you shoulder all the blame on the Republicans by reflex! It's so cute how much of a shill you can be. WHere to start? How about with accusing Republicans of inaction? You know those "idiots" that were overzealous in wanting to make cuts and were only stopped by "good" "levelheaded" Democrats who understood that spending must be preserved, if not increased.

The Republicans controlled the House, which was the Congressional department responsible for presenting the bill. It is quite apparent that John Boehner led the efforts to pose this particular bill, which was even unpopular within Republican circles and left Democrats split right down the middle, as demonstrated by the final vote. However, while the Republicans that didn't vote in favor indicated they were opposed to a rising of the debt ceiling, the Democrats indicated they were in opposition to the substandard cuts, the continuation of a tax break for the wealthy, and the compromise posed regarding Social Security and Medicare (an act that resulted in no cuts, but left the door open in the future for these non-entitlement, pay-in programs to be butchered). But, ultimately, a failure to pass anything would result in a lowering of the Nation's credit rating, which is the main reason many Democrats voted yes, despite their objections:

Yea
174 Republicans
95 Democrats

Nay
66 Republicans
95 Democrats

It needed 216 votes to pass.

You think I'm a shill, which is fine, think what you will. I think I amply demonstrated where the blame lays, particularly considering this entire issue wouldn't have existed if Bush Jr. and the Republican-led Congress hadn't put the U.S. from a stable status into this present financial hell. Granted, there were many Democrats in collusion, but leading dictates, not following, and the Republicans led the U.S. into economic collapse and now have led it into credit rating demotion.

S&P wanted the debt ceiling resolved and the debt under control.

No, the S&P made it amply clear it wasn't as much the debt ceiling issue, as it was the expenditures, the spending (of which the bulk of fluid spending is in the Defense budget, which the Republican leads were unwilling to touch) and in an increase in revenue (a significant chunk of which is lost due to the Republicans being unwilling to end the tax break on the wealthy).

The Boehner plan answered one (to the disatisfaction of many Republicans, particularly the large number of Teapartiers, and barely controlled the other.

Here's Boehner's plan: http://www.rules.house.gov/Media/file/PDF_112_1/legislativetext/S627 amnt.pdf

It's not well conceived, talking about reducing $1.8 trillion from the budget, but doesn't indicate how or where, leaving that for a newly created congressional committee. Still, you indicated the #1 issue here, the Republicans weren't on board with Boehner's bill (all 6o Representatives in the Tea Party caucus are Republicans, but it wasn't merely the Tea Party Republicans who were in opposition to Boehner's bill, it was almost all of them, and yet many of the Democrats were on board with it).


I'll respond to the rest of your diatribe at a later time, off to watch a movie.

 

[DeletedUser]

Okay, back to add to my previous post.

Regarding the original Boehner plan, the Tea Party caucus Republicans wanted a $4 trillion reduction, but their request was outrageous as they wanted it all to come from Medicare and Social Security, with not one penny out of Defense. The remaining 180+ Republicans thought a $1.8 trillion budget cut was too much. All of them were resolute about maintaining tax breaks for the wealthy.

On the Democratic angle, $1.8 trillion was well received, although the tier imposed for the debt ceiling was under contention and many Democrats still insisted that $1.8 trillion was insufficient in the long run, so an additional measure will need to be imposed at a later time. As well, there were issues about "what" was going to be cut that caused some Democrats to insist upon details. Almost all Democrats were not happy that the tax break for the wealthy was not addressed at all. A few scoffed at the inclusion of Pell Grants and student loans in Boehner's original bill, as it was completely unrelated to the issue at hand.

Btw, this isn't revisionist history. I was following the events as they transpired and all of this is reasonably documented in articles at the time the original bill was presented.

Harry Reid posed a bill that would result in a $2.2 trillion dollar cut <click here, here, and here>, which is substantially more than either of Boehner's bills (original and subsequent). But, instead of acting on this, Boehner demonstrated it was all about politics in his site and completely dismissed Reid's bill --> http://www.speaker.gov/blog/?postid=253982

Indeed, after further analysis, Boehner's original bill presented only $1.2 trillion in cuts, not $1.8 trillion. Interestingly, almost the same errors were made by Reid, who initially indicated his bill imposed $2.7 trillion in cuts, but it was later determined to be $2.2 trillion. Ultimately, however, Boehner posed a bill that was pathetic, at less than $900 billion in cuts, which was voted upon and approved by almost all the Republicans, sans the Tea Party caucus.

So then, we're at an impasse' in this discussion. You claim I'm a shill for the Democrats, I claim you're a hairy little monkey in tights. *smirk*

Seriously though, let's cut to the chase. If Bill Clinton's balanced budget plan had been maintained over the past 10+ years, the Federal Debt would have been cleared by now. Erradicated, paid off. Instead, Bush and the Republican-held Congress ran this nation into the ground, leaving people to search for "Hope" to pull us out of an economic collapse.

Revisionist history comes about when people try to give the impression this problem started at Obama's entry into office. Well, guess what:

History doesn't lie. This and many other cartoons drawn, and articles written, before 2009 amply demonstrate the problem existed before Obama took office. It was spiraling out of control, people were losing houses, the auto-industry was collapsing and banks were looking for charity bailouts from the government, which Bush Jr. provided.

It IS the Republicans that brought us here and it's been Obama's administration and the Democrats in Congress (not all, but many) who have been working an uphill battle to reverse the damage caused by an incredibly irresponsible administration, the Bush Jr. administration. It takes a dedicated process of whitewash revisionism to ignore the record number of filibusters, to dismiss history that is only a decade old.

 

[DeletedUser16628]

Debt downgrade hit pride more than markets

By now we all know that S&P has downgraded the US credit rating from AAA to AA+. That's a far cry from Greece's junk status and
still the second highest rating out there. The blow is more psychological than material. “What I think the S&P thing did
was to hit a nerve that there's something basically bad going on,and it's hit the self-esteem of the United States, the psyche,”
said the former chairman of the Federal Reserve, in an interview with NBC’s Meet the Press on Sunday. Having attacked S&P’s
“terrible judgment” in an exclusive interview with CNBC, US Treasury Secretary Tim Geithner said America is much stronger
than Washington itself and voiced his confidence in the “basic regenerative capacity of the American economy and the American
people.”

Others, like Bernd Weidensteiner, an economist at Commerce bank,agreed that equities could be in for a rough ride but said he
believes the effect on the Treasury market will be temporary.“Money market disruptions are not to be expected since money
market funds will not be affected by the rating action. They have only short-term Treasury paper in their portfolios, and the
short-term rating was not affected. Finally, haircuts in the repo market will certainly not rise massively,” said Weidensteiner.

Olick - rising foreclosures

"Just as we saw a double dip in home prices, we may be seeing another surge in foreclosures. And just as the home price
scenario was caused by artificial government stimulus, in the form of the home buyer tax credit juicing home sales only
briefly, the foreclosure scenario was caused by real negligence,in the form of the 'robo-signing' paperwork scandal. Banks and
servicers stopped foreclosures entirely for a time after the malpractice was discovered, and courts delayed the process,
picking through papers as foreclosures were resubmitted; that is now turning around. The system is ramping up again, and
foreclosure starts are up dramatically, more than 10% in June from the previous month, according to Lender Processing Services
(LPS). The good news of the past few months has been that while the end game is quickening, as stalled foreclosures are making
their way through the system at a faster pace, new delinquencies were decreasing, leading us all to believe that the crisis is
abating. Well think again.

New delinquencies rose 2.4% in June, which isn't a lot, but it is still the wrong direction. This as the pipeline is still so
clogged that foreclosure timelines continue to rise. The average loan in foreclosure in June was delinquent a record 587 days, and
more than 40% of 90+-day delinquencies have not made a payment in more than a year. For loans in foreclosure, 35% have been
delinquent for more than two years, according to LPS. [Friday's] surprisingly good jobs report for July did not do much to impress
economists, who cited still fewer people working in July than June and far fewer job creations on average in the past three
months than in three months before that. Bottom line, we need surging jobs to shore up consumer finances and consumer
confidence, both of which are vital to housing's recovery. Even as Fannie Mae reported a second quarter drop in mortgage
delinquencies in its portfolio, chief economist Doug Duncan had this to say about the future:

'Economic growth at the current pace is insufficient to spur sustained, robust job creation, which is required to boost
sentiment, spending and housing demand. Our July Fannie Mae National Housing Survey, to be released next Monday, continues to
indicate a high level of caution among consumers regarding additional financial commitments. In addition, 70% of Americans
believe that the economy is moving in the wrong direction,according to our quarterly survey that will be released. The
impact of recent financial market volatility on household wealth is an additional setback to confidence and the outlook for the
housing market.'

If the foreclosure numbers are not improving significantly, which the latest data would indicate, and the weak economy is in fact
getting weaker, the Obama administration will have to reverse its course of removing itself from housing and figure out new and
better ways to jump back in. I am constantly amazed, and have been for years, at how little the President speaks of our housing
disaster, especially of late. It's what got us into this mess in the first place, and without its strong recovery, the economy
cannot walk out of this recession on anything but a crippled foot."

Fed says it's business as usual

Federal Reserve officials publicly declared it was business as usual in the face of Standard and Poor’s downgrade of US
government debt, but privately they acknowledged these were uncharted waters. Within 90 minutes of S&P’s decision, a joint
release from US banking regulators declared that, despite the downgrade of US paper, there would be no change in the
risk-weighting of treasury bills, bonds and notes or any paper guaranteed by the US government. In other words, banks do not
have to post any additional capital against their Treasury positions. Regulators also announced that the treatment of US
treasuries at the Fed’s discount window would be unchanged.Typically, the riskier an asset, the more collateral banks have
to post to borrow from the Fed’s emergency lending facility.

Fed officials met in the past two days to consider the impact of a downgrade on markets. They concluded that, other than the
unknowable impact on sentiment, there would be little impact.They suggested that there was not much money that would have to
"mechanically" sell treasuries because of investment restrictions. So they didn’t expect much, if any, forced
selling. Even if there were, they concluded that interest rates were so low that any potential rise in rates would cause little
economic damage. They noted that treasury yields actually fell during the debt ceiling debate with its threat of default and
downgrade because the US is still considered a safe haven. In addition, they say that the S&P downgrade provides little new
information about the US debt situation that the markets didn’t have already. And markets have been on notice from S&P for
several weeks of a possible change. But Fed officials acknowledge they cannot quantify the potential psychological
impact on markets of the downgrade.My spelling and grammar are not perfect.Sorry.

 

[DeletedUser529]

The Entire system is basically BROKEN.

The U.S.A. has military operations in a total of 120+ countries. Participating in 2 major wars and got involved in Libya.

Everyone says dont touch my budget...especially the Military, why because it might compromise the security of the nation. How much moneys and lives have been wasted since 9-11, and how many more in the future.

I cant believe those idiots in Washington, argue over politics while the country burns through money like it is going out of style....

If the walmarts of the world did not exist and the hunger of people for CHEAP imports, America would still be a huge manufacturing country....

 

[DeletedUser]

The Republicans controlled the House, which was the Congressional department responsible for presenting the bill. It is quite apparent that John Boehner led the efforts to pose this particular bill, which was even unpopular within Republican circles and left Democrats split right down the middle, as demonstrated by the final vote. However, while the Republicans that didn't vote in favor indicated they were opposed to a rising of the debt ceiling, the Democrats indicated they were in opposition to the substandard cuts, the continuation of a tax break for the wealthy, and the compromise posed regarding Social Security and Medicare (an act that resulted in no cuts, but left the door open in the future for these non-entitlement, pay-in programs to be butchered). But, ultimately, a failure to pass anything would result in a lowering of the Nation's credit rating, which is the main reason many Democrats voted yes, despite their objections:

Here you are trying you best to depict the Democrats who opposed the bill as gallant heroes while discarding the Republicans who did the same as idiots. Your gallan heroes after all voted against the bill because of; sub-standard cuts (I have yet to hear a Democrat who gave that reason but many Republicans gave that as a primary reason why they were against the bill), the continuation of tax breaks for the rich (a real Democrat reason), and the compromise regarding social security and medicare (concerning medicare you do pay in but due to the longer lifespans people have medicare is often paying more for them than they paid in and regarding social security It does need some reforms). And then the threat that hitting the debt ceiling posed is what you said spurred Democrats to vote against their real preferences. What about Republicans, but wait you believe that they voted for the bill because they thought it was a great idea. Realize Hellstromm that Republican reasons for voting extend beyond "Duh, it was a great idea." or "No, cause we ain't raising the debt ceiling." they had as many if not more reasons to vote against it as the Democrats and those that voted in favor voted in favor because they believed they had to, just like your heroic Democrats.

You think I'm a shill, which is fine, think what you will. I think I amply demonstrated where the blame lays, particularly considering this entire issue wouldn't have existed if Bush Jr. and the Republican-led Congress hadn't put the U.S. from a stable status into this present financial hell. Granted, there were many Democrats in collusion, but leading dictates, not following, and the Republicans led the U.S. into economic collapse and now have led it into credit rating demotion.

Why is it only Bush Junior's fault? The problem was always waiting, the real estate bubble, the type of loans involved, were first widely promoted and adopted under the Clinton Admisistration. I find it hypocritical for either party to accuse the other of causing the economic meltdown, both comitted acts that contributed to it. I always take issue with you accusing Jr. not because I don't think he helped caused it but because you are being narrow-minded and failing to consider all the factors that made the recession as bad as it is. And look, you excuse the Democrats for being foolish as they were just following orders, meanwhile the Republicans are depicted by you as one and all a bunch of blundering buffoons who caused the entire mess. Watch it Hellstromm there's more than enough blame to go around.

No, the S&P made it amply clear it wasn't as much the debt ceiling issue, as it was the expenditures, the spending (of which the bulk of fluid spending is in the Defense budget, which the Republican leads were unwilling to touch) and in an increase in revenue (a significant chunk of which is lost due to the Republicans being unwilling to end the tax break on the wealthy).

Yes all the debt agencies are primarily concerned about deficits not debts (though debt should be a concern as the norm went from 19% of GDP under Clinton to 20% under Bush to 25% under Obama). Yes a great deal of excess exists in the military budget I understand that there are many Republicans who are unwilling to touch it. I however blanch at your precious Democrats who scream all or nothing and would leave our military in the state it was on the eve of the Korean war, underfunded and weak. And why must there always be revenue increases? Isn't this like putting someone on a diet and then stuffing more food in the fridge? Why must there always be tax increases, can't things get along without them?

Okay, back to add to my previous post.

Regarding the original Boehner plan, the Tea Party caucus Republicans wanted a $4 trillion reduction, but their request was outrageous as they wanted it all to come from Medicare and Social Security, with not one penny out of Defense. The remaining 180+ Republicans thought a $1.8 trillion budget cut was too much. All of them were resolute about maintaining tax breaks for the wealthy.

Show me on that Tea Party plan, I wish to see their idea. And where was it stated that the rest of the Republincans thought that 1.8 trillion was too great a cut? You're going to have to show me because that sounds like a statement that would be made by a Democrat that the cuts are too severe.

On the Democratic angle, $1.8 trillion was well received, although the tier imposed for the debt ceiling was under contention and many Democrats still insisted that $1.8 trillion was insufficient in the long run, so an additional measure will need to be imposed at a later time. As well, there were issues about "what" was going to be cut that caused some Democrats to insist upon details. Almost all Democrats were not happy that the tax break for the wealthy was not addressed at all. A few scoffed at the inclusion of Pell Grants and student loans in Boehner's original bill, as it was completely unrelated to the issue at hand.

Characterizing your Democrat heroes once again they thought that 1.8 trillion was a good start to greater things. C'mon! Really, I'm starting to get sick of you depicting Democrats in positions that I've only ever hear Republicans taking? I don't believe for a minute they were so heroic as you think they were.

Btw, this isn't revisionist history. I was following the events as they transpired and all of this is reasonably documented in articles at the time the original bill was presented.

Show me the articles cause this sounds like a heavy dose of revisionism.

Harry Reid posed a bill that would result in a $2.2 trillion dollar cut <click here, here, and here>, which is substantially more than either of Boehner's bills (original and subsequent). But, instead of acting on this, Boehner demonstrated it was all about politics in his site and completely dismissed Reid's bill --> http://www.speaker.gov/blog/?postid=253982

Indeed, after further analysis, Boehner's original bill presented only $1.2 trillion in cuts, not $1.8 trillion. Interestingly, almost the same errors were made by Reid, who initially indicated his bill imposed $2.7 trillion in cuts, but it was later determined to be $2.2 trillion.

Why do you think Boehner dismissed Reid's bill? Number one the ceiling is raised more than was cut which would open the future to increased spending. Second Reid's bill includes a trillion dollars in money that was already not going to be spent in Iraq and Afghanistan. So Boehner's plan would actually cut an additional trillion if we follow Harry Reid's math, or we subtract the trillion and we have 1.2 trillion dollars on par with Boehner's plan. The rest of Reid's plan consisted almost entirely of slashing at the defense budget which is just as ridiculous as only looking at cuts to Medicare and Social Security. There you go two equal plans illustrating two sides, the difference is the Democrats make room for future spending increases.

Ultimately, however, Boehner posed a bill that was pathetic, at less than $900 billion in cuts, which was voted upon and approved by almost all the Republicans, sans the Tea Party caucus.

Note how when you discuss Republicans it's without caveats you apply to Democrats.

Seriously though, let's cut to the chase. If Bill Clinton's balanced budget plan had been maintained over the past 10+ years, the Federal Debt would have been cleared by now. Erradicated, paid off. Instead, Bush and the Republican-held Congress ran this nation into the ground, leaving people to search for "Hope" to pull us out of an economic collapse.

The rotteness that led to the collapse was already there, and how would you have responded to 9/11, left them alone?

Revisionist history comes about when people try to give the impression this problem started at Obama's entry into office. Well, guess what:

History doesn't lie. This and many other cartoons drawn, and articles written, before 2009 amply demonstrate the problem existed before Obama took office. It was spiraling out of control, people were losing houses, the auto-industry was collapsing and banks were looking for charity bailouts from the government, which Bush Jr. provided.

It IS the Republicans that brought us here and it's been Obama's administration and the Democrats in Congress (not all, but many) who have been working an uphill battle to reverse the damage caused by an incredibly irresponsible administration, the Bush Jr. administration. It takes a dedicated process of whitewash revisionism to ignore the record number of filibusters, to dismiss history that is only a decade old.

No history is being dismissed by me. I accept the wastes and mistakes of the Bush Jr. Administration. I wish you would acknowledge the mistakes of administrations besides that one. As for Obama, I'm not saying he started the problem, but he's contributing to it.

 

[DeletedUser]

Well there always be trolls who get rich out of this. Wonder where all these lost money go. they don't disappear. So wtf is happening? There would be much nicer life without money, just can't believe what people can do to each other, just to get some cash. Ordinary folks never get to know the truth anyway. Its so upsetting. You can save whole your life and then you scr*wed because of some stupids who play with the economy.

 

[DeletedUser]

Well there always be trolls who get rich out of this. Wonder where all these lost money go. they don't disappear. So wtf is happening? There would be much nicer life without money, just can't believe what people can do to each other, just to get some cash. Ordinary folks never get to know the truth anyway. Its so upsetting. You can save whole your life and then you scr*wed because of some stupids who play with the economy.

I say we go back to the gold standard and Bartering.

 

[DeletedUser]

The two don't go together Gizmo. Gold standard refers to currency, you should say gold standard or bartering. Though I have to admit my family does a lot of bartering with the products it sells already, though people who don't produce goods or provide notable services are at a disadvantage.

 

[DeletedUser]

LOL - you guys know that US treasuries have actually gone up since the downgrade (i.e. yield is lower) - that is all u need to know about S&P's hubris. it is a shame they spooked the markets, though.

 

[DeletedUser]

the downgrade was more psychological than economic, cookesj. the US is still the safest place to put your money.

Realize Hellstromm that Republican reasons for voting extend beyond "Duh, it was a great idea." or "No, cause we ain't raising the debt ceiling." they had as many if not more reasons to vote against it as the Democrats and those that voted in favor voted in favor because they believed they had to, just like your heroic Democrats.

You're assuming,wrongly, that the republicans have intelligence.

Why is it only Bush Junior's fault? The problem was always waiting, the real estate bubble, the type of loans involved, were first widely promoted and adopted under the Clinton Admisistration.

It's called human nature, and the economic cycle, that created that problem that was always waiting. It's bush's fault because he made it much, much worse.

I however blanch at your precious Democrats who scream all or nothing and would leave our military in the state it was on the eve of the Korean war, underfunded and weak. And why must there always be revenue increases? Isn't this like putting someone on a diet and then stuffing more food in the fridge? Why must there always be tax increases, can't things get along without them?

Actually, they're screaming most or nothing, or at least I am, if you paid attention. Show me how our military was weak prior to the korean war, it seems more like the US didn't view n. korea as a big enough threat to garner a large troop deployment.
and as i've said before, the debt ceiling and deficit reduction are two different issues. it's the republicans' forcing them together and fallout from that which is causing havoc in the economy right now. and the revenue increases are so we can reduce the deficit, if you actually paid attention.

The rest of Reid's plan consisted almost entirely of slashing at the defense budget which is just as ridiculous as only looking at cuts to Medicare and Social Security.

while there are deficiencies in medicare and social security, the money in those programs come from workers, it's their money, not something that the gov't can just cut. defense, on the other hand, is mostly frivolous...'yea, before, it took us ten seconds to take care of 'em, but now, we can totally vaporize them in three seconds, dude'......

The rotteness that led to the collapse was already there, and how would you have responded to 9/11, left them alone?

really, the rottenness was already there? clinton already had a plan to balance the budget. had it been implemented, we'd be fine. but bush chose to go in the opposite direction. as for 9/11, we could've just defended ourselves better and we really didn't need to involve ourselves with the middle east to the degree that we did. bad things happen and there will always be bad guys. it's futile to try and wipe out all the bad guys.

No history is being dismissed by me. I accept the wastes and mistakes of the Bush Jr. Administration. I wish you would acknowledge the mistakes of administrations besides that one. As for Obama, I'm not saying he started the problem, but he's contributing to it.

by saying you accept the wastes and mistakes of the bush administration, you have contradicted yourself. and remember my sinking ship analogy? that's why this credit downgrade happened.