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The Spectacle Blog

Further Downgrades Don't fit the Narrative

By Robert P. Kirchhoefer on 8.8.11 @ 12:24PM

Standard & Poors downgraded the United States' credit rating and the left claims it's because of the Tea Party and its alleged intransigence after focusing on one aspect of Standard & Poor's explanation. But how do you blame the Tea Party for downgrades in further institutions not having anything to do with alleged Tea-Party-partisanship? The story (here):

Meanwhile, S&P downgraded government-sponsored enterprises Fannie Mae and Freddie Mac to AA+ from triple-A, with S&P citing their reliance on U.S. government.

Ten of the country's 12 Federal Home Loan Banks were also cut to AA-plus. The banks of Chicago and Seattle had already been downgraded earlier to AA+.

Fannie and Freddie own or guarantee about half of all U.S. mortgages, or nearly 31 million home loans worth more than $5 trillion. As part of a nationalized system, they account for nearly all new mortgage loans. Their downgrade might force anyone looking to buy a home to pay higher mortgage rates.

S&P also cut ratings for several of the main arteries of the US financial system -- the Depository Trust Co., National Securities Clearing Corp., Fixed Income Clearing Corp. and the Options Clearing Corp. -- were cut one notch to AA-plus.

Clearly the left needs to update the tired narrative before its Credibility Rating plummets to outright calumny.

View all comments (23) | Leave a comment

Lentenlands| 8.8.11 @ 12:34PM

It really should be called the S&P's Marxist-Progressive-Leftist-Liberal-Democrat-Obama Downgrade Of America.

Collapsing the economy, creating anarchy and starting a civil war has always been the goal of the marxists plotting to destroy the American Dream and marxist Barry Obama is no exception. Obama’s marxist college professors, Cloward and Piven, were quite forthright in their efforts to formulate a method to collapse the economy to destroy America and usher in a marxist tyranny of slavery and death.

"The strategy of forcing political change through orchestrated crisis, the "Cloward-Piven Strategy" seeks to hasten the fall of capitalism by overloading the government bureaucracy with a flood of impossible demands, thus pushing society into crisis and economic collapse."

Our Manchurian President is simply a treasonous usurper partying, vacationing and golfing as his marxist plan of destruction unfolds. Obama and his pals are TERRORISTS destroying YOUR Nation and future.

It’s time to wake up America and do something about it!

http://smashabanana.blogspot.com

simon templar| 8.8.11 @ 12:35PM

This guy notices! Keep pointing out their narratives, lies, and contradictions.

TheRightIsAnythingBut| 8.8.11 @ 12:39PM

Awe-inspiring and not in a good way: Tea Partiers Cheer the Downgrade of America's Credit Rating:

http://motherjones.com/mojo/2011/08/video-tea-partiers-cheer-downgrade-americas-credit-rating

axbucxdu| 8.8.11 @ 12:54PM

I suppose they are cheering because Mr. Market has begun to intervene when the pols abdicated their fiscal responsibilities once more. The TP'ers are simply saying "we told you so". Money doesn't grow on trees. Learn to live with the economic fallout from progressives trying to have it otherwise.

JimBob7| 8.8.11 @ 1:13PM

Hey lefty, Maybe they are cheering because finally the Obama enablers are waking up to reality? By the way, Mother Jones is just as useful a tool as the New York Times, if you need to put down paper on the floor to potty train a puppy.

Occam's Tool| 8.8.11 @ 4:32PM

I'm cheering that someone is noticing in time to prevent us from going off the cliff due to the policies of The Invisible College Transcript.

Margie| 8.8.11 @ 10:47PM

Obama~ The Invisible Man.

Conservative Bob| 8.8.11 @ 12:54PM

I love the narrative of the left.. the downgrade was caused by the only group i the country that consistantly wants to cut spending.

Not by the presedent and his pasrty who had super majorities in both houses until Nov 2012 and spent more money in that time than all of the other presidents combined...

Yea it was the TEA party all right... beyond laughable.

George S| 8.8.11 @ 1:13PM

I blame my boss for my low credit rating. I can't get a mortgage or a car loan and my credit card applications are returned with "...we're sorry". All because in the past I charged up tons of money and made late payments, defaulted on some and basically ignored others. Hey, I can't enjoy weekends in the Bahamas if I have to divert some cash to the credit card companies, ya know bro? Yup, it's all my bosses fault... if only he was fiscally responsible and shared up some sacrifice, I wouldn't be in this mess. All he had to do was pay me more to cover my debts. But no, he's got his corporate jets to pay for. Ingrate.

Trinacria| 8.8.11 @ 1:50PM

"Clearly the left needs to update the tired narrative before its Credibility Rating plummets to outright calumny. "

Hate to be the perputual pessimist, but it should not be forgotten that the left relies on this irrational vacuous narrative for one simple reason: it works! For all their shortcomings (and, to be sure, there are many), the left has figured out the one indisputable mathmatical fact that can be used to their strategic advantage: By definition, 50% of Americans have an IQ below the median. This, coupled with the natural human tendency to envy, has been exploited by liberals who have developed a time tested "rage over reason" strategy that employs the classic battlefield tactics of class warfare. While I'd be delighted to be wrong, I fear there's little reason to believe that even the catastrophic failures of the present administration will be enough to bring wisdom to those who, lest we forget, were so intellectually bereft that they chose to blindly endorse for the position of "Leader of the Free World" a hack community organizer with NO executive experience and NO strategic plan beyond the utterly meaningless rhetoric of "hope and change".

Butch| 8.8.11 @ 3:54PM

You have just put your finger smack on the root problem, Trinacria. IQ is a bell curve, half the American population has below-average intelligence, and about a third are downright dull. But they vote, or they are eligible to.

The framers sensed this, and they severely restricted the right to vote to people with characteristics associated with intelligence and knowledge. Over time, the government eliminated all restrictions, and the result is an electorate heavily loaded with dull, ignorant voters. They are easily deceived.

Grzmlyk| 8.8.11 @ 2:30PM

You know who's fault this is, don't you?

None other than George Bush.

I suppose he shares blame with Darth Cheney and his Halliburton Death Star.

But let's look at this like good liberals, shall we? If Obama hadn't become president, think how much worse off we'd be now. Think what would have happened if the Titanic hadn't hit that iceberg; why, all 2,228 souls on board would have died (of something) instead of just 1,517.

Or if Charles Manson hadn't sent his minions out to kill 5 people at Sharon Tate's house in 1969; think how many MORE people would have been killed that night.

Obama is the hero of this economy the same way the iceberg is the hero of the Titanic sinking or Charlie Manson is the hero of the Tate murders.

And if you say otherwise, you're a racist.

Long Love Obama!

Trinacria| 8.8.11 @ 4:25PM

You're absolutely right, G; Bush is to blame for this and all manner of other ills that have plagued our once-great nation. As a matter of fact, I'm reliably informed that the oppressive heat wave currently plaguing the eastern two-thirds of the US can be directly traced to George Bush and his fat cat buddies in Big Ice. And just this spring, those of us who live in California were treated to the wettest spring on record, with alost daily rainfall for weeks on end - can there be any reasonable doubt that the culprit is GWB and his nefarious connections with Big Umbrella? I think the evidence speaks for itself.

Trinacria| 8.8.11 @ 4:29PM

"almost"...

Pete| 8.8.11 @ 3:22PM

The S&P should just take its lead from dumbO and Biden. They "saved or created" several ratings levels...and...it could have been so much worse.

martin j smith| 8.8.11 @ 3:32PM

Question: Does Obama actually wish our down grade while at the same time blame others for it ?

Margie| 8.8.11 @ 3:35PM

Dear Martin,

Do you really have to ask that question?

Occam's Tool| 8.8.11 @ 4:36PM

Margie,

it's a fun question to ask, because the answer is energizing---kind of like the following:

"Persian messenger: Listen carefully, Leonidas. Xerxes conquers and controls everything he rests his eyes upon. He leads an army so massive it shakes the ground with its march, so vast it drinks the rivers dry. All the God-King Xerxes requires is this: a simple offering of earth and water. A token of Sparta's submission to the will of Xerxes.
Leonidas: Submission. Well, that's a bit of a problem. See, rumor has it that the Athenians have already turned you down. And if those philosophers and... boy-lovers have found that kind of nerve—
Theron: We must be diplomatic -.
Leonidas: (cutting him off) And of course Spartans... have their reputation to consider.
Persian messenger: Choose your next words carefully, Leonidas. They may be your last as king.
[Leonidas turns and ponders the offer. He looks at various people standing around, watching him nervously, the last of whom is Gorgo.]
Leonidas: [in his head] Earth and water... [having made up his mind, he draws his sword on the Persian messenger, whose back is to a large well. The Spartan guards follow suit and draw their swords on the other messengers.]
Persian messenger: Madman... You're a madman!
Leonidas: Earth and water... You'll find plenty of both down there. [indicates the well with his sword]
Persian messenger: [nervous] No man, Persian or Greek, no man threatens a messenger!
Leonidas: You bring the crowns and heads of conquered kings to my city's steps! You insult my queen. You threaten my people with slavery and death! Oh, I've chosen my words carefully, Persian. Perhaps you should have done the same.
Persian messenger: This is blasphemy! This is madness! [Leonidas lowers his sword and looks toward Gorgo, who nods]
Leonidas: [facing the Persian messenger] Madness? This is Sparta!! [kicks the Persian messenger into the deep well.]"

TruthSpeaker| 8.8.11 @ 5:51PM

Absolutely he does. Why do you think he was elected? Surely not to do anything positive for American or her peoples. He is Soros' pawn. Please note that soros made a killing last week due to our downgrade. The man is evil. so is obama

jrs| 8.8.11 @ 9:29PM

Robert,
This is about one of the worst arguments I've ever read. Let's ignore for a second whose to blame. Your argument is that the fact that these subsequent downgrades are proof that it wasn't related to the tea party. This doesn't prove anything. Rating agencies apply the weakest link methodology to ratings. To the extent that a rating is higher than it would be on it's own (due to balance sheet, structure, etc....) due to support, the benefit of the support cannot exceed the rating of the support provider. Since all these other bonds relied on implicit (at least initially) or explicit support to achieve their AAA, since the support provider is no longer AAA, they lose their rating. Therefore, these subsequent ratings actions, in of themselves, don't prove or disprove the tea party as at least partially to blame.

jrs| 8.8.11 @ 9:47PM

The downgrade reflects 2 parts. The first, and real concern is how we've been managing this economy for years, hole heartedly buying into the laffer curve (i.e. I can cut taxes w/out cutting any spending), running an excessively large but still overextended military and sending into missions that we don't need, failure to adjust entitlements while adding new ones (medicare part D and of course Obamacare), a relatively useless stimulus (we could go on and on). Fixing this will be hard work, and I do applaud the Tea Party for finally highlighting this. HOWEVER, the downgrade reflects a second part. They are concerned where political discourse has gone in this country and the possible implications. This will also be tough, but the fact that we've let things get this bad is pathetic, and is completely avoidable. The fact that we had people say that they're against any raise in debt ceiling under any circumstances is ridiculous. Hey, I want cuts too, but the mathematical reality is that the debt will keep rising in the near term. Bachmann, who some idiots might actually vote for, said she was against it because it wouldn't repeal Obamacare. I dislike Obamacare too, but we need to be realistic. Rightsizing the country will be one long and hard fought battle, however being unrealistic will only harm the cause.

Tenn Slim| 8.9.11 @ 7:01AM

Folks, the S and P downgrades are like the termites eating away at the Fiscal Foundation.
If one has been following the Cloward Piven method of capitalism demise, we are right on target.
Overload the system, unpin the foundations, sweep the trash under the fiscal rug, feed the dependency, and watch the angst, confidence and anger build or decline.
Look for a lot more of the same till about Spring of 2012, then the Fundamental transformer will step forward with his doomsday solution. IE Total DC control.
What a country.
Semper Fi
We WILL Prevail