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Reply #21: not to be a party pooper but they also say a large reason is not enough spending cuts (singling out [View All]

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stockholmer Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Aug-08-11 03:23 PM
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21. not to be a party pooper but they also say a large reason is not enough spending cuts (singling out
entitlement cuts many times. (their words, not mine, so please don't shoot the messenger)


http://www.standardandpoors.com/ratings/articles/en/us/...


1 'The outlook on the long-term rating is negative. We could lower the
long-term rating to 'AA' within the next two years if we see that less
reduction in spending than agreed to, higher interest rates, or new
fiscal pressures during the period result in a higher general government
debt trajectory than we currently assume in our base case.
'

snip

2 '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 also believe that the fiscal
consolidation plan that Congress and the Administration agreed to this week
falls short of the amount that we believe is necessary to stabilize the
general government debt burden by the middle of the decade.'

snip

3 Despite this year's wide-ranging debate, in our
view, the differences between political parties have proven to be
extraordinarily difficult to bridge, and, as we see it, the resulting
agreement fell well short of the comprehensive fiscal consolidation program
that some proponents had envisaged until quite recently. Republicans and
Democrats have only been able to agree to relatively modest savings on
discretionary spending while delegating to the Select Committee decisions on
more comprehensive measures.
It appears that for now, new revenues have
dropped down on the menu of policy options. In addition, the plan envisions
only minor policy changes on Medicare and little change in other entitlements,
the containment of which we and most other independent observers regard as key
to long-term fiscal sustainability.


snip

4 Standard & Poor's takes no position on the mix of spending and revenue
measures that Congress and the Administration might conclude is appropriate
for putting the U.S.'s finances on a sustainable footing.


----------------------------------------------------------------------------------------------------------------



As long as a Tobin tax on all financial turnover (with the first $1 million exempted) is not put into place, as long as the empire continues to have multiple, unsustainable war fronts (Iraq, Afghanistan, Pakistan, Yemen, Libya, Somalia, with more to come IMHO) and the police state is ramped up more and more (the two cost at least $1.2 trillion a year), there will never be a reduction in the debt, and the US dollar will go to the dustbin of history, as have all fiat currencies before it.


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