Ratings firm Standard & Poor’s cut its outlook on U.S. government debt to “negative” from “stable” for the first time in history, citing ongoing concerns over the long-term fiscal health of the country.
For those who don’t follow this sort of thing, this is exactly like your credit rating. The better the rating, the less interest you have to pay when you take out a loan. S&P is warning that unless we do something rightfuckingnow, we can kiss that rating goodbye. That would mean that the money we would still be borrowing (40 cents on the dollar for the feds) would cost us even more to float another year.
But it’s not like we got here overnight, right? This is all Chimpy McBushitler’s fault, right?
In explaining its decision, S&P said the U.S. deficit “ballooned” to more than 11% of gross domestic product in 2009 from a range of 2% to 5% from 2003 to 2008.
So all we have to do is reign in the deficit, right? They have to know that Obama the Uniter can get together with those evil Republicans and teleprompt them to do the right thing, right?
It noted the gap between both Republicans and Democrats about how to cut the deficit remains wide, saying that even if a deficit-cutting deal is reached, “there is a reasonable chance that it would still take a number of years before the government reaches a fiscal position that stabilizes its debt burden.”
S&P doesn’t “see a push for a meaningful agreement in the next two months” as the administration had targeted, Mr. Beers said in an interview. Even if there is an agreement, there is still uncertainty about the scope of any plan and how long it would take to implement it, he added.
So what’s the bottom line?
S&P said Monday it sees a risk that policy makers might fail to agree on how to address budgetary challenges by 2013, leaving the U.S. fiscally weaker than other triple-A-rated countries.
What is the S&P really saying? S&P doesn’t see a reasonable budget being signed by the president while that president’s initials are BHO. The US is in the middle of a “Yes We Can” bender in Vegas, blowing all our money on strippers, booze and gambling. The bank account is empty and the credit cards are maxed. Getting a higher limit on our credit card isn’t going to help until we come back home from Vegas.
If we want out of our budget mess, the first step is sending Obama home to Chicago or Hawaii or wherever it is he’s from this week.