Right-wing GOP criminals have pulled out all of the stops in order to advance their Class War against the American people. The latest obstacle to resolving the Debt Ceiling Crisis is Standard & Poors, who is now joining the GOP in their assault on Main Street as they once again abuse their standing as one of the Big Three (credit rating agencies (Standard & Poor’s, Moody’s Investor Service and Fitch Ratings). Yesterday I opined that GOP right-wing radicals were engaging in Economic Terrorism, and that allegation is being substantiated by the recent action of the corporate whores who control Standard & Poors:
The Biggest Driver in the Deficit Battle: Standard & Poor’s
Tuesday, July 26, 2011, by Robert Reich
If you think deficit-reduction is being driven by John Boehner or Harry Reid, think again. The biggest driver right now is Standard & Poor’s.
All of America’s big credit-rating agencies — Moody’s, Fitch, and Standard & Poor’s — have warned they might cut America’s credit rating if a deal isn’t reached soon to raise the debt ceiling. This isn’t surprising. A borrower that won’t pay its bills is bound to face a lower credit rating.
But Standard & Poor’s has gone a step further: It’s warned it might lower the nation’s credit rating even if Democrats and Republicans make a deal to raise the debt ceiling. Standard & Poor’s insists any deal must also contain a credible, bipartisan plan to reduce the nation’s long-term budget deficit by $4 trillion — something neither Harry Reid’s nor John Boehner’s plans do.
In other words, Standard & Poor’s is threatening that if the ten-year budget deficit isn’t cut by $4 trillion in a credible and bipartisan way, you’ll pay more – even if the debt ceiling is lifted next week.
With Republicans in the majority in the House, there’s no way to lop $4 trillion of the budget without harming Social Security, Medicare, and Medicaid, as well as education, Pell grants, healthcare, highways and bridges, and everything else the middle class and poor rely on. (My emphasis) READ THE FULL ARTICLE HERE
It’s extremely important to note that Standard & Poors, along with Moody’s and Fitch, contributed to the financial crash by neglecting their responsibility to provide a fair analysis of several of the financial instruments and other shady deals that Wall Street criminals were passing on to their investors when the housing and debt bubbles burst . I believe they were criminally complicit in their ratings – but without a credible investigation by Obama’s In-Justice Department the public will never know the full extent of their complicity and/or gross negligence and incompetence. That said, why should they have any input what-so-ever in the Debt Ceiling/Budget Crisis debates that are now dividing our Congress? They aren’t per se entering into the actual debate – but their threat of downgrading our credit rating if 4 trillion dollars (Standard & Poors) is sending shock waves throughout the global community – which to me is another example of Economic Terrorism.
Credit rating agencies such as Standard & Poor’s have been subject to criticism in the wake of large losses beginning in 2007 in the collateralized debt obligation (CDO) market that occurred despite being assigned top ratings by the CRAs.
Credit ratings of AAA (the highest rating available) were given to large portions of even the riskiest pools of loans. Investors, trusting the low risk profile that AAA implies, purchased large amounts of CDOs that later became unsellable. Those that could be sold often took staggering losses. For instance, losses on $340.7 million worth of CDOs issued by Credit Suisse Group added up to about $125 million, despite being rated AAA by Standard & Poor’s.[6]
Companies pay Standard & Poor’s to rate their debt issues. As a result, some critics have contended that Standard & Poor’s is beholden to these issuers and that its ratings are not as objective as they should be.
See also: 2010 European sovereign debt crisisIn April 2009 Standard & Poor’s called for “new faces” in the Irish Government, which was seen as interfering in the democratic process. In a subsequent statement they said they were “misunderstood”.[7] LINK
It is apparent that Standard & Poors, and to a lesser degree, Moody’s and Fitch, still haven’t learned their lesson in “interfering with democracy.”
