DownsizeDC.org
August 8, 2011
A Government with No Credibility Sees Its Credit Rating Lowered
By Jim Babka

Quote of the Day: “Everyone wants to live at the expense of the state. They forget that the state wants to live at the expense of everyone.” Frederic Bastiat

The recent downgrade from S&P of the federal government's credit rating is evidence that the Debt Deal was a sham. That's why I sent a letter to Congress telling them to make REAL cuts in spending using DownsizeDC.org's "Cut Federal Spending" campaign. 

You may borrow from or copy it, or send a letter of your own...

I am not surprised that Standard & Poor's downgraded the U.S. government's credit rating from AAA to AA+.

After all, why should the government have good "credit" when the politicians who run it have no credibility?

  • President Obama and the Democrats had all of 2010 to raise the debt ceiling as much as they wanted
  • The fact that they didn't even try, should've given House Republicans all the reason in the world to follow the wishes of the Tea Party -- to pass the necessary spending cuts to balance the budget THIS YEAR rather than raise the debt ceiling

In other words, this was an invented "crisis" and the debt negotiations were a sham. And the Debt Deal was biggest sham because it made no real spending cuts. Congress is bragging about projected reductions in the rate of increase in future budgets. Future Congresses, of course, will ignore those budget plans.

BOTH parties are addicted to massive spending. Members of Congress are addicted to the power of dispensing favors to their friends with money that doesn't belong to them. And they want to ADD $8 trillion to the national debt over the next ten years.

Some "debt" deal!

Rating agencies had warned that America's long-term spending outlook was the main danger to its credit rating. The downgrade from S&P is evidence that Congress didn't do nearly enough to control spending.

I hope this is a wake-up call.

And I say, don't be afraid of real spending cuts. Keep in mind...

  • The long-term fiscal problem in America is rising healthcare costs
  • And yet these costs could fall overnight by de-regulating the entire industry

And if you're worried about massive layoffs of federal workers, remember the post-WWII era . . . (http://www.thefreemanonline.org/columns/our-economic-past-the-great-escape-from-the-great-depression/)

  • The U.S. abolished wartime controls and many New Deal regulations
  • And ten million NEWLY UNEMPLOYED servicemen quickly found jobs in the civilian, private workforce

If you mix REAL spending cuts with deregulation...

  • The economy will grow faster, and more people will find work
  • The U.S. credit rating will likely be restored to AAA
  • You will likely be rewarded at the polls for helping to restore freedom and prosperity

NOW is the time to get serious about Congress's addiction to spending. If you don't, we will only see MORE downgrades of the U.S. credit rating and more economic stagnation.

END LETTER

You can send your letter using DownsizeDC.org's Educate the Powerful System.

And please help spread the word. "Like" this and Share with your friends on Facebook and Twitter. We have a Facebook Like button right at the top of this blog post.

James Wilson
Policy Research Director
DownsizeDC.org, Inc.

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