As many of you know Standard and Poor’s downgraded U.S. treasury bonds from a triple A rating down to a double A plus rating. Why did this happen? We did not do enough in the deficit deal to reduce the debt and deficit in the long term. Let me be clear, President Obama was strongly pushing for a deal that included 4 trillion, with a “T”, for debt and deficit reduction, and Republicans instead of embracing the package said no. Have we heard that a few times? They are scared; (Of poor Mr. Norquist?) scared to raise taxes, and that don’t have the poltical courage to really address an issue as politically vulerable as reducing the debt. This is not Obama’s downgrade as many on the right will say. This downgrade was brought to you by none other than the Republican party. They took surplus and turned it into a deficit. There were no cries from the Republicans about the deficit crisis then during the Bush adminstration. I have no problem with the Republicans wanting to reduce the national debt, but I do have a problem when the only reason they want to reduce the deficit is when it’s not their deficit.
As you can see from the graph who really has added to the national debt? Under Democrats over the last 35 years the debt was stable; under Jimmy Carter, and under Bill Clinton the debt was reduced quite significantly. Under the Clinton the debt was reduced because of HIGHER TAXES. He raised taxes on the rich by 1.2%, he also cut spending which allowed for the U.S. to eventually balance their budget. This is the same approach we need now.
Why does the debt have to do with our credit rating? Well, the rating agency S&P said that our deficit plan to reduce the debt didn’t go far enough. And this connects with Obama because he was pushing for the 4 trillion dollar plan that Republicans backed away from. Obama tried to produce a plan, and he called for a plan that would raise taxes on the rich while reducing government spending. Obama can’t be responsible for parts of the debt, but he does have the job to fix and stabilize the debt. Something that very few people want to do. If he can rally support for his 4 trillion dollar plan that is balanced maybe the rating agencies will take another look at the downgrade. Hopefully the Republicans will wake up; the increased debt was caused by their policies they must wake up and see what the American people want. But again listening to the American people is not something that Republican look doing. At lest our debt isn’t junk, yet, as maybe Republicans would like?