Anger Over Credit Rating Resurfaces in Washington

New York Times ^ | August 6, 2011 | LOUISE STORY, JULIE CRESWELL and GRETCHEN MORGENSON

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The frustration in the air was palpable. Officials from the credit ratings agency Standard & Poor’s were meeting with Congressional leaders on a stifling late day in late July to discuss the thorniest issue in Washington: the effort to cut the nation’s deficit and raise the borrowing limit to avert a default.

S.& P. and two financial industry groups listened to various proposals for debt reduction and warned the lawmakers of the impact a default would have on world markets, according to a Congressional staff member in attendance. The staff member said the agency was providing guidance on what target to hit in budget savings, but lawmakers struggled to understand the agency’s views.

Since that meeting, several lawmakers have publicly questioned whether the ratings agencies have the competence to evaluate the country’s finances, and whether it was appropriate for them to be so deeply involved in discussions of fiscal politics. The criticism reached a fevered pitch after S.& P. announced Friday night that it was downgrading America’s credit rating, a decision that thrust the ratings agencies to the center of the debate over the government’s budget, and prompted renewed scrutiny of an industry that has been harshly criticized since the financial crisis.

The ratings agencies’ purview is traditionally viewed as evaluating data and revenue projections for debt issuers, but they have long taken governance into account for ratings of sovereign nations and corporations. In its announcement Friday night, S.& P. cited the political gridlock in Washington during the debt limit debate as a main reason for its decision. “The gulf between the political parties,” S.& P. said, had reduced its confidence in the government’s ability to manage its finances.

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Entitlements are breaking our back, and no one will do anything about it.

You must understand that back-breaking entitlements are a big part of nobama's plan.

With nobama in the WH and Reid in the Senate, government teat sucker entitlements will not be touched. That does not include Social Security and Medicare. It does include Supplemental Security Income (SSI), food stamps, Temporary Assistance for Needy Families (TANF), Special Supplemental Nutrition Program for Women, Infants and Children (WIC) Medicaid, etc.

They may raise the qualifying age for Social Security, but they won't touch the "welfare" benefits. Gotta increase the size of that non-taxpaying underclass.