Who Needs JournoList: The “TEA Party Downgrade” Edition

Image courtesy of MoveOn.org

And on Sunday morning, the minions of the administration spread out to the talk shows to incant the latest liberal mantra: S&P’s reconciling of US debt to AA+ status is a “TEA Party downgrade.”

Oddly enough, that exact wording was used by John Kerry and David Axelrod. The allegation was picked up quickly by Rachel Maddow, misrepresenting S&P’s bases for downgrading US debt by claiming that it was the result of political brinksmanship by the TEA Party faction of the House of Representatives (and nothing to do with the accumulation of debt), which actually produced budget proposals well before the due date, in contrast with the White House and Senate Democrats. Howard Dean chimed in by saying they must be smoking tea. Think Progress and MoveOn.org* were on top of the meme immediately, while Media Matters took the approach of bashing anyone who disagreed with blaming the TEA Party.

Over at Hot Air, Ed Morrissey unpacks the ‘TEA Party downgrade” characterization:

What caused the United States to lose its AAA rating for the first time in 94 years, a rating that withstood two world wars, the Great Depression and (most of) the Great Recession, and a costly military buildup that bankrupted and demolished our Cold War foe, the Soviet Union, without a direct shot fired? Was it the dastardly Tea Party, with its demands for fiscal sanity and a solution to an oncoming tsunami of entitlement liabilities? According to the man who rates sovereign debt for the agency that downgraded the US, not really:

The head of Standard & Poor’s sovereign ratings, David Beers told “Fox News Sunday” he did not expect “that much impact” when global markets open on Monday due to what he called a “mild deterioration” in the U.S. credit standing to AA-plus from top-tier AAA. …

He also said the downgrade announced on Friday was not due to the budget positions of any political party and that on any future agreement, “We think credibility would mean any agreement would command support from both political parties.”

So a lack of consensus was part of the problem for S&P. But consensus about what?

Beers called the U.S. Treasury Department’s criticism of the credit rating agency’s analysis a “complete misrepresentation.” Even with the debt limit agreement passed by Congress, he said, “the underlying debt burden of the U.S. is rising and will continue to rise over the next decade.”

Actually, the Tea Party caucus in Congress had it right. The bond raters needed to see the US take a significant step towards ending deficit spending and getting future liabilities under control. The problem with the lack of consensus came from the resistance of Democrats to the fiscal realities of the situation we face. Instead of addressing the real problems, Democrats blocked any attempt to deal with the entitlement crises and would only agree to address discretionary spending.

Very little in the way of political spin makes me angry, these days, I’ve become so inured to it, but this willful misrepresentation of what the underlying problem is does. It is absolutely contemptuous of Americans’ intelligence. The vast majority of Americans understand, quite rightly, that it is the inability of politicians to stop spending that has caused this crisis. To claim otherwise is to blame the consequences of the behavior, rather than the behavior itself, and the pooh-poohing has emanated even from some corners that I generally credit a great deal:

Look no further than the price of the 30-year US Treasury bond over the last six months. Translation: they don’t care what the damaged credit ratings agencies say — especially one like the S&P that rushed to insert itself into the political discussion while making reported math errors and ignoring them.

Well, yes, it’s no confidence booster when the S&P can’t get it’s math right, but on the other hand:

But if Standard & Poor’s can be taken at its word, the ratings agency will likely treat the results as a reason to downgrade U.S. Treasuries, even though the action will probably won’t have an immediate impact on the terms at which the Treasury can borrow. A budget-control act that actually imposed some control might not have been politically feasible, but it is certainly is feasible from every other standpoint.

As mentioned, however, even the $2.4 trillion in deficit reduction is suspect on several grounds. The cuts come in two parts. First, what is known as “discretionary spending”—which excludes the major entitlement programs, known as “mandatory”—will be $917 billion lower over 10 years than otherwise planned. In budgetary jargon, otherwise-planned refers to the “baseline” budget for 10-year discretionary spending developed in March by the Congressional Budget Office, in which huge increases were projected.

Second, there will be another $1.5 billion in deficit reduction yet to be determined by a joint committee of 12 members of Congress, equally divided between Republicans and Democrats. If this Gang of 12 fails to produce a proposal that results in new legislation, there will be automatic across-the-board cuts of $1.2 trillion in discretionary spending, Medicare, and farm and housing subsidies. So far, then, it seems there could be just a little over $2.1 trillion in deficit reduction ($1.2 trillion plus $917 billion), not $2.4 trillion.

So, the question is whether or not S&P’s skepticism is warranted, error or no error, and I wish that I could be more sanguine about the prospects, particularly with TurboTax Tim deciding to stick in the game another year and immediately going on the Sunday shows with the rest of the clowns to blame everyone but the Administration.

Pipe dreams die hard, I guess:

Perhaps the administration thinks it can create anger at S&P, and it can get flash mobs, or its allied union goons (once they are done intimidating people in Wisconsin) to come to New York State and threaten S&P executives in their homes. These S&P rating analysts are like Tea Party leaders in the “minds” of the left — they are terrorists, financial jihadists, threatening the reelection of the president, and the progressive dream to remake America into a European social welfare state, at exactly the time the European nations are coming to realize they have over-promised, and can no longer afford that vision.

And on this weekend, with his mouthpieces invading Americans’ news space, after the downgrade and the terrible loss of 30 Americans in Afghanistan, what did Obama do?

Then he and his family headed to Camp David (for a change) so he could recuperate from an exhausting week of fundraising before plunging into a Midwest bus tour, at taxpayer expense, that obviously won’t look a thing like re-election campaigning.

*For the first time in history, the U.S. credit rating has been downgraded.

This “tea party downgrade” is a shameful blow to our nation’s honor and risks throwing us right back into recession. Worst of all? It was completely avoidable.

But when given the choice between extremist posturing and responsible leadership, tea party Republicans chose wrong. And now, amazingly, they’re trying to pin the blame on Democrats.

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