S&P downgraded the US credit rating today to AA+ after the markets closed. Clearly, we deserve it. Reading the comments contained in the downgrade, they are about as concerned with the political environment and the brinksmanship regarding our obligations as they are with the numbers. This is the first of many rewards sure to come for the craziness in our capitol that is welcomed by some.
Again, we deserve it. We have the lowest relative revenues in 60 years and one party - the one that ran up the debt - has pledged to leave revenues alone. That single fact should bring our rating down at least one notch all by itself. There are elements in the Democratic Party that are opposing any meaningful change to entitlements - an utterly unsustainable position. This is yet another wake up call for both parties to get it together and time is NOT on our side. We can solve this problem right now on our own terms. As each day passes, it becomes more likely that we will need to dance to the tune of our creditors.
We need to get on a path to bring federal receipts to 22% +/- and spending to 20% +/- in no more than a decade. As Bill Clinton might ask, whats not to like about balancing budgets, producing surpluses and paying down the debt?