From Human Events:
President Obama already brought you a historic credit rating downgrade for the United States from Standard & Poor’s. Our next downgrade from Moody’s is on tap, and coming our way next year.
The Financial Times that budget negotiations in 2013 will “likely determine the direction of the U.S. government’s Aaa rating. If the ratio of federal debt to GDP doesn’t decline, they may decide to reduce America’s credit rating to Aa1. And they’re worried that the “fiscal cliff” Obama and his party are happy to take us over, because they didn’t get to raise taxes, will “cut U.S. growth by as much as 5 percent, sending the economy into recession.” They’re also unhappy that we’ll actually run through the new debt secured by the Budget Control Act of 2011 before the end of this year.
Standard & Poor’s is also thinking about downgrading the U.S. again, and the third big international agency, Fitch Ratings, has posted a negative outlook. The bond market grew understandably nervous after Moody’s issued its warning.
The Financial Times quotes economist Chris Rupkey of the Bank of Tokyo-Mitsubishi warning, “First S&P and now Moody’s is threatening to lower the boom if Congress does not come up with a credible plan to bring down what the rating agencies think is reckless deficit spending with no end in sight.” The last plan didn’t work out terribly well, what with the farcical “Super Committee” and sequestration and all. And Congress might have called it the “Budget Control Act,” but the federal government still doesn’t actually have a budget – Senate Democrats haven’t produced one in 1,231 days.