The nation is about to be rolled, mugged, robbed or however you want to say it, and there isn’t a damn thing you can do.Pundits and politicians continue blathering about who won the debt ceiling battle. Progressive radio host Randi Rhodes commented on how the President “outwitted” and “outsmarted” the republicans and Tea party. Lost in all this was the terror and subservience imposed upon all these champions by the threat that Stanard and Poor’s or Moody’s might downgrade the US credit rating. Those threats brought the Congress and President to their knees before financial institutions that have absolutely no oversight, and who have, by any reasonable estimation, abused that power egregiously.
“The International Monetary Fund, World Bank and United Nations have vast economic reach as well, but they are ultimately accountable to their member nations. The big three rating companies are regulated by no international bodies, checked by no significant competition…”http://www.washingtonpost.com/wp-dyn/articles/A5572-2004Nov22.html
Recall, it was S&P who gave favorable ratings to the worst and riskiest pools of bad loans, contributing to the economic downturn in 2007 and 2008. Moody’s have AAA ratings to AIG, Lehman Brothers, Enron and Worldcom just before they collapsed.
The 14th Amendment is explicit,
“Section 4. The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned. But neither the United States nor any State shall assume or pay any debt or obligation incurred in aid of insurrection or rebellion against the United States, or any claim for the loss or emancipation of any slave; but all such debts, obligations and claims shall be held illegal and void.”
But so powerful have these corporations become that they now not only rival, but assert their power against sovereign nations, and now against the United States. Despite all of the last-minute deals , political posturing and back slapping. these agency’s say they may downgrade America’s credit rating anyway. A crazy conspiracy theory? Here are the reasons why, and just as you might have guessed, it is about the money, but about the power just as surely. Again from the washington Post series:
“…access doesn’t come cheap. From Canada to the Dominican Republic, many have complained bitterly when their bonds were graded lower than they thought they should have been and their cost of borrowing rose accordingly…there’s an incentive to rate as many nations as possible: They make money by directly billing each country for the service. At Moody’s, for instance, international operations, which include sovereign ratings, accounted for about a third of its total revenue last year, and grew by 32 percent — nearly double the growth rate of Moody’s U.S. operations.”
Which country is willing to pay more for the best credit rating? Both China and India come to mind. Members of credit rating companies sit on the boards of companies they rate, banks and investment firms among them. Who would profit most from a rise in interest rates, which is certain to happen in a downgrade. Paranoid, you say? That is exactly what the rating agency’s did to Portugal, and act nothing short of economic terrorism, when Moody’s downgraded the rating’s of financial solid companies. When citizens hurt by the subsequent financial calamity took their fight to social networking sites, those sites were coincidentally blocked in a cyber attack. It was also Moody’s who, in 1996 viciously downgraded the rating of a Colorado School District when the district refused Moody’s services, an act that would shame a mafia thug. The case was dismissed ultimately when Moody’s asserted their First Amendment rights, as their rating system is merely an “opinion.”
One of two things will happen. Either the Sovereign US government will pay the “extortion” rate I am sure will come to maintain its rating, or it will refuse and be downgraded accordingly, causing each man woman and child in this country the future financial burden the tea party pretended they were trying to protect against. Then again, maybe the best option is for the government to obey the Credit rating Agencies, as Glenn Beck laughed about on his show. Down on your knees America and pour out your wallets. Wow,something even Osama bin Laden couldn’t make happen…or did he?
See, this is why we need a big government, so it can’t be bullied and humiliated, as it has been in this so-called crisis.