On the recordJuly 30, 2011
As Congress struggles to come up with this deal over government debt, we all know that all we have to do is raise the debt ceiling and that the chaos the country is being thrown into is not necessary. Simple: raise the debt ceiling, protect the credit of the U.S., and then debate how to cut our debt afterwards. We're trapped in a debate where there's another game going on over our heads, and that game involves the rating services, in particular, Standard & Poor's. Rating agencies help put the U.S. economy in the dumper in 2008. Dodd-Frank was the first effort to hold rating agencies accountable when, in fact, they should have been subject to civil fraud charges as well as revocation of their license at the SEC. Just a few months after Dodd-Frank passed, Standard & Poor's strikes back with a threat to downgrade U.S. debt, which would cost U.S. taxpayers billions of dollars a year in extra interest payments. The U.S. is sovereign. Standard & Poor's is not. When we work to raise the debt ceiling, we should also raise questions about Standard & Poor's. Maybe it's time to downgrade Standard & Poor's to junk status. ____________________
