Standard & Poor’s put a “negative” outlook on the U.S. AAA credit rating, citing rising budget deficits and debt.
“We believe there is a material risk that U.S. policy makers might not reach an agreement on how to address medium-and long-term budgetary challenges by 2013,” New York-based S&P said in a report today. “If an agreement is not reached and meaningful implementation does not begin by then, this would in our view render the U.S. fiscal profile meaningfully weaker than that of peer ‘AAA’ sovereigns.”
The US government is the entity which has the ability to create dollars, and to allow the existence of individual banks, companies and, yes, rating agencies. That a (US-based) rating agency feels presumptuous enough to say that it believes there are entity more creditworthy than the US government tells us all we need to know about the perceived power of "the markets" vs the politicians at the helm of the US government. That reactions to these news will be new calls to cut the deficit demonstrates that the capture of the government by finance is complete...
... except that government, at all times, has the power to change this. That people in position of political power choose not to use that power, and even agree with the fiction that this power no longer exists does not mean that this power no longer exists!
Just like the fact that the mantra of "balanced budgets," (used to cut on socially useful services) was thrown out when the vital needs of the country of the banks required it in 2008, and various countries like the UK and the US have gone through 3 years of previously unthinkable 10%+ budget deficits, and money was found very easily to do so, the same may happen with the chokehold financiers hold on political power: it's unbreakable until it isn't, because the "lock" is only in people's minds, and not at all in the real world...
Just look at Libya and Syria: what happened was unthinkable until people believed it was possible. We just need to work on triggering that change in collective beliefs...
