Writing on the Wall: S&Ps Credit Rating Downgrade

Can you hear that? That odd noise that sounds like a fiery finger scratching on the palace wall? That's the sound of the US Credit Rating being downgraded. Earlier this week, in an event that passed unnoticed by those of us who do not belong (at least professionally) to the chattering class...the Chinese credit rating company Dagong said it is sending our credit rating down to an A rating based on our ridiculous looking account books.

At the end of the week came an event that garnished more attention: Standard & Poor downgraded the US Debt from AAA to AA+. The other two large firms, Moody's and Fitch, say they will hold the AAA rating for now...but have put us on notice that they will be watching.

Last week, the Republicans rammed a debt deal down the throat of Democrats...despite the fact that they still hold the White House AND the US Senate (by a whisker).

Is this the end of America? No...but it definitely feels like we're sitting down to dinner with Belshazzar: The writing is on the wall.

Of course, after the S&P downgrade, both political parties started to get their talking points out: Michelle Bachmann said Treasury Secretary Timothy Gietner should resign and House Speaker John Boehner (pronounced "Boner"...we still speak English here at Rip and Read, not German) said Democrats can't run anything. (This despite the fact that Republicans have been in charge for MOST of the past 30 years, during which this crisis grew.)

Meanwhile, the Obama administration...ever inspiring...began to whine about the fact that S & P should not have so petty, adding that it was really mean, and pointed out a 2 trillion dollar accounting mistake in Standard and Poor's numbers...according to Bloomberg, an unidentified spokesman from S&P responded that the mistake speaks for itself...which I can only presume means that, when a debt is SO LARGE that two trillion dollars can be overlooked....then your country doesn't really have a leg to stand on at the complaint department window.

(Vladimir Putin , by the way, weighed in...calling the US a Global Parisite...such a sweet guy.)

In the end, of course, this has been the natural result of the long term Republican Strategy of "Starving the Beast"-- George W. Bush rammed through a tax cut AND fought two wars...when the Republicans seized Congress, they did away with PAYGO- a measure put in place during the Clinton years which required Congress to find new funding to pay for ANY new programs OR Tax increases.

Back February of 2009, I wrote that the Democratic party had lost the battle for the latter half of the 20th Century...the GOP is halving everything it's own way, despite Barack Obama's victory in 2008, despite the recent lesson of the cost of the Bush years...

We who are just to the left of center are going to need to come up with a new strategy... otherwise, the handwriting is on the wall.

In the meantime, we got a debt Ceiling bill last week that does NOTHING to solve the problem... Emmanuel Cleaver (D-MO) called it a "Satan Sandwich"...

Here's my take...

OIL! Oil oil oil

Oil is once again dominating our thoughts. John Boner...ooops, sorry, BAYner (but it's spelled Boehner) is grinning all over the news saying that if Oil prices don't go down, Barack Obama won't win reelection.

I got an email from the local tea party, it reads:

$6.00 Gas Coming?

Gas has already hit $5.00 in a few places in the US. A year ago, it was $2.87. Obama says the increase is caused by "mideast instability" and speculators. We think it's inflation & inadequate US domestic production.

The government takes every opportunity to choke off our domestic oil supply.

And you thought it was supposed to be government for the people.

Wow! The Government is CHOKING off our oil supply... they must REALLY hate us.

If only we could let those POOR OIL COMPANIES free... they would help us.

But wait...last year, EXXON MOBILE MADE $30 BILLION DOLLARS...PROFIT. PROFIT! That's what they made AFTER they paid their operating expenses. That's money they KEEP. Oh, and the government, that bad old Government that is Choking off our oil, actually handed out 4 BILLION DOLLARS in Federal TAX BREAKS!

And get this, according to CNN...Exxon's profits for THIS year are expected to DOUBLE...to $60 Billion.

Now, presumably, the only reason the Tea Party is willing to put the livelihood of it's fellow Americans at risk by drilling off their beaches (and spills affect tourism, fishing, real estate, you name it.)or mortgage our children's environmental heritage (imagine: in place of the Alaska wilderness, we get an oil soaked wasteland)...is because they are betting that, if we found more oil, the natural economic laws of supply and demand would kick in and lower the prices....

But wake up people...the normal laws of supply and demand are NOT operating here. A fair profit is one thing, but THESE profits are obscene. The game is rigged. There is no reason to risk environmental devastation to further subsidize a rigged game.

Tea Party Types are fighting mad, but as usual, they are not looking in the right places.

OMG! Has the White House Got it Wrong AGAIN???

ALEX's BLOG:

NOTE TO WHITE HOUSE: BIPARTISANSHIP DIDN'T WORK: you held out your hand and the GOP spit on it...and then they complained that you tried to touch them with a spitty hand!

Okay, just last night, as I watched John Boenher slur his way through a victory speech, I looked for some silver linings...and I found one: now that the GOP holds the purse-strings in the House, they will actually have to DO something, rather than carp, complain, and pretend that this is not their mess in the first place.

I am very confident that, by 2012, the seeds planted in 2009 will begin to pay off for Democrats, while Republican efforts will bring absolutely no relief to a nervous American people. Making 2012 a pretty good year for Democrats...and allowing them to finish the work they started. We need to get this country BACK ON THE RIGHT TRACK...we need to re-build our neglected infrastructure, incubate the industries and energy sources of the future and set ourselves up to compete with China and India...so that we do not wind up as a second rate power within the next three decades.

The only thing that really needs to be in place to make this happen is a White House Communications Team who understands that we are fighting for the future of our country...and that we are in a fight against a party who is completely wrong, and so completely bullheaded that they will never realize it, they will never compromise, they will never surrender. We must, therefore, do the same. Draw the Sword and toss the scabbard. The White House needs to cast itself as the underdog, show the country how arrogant and ignorant these republicans are and...FIGHT! (Have I said that before?)

But this morning...I have to admit, I'm a lot less optimistic than I was last night.

The first thing I read was this headline:
"White House aide: President Obama will heed election message"

The text doesn't get any better:

A top aide to President Barack Obama said not to look for a change in his “fundamental principles, but certainly there were messages that have to be heeded, and we will.”

“If you believe in democracy, we were swept in by a big wave, so you have to pay attention to these results and what people are saying,” the aide said. “They want us to work together, to focus on the economy – for jobs and growth — and we’re going to do that.”

The tone was more humble than is customary for this White House, and the aide promised a period of introspection.

The aide also mentioned deficits as an area that the parties can do a better job of working together.

JEESOM H FREEKING CROW!!! A better job of working together? What freaking planet is the "aide" living on?

And where have they freaking been for the last 20 years? When Republicans get their asses handed to them, they don't go talking about "working together"....HELL'S NO!

Republicans get Whooped, and immediately they go put their big boots on and start stomping around like they OWN the place! They start talking trash, throwing rocks, and pretending like they actually won...and nine times out of ten, it works. My god, by February of 2009, a mere month after Mr. Obama took office, you'd think the freaking GOP had actually WON the election of 2008!

But our Team Of Leaders in the White House is "Humbled" and talking about "working together"...

Look, kids: That's what you said when you WON in 2008. And I have to admit, that whole Bi-partisan reaching across the aisle thing...it was a nice try, it showed class...really, it did. But it didn't work. Again, in case you missed it: IT DIDN'T WORK: you held out your hand and the GOP spit on it...and then they complained that you tried to touch them with a spit covered hand!

If it didn't work then, what the hell makes you think it's gonna work NOW?


Look, Democrats...the policies are GOOD. They are working and will continue to work. But you are going to have to FIGHT.

Because that is what the other side is doing:

Boehner and many Republicans floated some conciliatory messages toward Democrats on Tuesday night, but many factions of the party, including those closely aligned with the tea party, remained defiant. Two leading tea party leaders -- Sarah Palin and South Carolina GOP Sen. Jim DeMint -- insisted that the election results were more an argument against compromise than a case for working with Democrats. "The GOP has to understand, that machine has to understand, we are not sending Republicans … to D.C. to sing Kumbaya with Obama," Palin told conservative talk show host Laura Ingraham. "We're sending them to stop Obama!"

That's a clear a declaration of war as you could possibly want... so stop showing up dressed for tennis, Mr. Obama, and come dressed for all out combat...

It Could have been better, It could have been worse

Alex's Blog-

It's about midnight, and I just returned home from the DFL Victory rally downtown. All in all, mixed emotions...on the local level, Kim Norton and Tina Leibling are returning to the Minnesota House...but we lost two great public servants, State Rep Andy Welti and State Senator Ann Lynch.

My main hopes for the night, however, seem to have been fulfilled...no Emmer, no Demmer (my wife has remarked often how much that sounds like Dumb and Dumber...). Our Congressman, Tim Walz will be returning to the US House...despite the fact that big GOP groups (or, more accurately, small groups of big donors) dumped a ton of money in to the district to try and unseat him. The word's not in yet, but it also looks like Mark Dayton, DFL, will be our new governor.

And, on the national level...we've kept the Senate.

Of course, we lost the house...and sitting through John Boner.....whoops...Boehner's speech was painful...the media now says he was trying not to cry...but I'm wondering if he was trying to just get his lips around one too many scotch and soda's.

In the end, the fact that the Republicans have now taken control of the US House may be the silver lining...in two years, assuming that the White House finds a communications team that can find it's ass with at least one hand....the American people will have seen that these guys and gals don't have a clue...there will be no jobs...a lot of hair brained schemes to cut taxes for the wealthiest Americans...and the stimulus programs will be cut...I think that, by then, the American people will realize that they have been had. We'll see...but that's my guess...and I'm willing to put money on it: Tonight's results will see the Democrats back in the White House in 2012.

POSTSCRIPT: And it just gets better...they say that there is a movement to draft Michelle Bachmann into the leadership....LET HER AT IT, I SAY! She'll do for the GOP what Christine O'Donnell did for masturbation.

The Wingnut Gospel: Obama will Kill Small Business

Yesterday, Media Matters, published a great article entitled "Washington Post and New York Times let Boehner revive small business tax falsehood." I encourage you to read it.

Sometimes, however, even greater insight can be found in the comments than in the article which prompted them...here are some of my favorites...

From Nerzog:

I guess the Replutocrats think that if they keep repeating this lie, the Media will stop bothering to correct them..... oh, wait, it's already happened.

The Democrats need to take it upon themselves to publicly debunk this myth as often as it takes. As media savvy as they are, Obama's team doesn't seem to realize yet that the Replutocrats own the media, and they'll have to find alternative means to get the truth past all the bullsh*t.

I particularly like the term: RePLUTOcrats....and think I shall adopt it.

And here is another insightful comment, this one from Snoopy:

My experience these last few years is that tax cuts puts more operating capital into the owner's pocket who in turn uses that capital to outsource manufacturing to china and india, thus putting even more capital into his pocket. Who needs quality when you've got 3 billion potential customers who think transister radios are awesome technology!

A great discussion on corporate vs. personal taxes took place between neon desert and nerzog . Here's the take-home:

I was under the impression that incorporation legally segregated the individual from the business, thereby protecting personal property from liabilities incurred by the business.

That being the case, anyone making >$250k/yr from their small business who hasn't incorporated should be assessed a stoopidity surtax anyway.

You said it, buddy.

And last but not least, some great advice from Col. Harlan Sanders (no, probably not THAT one):

These are the questions I keep asking the conservatives on this issue. I'm just going to copy from a recent thread;

Do you own a business? If so, have you ever let an employee go, or decided not to hire a new employee because your taxes were raised?

Do you work for somebody else who has done these things?

Do you know anybody personally who has?

Friend of a friend?

anecdotal?

Fictitious right wing email claiming to?

An example , with the essential numbers in revenues/expenses that is feasible?

Cheney2012, to his credit, at least tried to fake a generic anecdotal answer;

"I have known several business owners over the years who have SHUT DOWN completely because of increases in taxes."

What I never get is a credible example. I've owned a small business, I've worked for small and large companies, and have never seen an employer eliminate or add a job because of taxes. It's part of the Wingnut Gospel, and is used as a given, a starting point for their arguments, something that happens all of the time, but something that I've never seen a real world example of.

I'm not saying it's impossible, I'm just asking that anybody who wants to use this as a common occurence cite some reality-based example. Maybe some numbers, some specifics on the company, where were the revenues and expenses when this company decided it was better to pass up those profits than to pay taxes on them.

I've seen taxes used as an excuse by people who couldn't run a business, maybe that's the bottom line.

Great Discussion.

It isn't "YOU"-- It's "THEM" : John Boehner Defends the Wealthy

Just remember this:

When a Republican says "You"- He (Or she) really means: "Them".

Yesterday, I heard House Minority Leader John Boehner declare, that "The era of big government is back and Democrats are asking you to pay for it".

YOU! YOU WILL PAY! YOU!

As I contemplate an uncertain world and the possibility of layoffs, these words would tend to strike fear into my heart...I AM GOING TO PAY? ME? I CAN'T AFFORD TO PAY!

But then I remember- Obama's "Tax Hike" is aimed at those people who make A QUARTER MILLION DOLLARS A YEAR or MORE...I don't make anything CLOSE to a QUARTER MILLION DOLLARS a year...think of it, every 4 years, you earn a million dollars...nope, that's not "me"...

That is Not Me...and, what's more, that is not anybody I know... and I even know some people who are pretty comfortable with what they make...Doctors, Small Business Owners, etc.

So, when John Boehner points his finger straight at the camera (I heard him on the radio, so I'm imagining that part) and declaims in that big deep, stiff voice: YOU ARE GOING TO PAY!

You have to stop and ask yourself: YOU WHO?

And the answer comes back: The Wealthy.

Okay- well, that might still be bad. Don't the wealthy create jobs for the rest of us? Through their entrepreneurial energy, or at least through their mindless conspicuous consumption, don't they serve as the economic engine that takes us where we want to go?

Isn't it worth our while to appease them with Tax Cuts so that they continue to shower us with their largess?

My answer, is, of course: No.

Why not?

Simple: We are not getting our money's worth out of the rich.

It's a good theory, and very seductive (especially if you're rich...it's also quite flattering)...but it just hasn't proven to be the case.

There has been advancement, too be sure, and, until the current crises ripped the mask off, it was possible to say that a rising tide raised all boats.

But some boats rose much faster and further than others.

For most of the latter half of the 20th century, and the first 8 years of the 21st...the American people, and particularly the American Wealthy, have enjoyed some of the lowest tax rates in the world.

As a people, we have excused the wealthy from a large portion of their financial duty as citizens and, instead, have passed that debt on to ourselves in our old age, or to our children. We did this in the hopes that the wealthy will commit that money to stimulating the economy, providing jobs and raising the standard of living for us, their fellow citizens.

I would submit that this plan has not worked.

The Gap between the rich and the poor is growing, and the United States has "the highest inequality and poverty in the OECD after Mexico and Turkey, and the gap has increased rapidly since 2000."

And, as Republicans have fought to save the "Estate Tax"- they have worked to ensure that this gap is passed on to the next generation. The odds are, now, that if you are born into the lower middle class, you will stay there...and if you were born wealthy, you will die that way.

What does that mean?

It means that a poor person would have to possess almost superhuman amounts of entrepreneurial energy (and experience rare good fortune) to raise themselves to a higher level. I'm not talking about common sense and hard work.. I'm talking about Genius, and we all know that the good Lord don't hand that out on anything like a regular basis.

It means that those who are born to wealth and power will have not earned it through hard work, or intellectual ability.

It means that the United States will, increasingly, be run by people who were born in to their positions without earning either experience or wisdom.

I would offer my opinion that this does not bode well for our democracy, OR our economic system. As evidence, I would offer the current banking crisis...this can certainly disabuse us of the notion that the wealthy are smarter about money than the rest of us.

By going along with this Republican plan, we, as a people, have paid a great price...and we are passing an even greater price of debt along to our children.

A few days ago, I wrote about how the Republicans used the cry of "TAXES BAD" to tempt us into this mess...

And now, to borrow a phrase from the man who set us on the path, Ronald Reagan, we can point to Mr. Boehner and say: "There you go again....."

We can't afford it this time.

So, if you are slightly panicked when you hear John Boehner say "YOU" just remember-- he isn't really talking about you. He's talking about "Them" and we've let them have enough. The experiment didn't work, and it's time to put this country, and ALL of us, back on the right track.