400 North Capitol Street, NW
Washington, DC 20001
- Toll Free 1.888.564.6273
- Local 202.783.3870
Lots of finger pointing has occurred following the first-ever downgrade of the United States credit rating last week. Numerous political figures, including Sen. Kerry (D-Mass.) and the Obama administration’s former chief advisor David Axelrod, blame the Tea Party for the Standards and Poor’s (S&P) downgrading the U.S. credit rating from AAA to AA+. Some media talking heads have even dubbed it the “Tea Party Downgrade.” The truth, however, tells an entirely different story. Big spenders in Washington must face the facts that the American people have awoken and the party is over.
One day fiscal conservatives are being called “terrorists” and the next we’re being blamed for the country’s economic woes. These blame games are deliberate tactics to distract from the real issue at hand. Spendthrift politicians would much rather spread deceitful talking points than take responsibility for their actions. As columnist Jack Hunter says “it’s like blaming my bad 6th grade report card on report cards.” The failure of politicians to face economic reality is exactly why we’re in this fiscal mess in the first place.
Over the past century, we’ve faced growing deficits and mounting debt. The national debt has gone up nearly every year regardless of the political party in control. You cannot tell me with a straight face that the roughly three-year-old Tea Party is to blame for the credit downgrade. Our credit downgrade has been a long time coming. A few months ago, famed investor Jim Rogers said, “America should already be downgraded. It should have been downgraded years ago. These people, the rating agencies, have got it wrong for 10-15 years now. America is bankrupt". He now says that our AA+ credit rating is still far higher than we deserve.
The Obama administration has the nerve to question the S&P’s math. The U.S. Treasury Department said that there was “no justifiable rationale” to downgrade the nation’s credit rating. Here’s a reality check: the United States is the largest debtor nation in the history of the world. Even the largest foreign holder of U.S. debt, China, says that we are “addicted to debt.” The communist country’s state-run news agency Xinhua stated in a commentary, “the U.S. government has to come to terms with the painful fact that the good old days when it could just borrow its way out of messes of its own making are finally gone.” Perhaps the Chinese government should also follow its own sound advice.
The rating agency S&P warned us that we would be facing a credit downgrade unless Washington reduced deficit spending by $4 trillion over the next ten years. As the S&P explained in April, “while we’re mindful that the President and Congress are beginning to focus on some type of agreement and may possibly even have a broad understanding about the scale of a fiscal adjustment—roughly $4 trillion… We think—given the division of opinion between Democrats and Republicans—that will be very difficult to achieve over the next two years.” A $4 trillion cut or “fiscal adjustment” is barely anything when put into perspective. We face an over $1.6 trillion deficit this year alone.
The Obama administration actually rejected Tea Party backed legislation such as Cut, Cap and Balance which included enough spending cuts to prevent a downgrade in our credit rating. They chose to ignore the warnings and instead pushed for a debt-ceiling hike with no substantial cuts. The Obama-Boehner debt-ceiling deal offers no actual cuts—it only means that spending may increase less fast later on. S&P downgraded the U.S. credit rating just three days after the Obama-Boehner compromise was signed into law.
The price of gold is skyrocketing while the Obama administration desperately searches for someone else to blame. But it is the Obama administration, not the Tea Party, that has added $4.3 trillion to the national debt. Our mission is to restore fiscal sanity to Washington. As Sen. Rand Paul (R-Ky.) says, blaming the Tea Party for the credit downgrade is “like blaming the fire fighters for the fire.”