A Tea Party Downgrade?
August 8, 2011 Leave a comment
Standard & Poors downgraded the credit rating of the United States last Friday. This is the same Standard & Poors that completely missed the mortgage crisis in 2008. One wonders why anyone should take them seriously. One thing to keep in mind is that Wall Street was in the bag for Obama in 2008, now S&P turns around and whines about the lack of tax increases. While I don’t think S&P is doing any favors for Obama, keep in mind in the background most of Wall Street voted for this President.
The Democrats have decided that the downgrade is the fault of the Tea Party. Sen. John Kerry, David Axlerod, Larry Summers and a legion of House Democrats have declared this a “Tea Party Downgrade.” As though a nebulous group of people that came together in 2009 is somehow responsible for $14 trillion in debt and an unstable economy. No sir, it couldn’t be decades of wasteful spending by Democrats and Republicans. It can’t possibly be because of entitlement programs created by both parties that are bankrupting the country. No sir, it’s the people who want to cut back on the size of government who are responsible for the downgrade.
What’s interesting is that the major Tea Party favorites voted against the debt ceiling deal. Sen. Jim DeMint and Rep. Michelle Bachmann being the two biggest. On a smaller scale, more than 20 other House Republicans, most of them newly elected Tea Party members, all voted against the debt ceiling deal. This includes my new Congressman Justin Amash.
The Tea Party wasn’t to blame for the debt ceiling deal, the establishment of both parties was responsible. The establishment in neither party takes our debt crisis seriously. We all know the Democrats don’t care about massive deficit spending, their accusations that any cuts amount to terrorism is proof of that. But let’s be honest, John Boehner isn’t all that interested in cutting anything either. He’ll stamp his feet about cutting government but if the GOP wins in 2013 Boehner on his own isn’t going to initiate any cuts in government. Just like the Republicans didn’t cut anything when Bush was elected. In fact, Congressional Republicans created new entitlement programs during Bush’s first six years.
The debt this country has isn’t sustainable. Having debt at 100% of GDP and rising isn’t sustainable. The Democrats and apparently S&P want tax increases but the fact is tax increases won’t slow our debt creation and will only result in a further economic downturn. The fact is, if the Federal government confiscated every penny earned by those making over $250,000 a year they would barely get through six months of Obama’s spending.
Taxing the rich isn’t going to solve our debt problem. In fact, it will make the debt problem worse. Around 60% of our consumer spending comes from the top 2%. An even higher percentage of American investment comes from this group. If they are taxed at a higher rate, they’ll have less money to spend and invest. Who do you suppose will be hurt the most? The people who they are currently buying things from and the companies they’re currently investing in. The end result of tax increases will be a recession, just look at what happened in 1991 when Bush, 41, raised taxes. Go back further to 1930 when Hoover raised taxes and 1933 when FDR raised them even higher. The result was a prolonged depression. Raising taxes isn’t the answer.
The answer is spending cuts. We need serious cuts to the size and scope of the Federal government. We need to take a serious look at eliminating some Federal agencies, such as the Department of Education. Yes, we need to look at some cuts in defense spending. We have 11 support personnel for every soldier on the ground, during World War Two it was 7 to 1. There is room for cuts. We need to curb entitlements, we need to curb food stamps for the college aged sons and daughters of millionaires and we need to put a cap on the number of years someone can be on food stamps just like we already have for welfare. We need to repeal Obamacare before it adds to our debt in 2014.
Only a cut in the size of the government will allow our credit rating to go back to AAA. We cannot continue on with the increases in the debt that have taken place since 2007. It was bad enough when Congressional Republicans passed budgets with $500 billion deficits when Bush was President. But the amount of annual debt tripled once the Democrats took power. This sort of spending isn’t sustainable. We’re 18 months away from having $17 trillion in debt. And then what? The government will want more and more and more. One is left wondering when it will all collapse. You can bet that John Kerry will be first in like to call it a Tea Party collapse.