How will the global financial markets react to S&P's downgrade of America's credit rating late Friday night? We know how the politicians are reacting. Republicans are blaming the Obama administration and its policies, but the real problem is much simpler. Tea party extremists have led the Republican party to a dangerous game of brinksmanship, where they are willing to play Russian roulette with the American economy if they don't get their way on one policy issue -- taxes. The White House knows it, and Paul Krugman writes about it in today's New York Times. He says the reason we can't fix out budget problems is because:
We have a powerful political movement in this country that screamed “death panels” in the face of modest efforts to use Medicare funds more effectively, and preferred to risk financial catastrophe rather than agree to even a penny in additional revenues.The real question facing America, even in purely fiscal terms, isn’t whether we’ll trim a trillion here or a trillion there from deficits. It is whether the extremists now blocking any kind of responsible policy can be defeated and marginalized.
And consider the pressure the downgrade will put on the debt commission. Senate Minority leader Mitch McConnell has already hinted that he and John Boehner won't name a single person to that commission who would even consider raising taxes. That, ladies and gentlemen, is our real problem: Intransigence. http://www.nytimes.com/2011/08/08/us/politics/08panel.html?_r=1&ref=politics
In 2012 news, it's the ramp up week to the Ames Straw Poll on Saturday. This past Saturday, possible Republican candidate Rick Perry prayed for America.