Monday, August 8, 2011
Obama tries snake oil on S&P downgrade and even more incompetence.
Obama is trying to make an issue out of the fact that Standard and Poor admitted to making a $2 trillion error in assessing the future US debt, while choosing to completely ignore the fact that Standard and Poor made it abundantly clear that the numbers and the mistake had absolutely nothing to do with the downgrade in the first place.
Hoping to seize on what amounts to a clerical error for political purposes, the charge by Obama spokesmen that the downgrade was a "facts be damned" decision on the part of SP not only shows how thoroughly dishonest Obama can be once again, but how politically incompetent since the downgrade could have been used as a powerful political sword against the Republicans and the Tea Party ( and not the butter knife Axelrod tried to use in stupidly blaming the Tea Party for the downgrade when it was Obama's incompetence in not taking care of the debt ceiling a year earlier when the Democrats had large majorities, not to mention his 3 time capitulation on extending the Bush tax cuts and his caving in to Republicans on the debt ceiling all of which was the real cause of the problem.).
Obama's criticism of SP is simply snake oil on top of smoke and mirrors. SP made clear that the downgrade was a result of the political "brinksmanship" that allowed the debt ceiling debacle to go down to the wire, tying it to a deficit reduction plan (something Obama himself could have avoided in many ways, not the least of which was invoking the 14th amendment, something Bill Clinton said he would have done) and the fact that the deficit deal Obama struck with Republicans was, in S&P's opinion, inadequate in dealing with the deficit.
And one of the big reasons SP found the deficit deal inadequate was because Obama once again, and to the detriment of the country, agreed to a deficit reduction deal with no tax increases. He went along with the proven past failures of the Republican position which always puts ideology over the best interests of the country. Bill Clinton, over the staunch objections of Republicans, raised taxes in 1993 with the additional tax revenue earmarked for the deficit. While Republicans predicted disaster, it resulted in a zero deficit, a balanced budget and the greatest economic expansion in U.S. history.
Obama is now repeating the obvious -- that we need tax increases in order to have real deficit reduction. It was Republicans cutting taxes at the same time Bush took the country to war in Iraq, something that had never been done before -- that was the major cause of the problem in the first place. But like he has before, Obama is taking a position after the fact and after he reneged on ending the Bush tax cuts on three different occassions. .Like his 2007 about face on the Washington D.C. hand gun ban as a U.S. senator, his reneging on his promise to use public financing as a candidate, his reneging on the public option and financial reform as president, he has now turned around again ( remember "sanctimonious purists"?) and began making the case for ending the Bush tax cuts in the future.
Meanwhile the downgrade could not have been a more perfect weapon for Obama or any politically competent Democrat ( of which there seems to be none) to use against Republicans. After all it was John Boehner who boasted after the deal passed the House that " we got 98% of everything we wanted".
Even a marginally competent president or Democrat could easily make the case that getting 98% of everything the Republicans wanted, including holding the debt ceiling hostage in order to get the 98% of everything they wanted, is precisely what led to the first downgrade of American credit since 1917.
Instead of using the sword the Republicans gave him him, Obama has, as usual, tried to lay the blame for the downgrade on Standard and Poor's clerical error, something that had nothing to do with the decision to downgrade.
One can only hope that somewhere along the line the Democratic Party will finally take a page from S&P and downgrade Obama and look for credible challengers to Obama in the 2012 primaries. Because right now, both Obama's credibility and that of the Democratic Party is at an all time low along with America's credit rating. And if Obama is still the candidate in 2012 the American people will announce their own downgrade -- this one at the polls.
UPDATE: After both Geithner and an unnamed White House spokesman had denigrated Standard and Poor for two days over the downgrade, calling it a "facts be damned" downgrade,using the math error as the excuse, Obama has( what else is new?) reversed himself and in brief remarks to the press on the downgrade, dropped the attack on SP and finally and correctly attributed the downgrade to the political logjam and inadequate deficit package ( a package he capitulated to) as the cause behind SP's decision.
What he didnt mention was that every proposal for deficit reduction from Simpson-Boles to the Gang of Six included tax increases on the wealthy and the closing of tax loopholes, the one issue that Republicans were intrangient over, refused to agree to, used to hold the US credit rating hostage, and was capitulated to by Obama.
Obama's case for tax increases by eliminating the Bush tax cuts for the wealthy, something he mentioned again in his remarks were made a year ago. And he did nothing. And there is no reason to think it will change now unless Democrats can find a candidate to replace him.