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Charlie Vignola: Tea party to blame for credit downgrade

Posted: August 21, 2011 1:55 a.m.
Updated: August 21, 2011 1:55 a.m.

An old friend wrote me on Facebook the other day to defend the tea party, claiming it bears no responsibility for the recent downgrading of America’s credit rating, despite the months of political bickering that led up to it. I told my friend that I loved him like a brother, but that there is no way the tea party doesn’t get sole credit for America’s first-ever credit downgrade.

You know how I know I’m right? Because Standard & Poor’s, the credit rating agency responsible for the downgrade, basically says so in its news release.

S&P says the recent compromise worked out to raise the federal debt ceiling “falls short” of what’s needed to stabilize the nation’s longer-term finances. That is, it wanted at least $4 trillion in cuts to the national debt.

Now, what politician offered $4 trillion in cuts in the form of a “grand bargain” that even offered cuts to cherished entitlement programs, offering 75 percent spending cuts in exchange for 25-percent revenue increases so that the cuts would be balanced in a way that Simpson/Bowles and every nonpartisan economist agrees with? President Barack Obama offered that.

And who forced feckless House Speaker John Boehner to quash the deal? The tea party, which is not only so inflexible against taxes that group leaders branded getting rid of tax loopholes and subsidies as “tax increases,” but they insisted — insisted — that not raising the debt ceiling would have no disastrous financial consequences, that it was all fear mongering by the Obama Administration.

Guess that prediction turned out wrong, huh — what with the 634-point drop in the Dow soon after, and America’s first credit downgrade?

S&P also said the partisan stalemate that put the U.S. on the brink of default cast doubt on future efforts to reduce the nation’s soaring debt.

From the S&P news release: “The political brinkmanship of recent months highlights what we see as America’s governance and policymaking becoming less stable, less effective and less predictable than what we previously believed. The statutory debt ceiling and the threat of default have become political bargaining chips in the debate over fiscal policy.”

In other words, certain factions of Washington hijacked the debt ceiling vote and used it as a political football to get their way, convincing S&P that politics in D.C. have become too unstable, undermining its confidence that Washington can get their act together and deal with the national debt.

It was the tea party that, for the first time ever, used the debt-ceiling vote as a strong-arm mechanism to force its agenda through, in an ill-fated attempt to bypass normal legislative channels to jam through draconian spending cuts — and a Constitutional amendment, no less — in order to satisfy a small radical faction of the Republican Party that does not represent the will of a majority of the American people.

It was the tea party’s intransigence to even consider taxes as part of the solution to getting America back on safer economic footing that resulted in the drawn-out theatrics and last-minute response that have clearly rattled investors and the credit ratings agencies to the point where they finally did the unthinkable and lowered America’s credit rating for the first time in history.

The tea party takes no responsibility for any of this. If Obama had just capitulated to the group’s demands, none of this would’ve happened.

This is the delusional thinking of a hostage-taker who says, “Hey, I warned you that if you didn’t pay the ransom and change the Constitution, I’d kill the hostage —but you didn’t listen! So I stuck to my principles and killed the hostage. And you blame me for her death?!”

The other argument the tea party leaders give as to why this isn’t their fault is that they didn’t create the problem, meaning they didn’t run up the national debt. Their analogy is that the house was already burning when they came in, and they were just the ones who shouted “fire.”

That’s a flawed analogy. The proper analogy is, they entered a house made of wood, and people told them not to flick matches in the house. They blew off the warnings and threw lit matches over and over as people continued to yell, “Cut it out!” And then, whoosh, the house caught fire. And they said without irony, “Hey, the fire’s not our fault.

We’re not the ones who built the house out of wood.”

The truth is, that Democratic and Republican administrations alike have raised the debt ceiling 74 times since 1962. It was always a bipartisan vote, and it was never seriously questioned.

The one time we decide to screw around with it, the one time an angry minority faction decides to use it as a tool of extortion to push through an agenda that would otherwise be too unpalatable to get passed, is the one time that the market responds by wiping out trillions of dollars in value, and our pristine credit rating is downgraded — and will probably stay downgraded for at least the next nine years, according to S&P.

It was a reckless political gamble by the tea party, that’s taught us a valuable lesson: If you vote radicals into office, don’t be surprised when they act radically.

And if you light a fuse, don’t pretend it’s not your fault when the bomb goes off.

Charlie Vignola is a Fair Oaks Ranch resident.


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