During his remarks about the S&P debt downgrade President Obama said it was known that a, “threat of default used as a bargaining chip could do enormous damage to our economy and the world’s.”
Here is the video from NBC News:
Obama said, “On Friday we learned that the United States received a downgrade by one of the credit rating agencies. Not so much because they doubt our ability to pay our debt if we make good decisions, but because after witnessing a month of wrangling over raising the debt ceiling they doubted our political system’s ability to act. The markets on the other hand, continue to believe our credit status is AAA…”
Later Obama called out Republicans for using the threat of default for a bargaining chip, “The fact is we didn’t a rating agency to tell us we need a balanced long term approach to deficit reduction. That was true last week, that was true last year, that was true the day I took office, and we didn’t need a rating agency to tell the gridlock in Washington over the last few months has not been constructive to say the least. We knew from the outset that a prolonged debate over the debt ceiling, a debate where the threat of default was used as a bargaining chip could do enormous damage to our economy and the world’s. That threat coming after a string of economic disruptions in Europe, Japan, and the Middle East has now roiled the markets, and dampened consumer confidence, and slowed the pace of recovery.”
President Obama stated that our problems are easily solvable, and then he argued for more revenues through increasing taxes on the wealthy, and tweaking the provider side of Medicare. Obama said the lack of political will is causing the problem, and criticized Republicans for, “drawing lines in the sand, a refusal to put what’s best for the country ahead of self-interest, or party, or ideology.”
Republicans knew that using the threat of default as a negotiating tactic could do enormous damage to the US economy, yet they still did it. This is the ultimate proof that Republicans are intentionally trying to tank the economy and blame Obama. It is unfathomable that a group of politicians could be so motivated by self-interest that they viewed causing more economic damage to the American people as good political strategy.
The good news is that the Republican plan is backfiring. Not only does polling show that the Republicans and the tea partiers are being blamed for both the debt ceiling and the downgrade, but Wall Street isn’t buying it either. They know where the real problem is, and they are well aware which party is unwilling to budge.
In watching cable business network coverage today, three things are obvious:
1). The market is being ruled by fear. No one can say anything to stop it. The market is in panic mode.
2). While the market is plunging, both Bloomberg and CNBC have stated the point of view that revenues are not being addressed and they must be.
3). Wall Street knows exactly where to place to the blame, and it isn’t on Obama.
After President Obama spoke, Steven Leuthold of The Leuthold Group summed up our national problem best by saying, “We may be an AAA country, but we have C+ Congress.”
With the exception of the Republicans everyone knows where the problem is, and in November of 2012 the American people are going to have to go to the polls and fix it.