Senate Minority Leader Mitch McConnell (R-Ky.) appeared on CNN this morning and addressed the debt crisis that his party seems anxious to create. “Rather than thinking of this as a crisis, I think of this as an opportunity to come together,” he said.
And by “come together,” McConnell meant, “think of this as an opportunity for Democrats to pay Republicans a ransom so the GOP won’t create a recession on purpose.”
But that’s not the interesting part. This was the line that stood out.
To be more specific, McConnell said that any deal that convinces credit rating agency Standard & Poor’s to boost their prognostication on the government finances would win his support. The agency gave the government’s debt a “negative outlook” earlier this month, citing concerns over the federal deficit and debt.
“Standard & Poor’s would be a good indicator,” he said. “If they are impressed with what we’ve done, then that will mean the markets think the Americans are going to get their act together.”
Maybe now would be a good time to note that the rating agencies McConnell wants to impress aren’t exactly credible.
This item from Time‘s Joe Klein continues to ring true.
The news that Standard & Poor’s has decided to issue a warning that the US government’s AAA bond rating might be in some jeopardy if a deficit-reduction agreement isn’t reached should elicit several responses from sophisticated readers. My own threshold response is: Hey, weren’t you the same guys who gave AAA ratings to the repackaged subprime mortgage-backed securities that, in truth, were utter dreck? And didn’t that help cause the 2008 economic collapse? And didn’t subsequent accounts reveal that you were in bed with the banks whose products you were supposed to be rating? I mean, you guys are still in business? Amazing.
Not as amazing as McConnell’s willingness to hold the economy hostage until Standard & Poor’s is impressed.