SPRINGFIELD — Illinois, unable to solve its long-running financial problems, was given the lowest credit rating of any state in the country by Moody’s Investors Service on Friday, a move that will increase costs to taxpayers.
A second agency, Standard & Poor’s, left its Illinois rating unchanged but warned of a negative outlook that could lead to a downgrade in the future. A day earlier, Fitch Ratings also left the rating unchanged and declared a stable outlook.
Lower credit ratings generally mean the state winds up paying more interest when it borrows money by selling bonds.
Now this would be bad, but not “unexpected” as the media no doubt will have plastered all over the front page. It’s like I’ve said many times before with history and evidence to validate my claim. Socialism doesn’t work, it costs too much. I have no idea why some think “It’ll be different this time,” it never is. Until we get the socialists out of power, this will be the storyline of America.
We expect a moderate slowdown in the beginning of next year, as two small policy shocks—another debt downgrade and fiscal tightening—hit the economy. The “not-so-super” Deficit Commission is very unlikely to come up with a credible deficit-reduction plan. The committee is more divided than the overall Congress. Since the fall-back plan is sharp cuts in discretionary spending, the whole point of the Committee is to put taxes and entitlements on the table. However, all the Republican members have signed the Norquist “no taxes” pledge and with taxes off the table it is hard to imagine the liberal Democrats on the Committee agreeing to significant entitlement cuts. The credit rating agencies have strongly suggested that further rating cuts are likely if Congress does not come up with a credible long-run plan. Hence, we expect at least one credit downgrade in late November or early December when the super Committee crashes.
No, my socialist Democrat friends, this won’t be the Republicans fault. It’s your fault, your side won’t stop spending and it’s really as simple as that.
On August 4th we had a post entitled, Not since Jimmy Carter: Market declines 9 straight sessions in which we looked at the facts and determined through the data that Barack Obama is worse than Jimmy Carter but not by much. Well, that was before he managed to be the only president whose incessant and immoral spending, regulations, and other economic policies, rubber stamped by a Democrat congress, to lose the U.S. triple A credit rating. It’s not close anymore. Barack Obama is the worst president in U.S. history. And if you were still blind to what the Democrats really are, well, this news should open your eyes. They rubber stamped his agenda, remember? Some of you need to honestly answer the question, “Am I a partisan ideologue, or a realist?”
It’s not the Republicans fault. Who spent the money, crafted the policies, and is the POTUS, John Boehner or Barack Obama? Which party had a super majority in congress, Republicans or Democrats? What party controls two-thirds of the government, Republicans or Democrats? It’s not Bush’s fault. Who’s been the president for the last three years, George W. Bush or Barack Obama? Time to accept life on life’s terms folks. Oh, and those of you that elected him and to a lesser extent, members of his party, you made this possible. You voted for him. Those are the facts, and you can’t change them.
If you were sitting on a jury, those are the facts you would be presented with. And on a jury, the only thing you can look at are the facts, nothing else.
Trying to argue and explain away this mess created by those people is like 4th down and 10 from your own 6 yard line, 18 seconds on the clock, your team is down 38-0, and you believe you can pull out the win.
So what does this mean for you? Higher interest rates on everything. It’s like a tax increase that will affect everyone. Your credit card rates will go up, your mortgage will go up, your rent will go up, your car payment will go up, bank loans will cost you more, business loans will cost more which will affect the entire economy including employment, basically anything you buy on credit will go up.
What about the poor? This could really hurt them. Now what? We don’t have any money to help them anymore, Obama spent it all. They’re on their own. I already know Barack Obama’s solution. “Tax the rich.” Take from wealthier citizens and redistribute to the poor (also known as communism).
It’s not like we didn’t know this was coming. We’ve been warned for two years, but Obama and the Democrats live in denial, and just kept spending.
So what can we do? I’m not going to sound like a broken record for the 50th time. Regular readers know what I have written regarding that. Long story short, cut the size of government and eliminate entitlements and all other unfunded liabilities. It’s a simple solution.
And what about Obama? Remember I said he has an M.O.? Do you remember what I said his M.O. is? Every time, and I do mean every time, no exceptions, and history proves me correct. Every time there is bad news like this, he just “happens to be” out-of-town. He just “happens to be” on a retreat at Camp David. And I’m positive the White House is manufacturing something to take our attention off this bad news. We’ll find out soon enough.
“I told you so.” For two years I’ve been warning you readers about this, No, I’m the one that’s a flake as you losers continue living in the land of denial. It’s going to happen, we’ve been telling you to be prepared and most of you won’t, but you will have your hands out begging for help, and my motto, if you don’t help yourself, why should I help you? You’ve had plenty of warning, 2 years of lead time, soon, you’ll be on your own.
Moody’s Investors Service put the U.S. under review for a credit rating downgrade as talks to raise the government’s $14.3 trillion debt limit stall, adding to concern that political gridlock will lead to a default.
The Aaa ratings of financial institutions directly linked to the U.S. government, including Fannie Mae, Freddie Mac, the Federal Home Loan Banks, and the Federal Farm Credit Banks, were also put on review for cuts, Moody’s said in a statement today.
Do you know what that means when we get downgraded? Most of you don’t. It basically means the snowball is getting bigger as it rolls downhill. The cost of the U.S. to be lent money increases, in other words higher interest rates for us to borrow money. To make a long story short, if you think the inflation we have now is pretty bad, well, you ain’t seen nothin’ yet.
And this falls squarely on Barack Obama and the Democrats spending spree. The reckless spending of trillions upon trillions of dollars by this administration with the blessing of one particular party is at fault. PERIOD. Like I’ve said all along, this is being done on purpose, make no mistake about it. This reckless spending of trillions of dollars we don’t have, an unwillingness to stop spending and make the necessary sacrifices is the sole cause. Thank you Barack Obama, you’re doing one helluva job.
The party is going to be ending real soon folks. You better get off your dead asses and prepare, if you don’t, hey, it’s your problem. Don’t look to me for help, I don’t subsidize irresponsibility.
