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Massachusetts Liberal

Observations on politics, the media and life in Massachusetts and beyond from the left side of the road.

Tuesday, April 19, 2011

Poor standards

We start with the obvious: why trust a Wall Street rating agency after they helped cause the Great Recession by ignoring the warning signs of overextended companies?

But even with that caveat, we should take a close look at Standard & Poor's decision to place the US economy on a negative outlook. The action hardly looks like rocket science either.

The important thing to note that warning is not one based on an imminent threat of failure -- although the Republican threat to hold the debt ceiling hostage to immediate action on longer-term solutions is key.

There is a debt problem that needs to be addressed. But it needs to be addressed in an adult manner. And while House Speaker John Boehner talks the talk, his rabid band of underlings like House Budget Committee Chair Paul Ryan refuses to walk to walk.

Until investors (including people like you and mean with retirements funds) are presented with a reasonable plan to deal with the problem -- and not ideological screeds -- the fate of the US and world economy is in far more danger than it has been in recent years as Washington spent money to get us out of a Great Recession created in part by irresponsible business practices by S&P and its ratings brethren.

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