Democrats Are Right to Scream About the S&P Downgrade
In the aftermath of the Great S&P Debt Downgrade Democrats are screaming "foul," and, from the perspective of what is in the best interests of the party and their president, they are right, but not for the reasons they are claiming.
Backing up a bit, it is unusual to see Democrats go after the kind of pencil-necked technocratic "experts" they usually embrace in support of one policy outrage or another. It is also jarring to find one of these experts commit a Democrat-attackable offense when his firm and sector are so vulnerable to regulatory retribution i.e., via Dodd-Frank, from Democratic bullies on the Hill or in the Administration.
In case nobody has noticed, Americans care a lot about ratings. People who have had absolutely nothing to do with earning the pennant or ring love to jump up and down and torch perfectly good cars celebrating being "Number One" in this or that sport. That factor will of course manifest itself here, and, naturally, Republicans are better positioned to promise to make us a winner in the Creditworthiness Bowl, so that, once again, we can bask in the glory that France, Sweden and Austria enjoy. But there is more to it than that.
Democrats should be upset at S&P because the rating agency has just established a criterion for success that only a Republican president and Congress can attain. Democrats are so hobbled by their constituent interest groups and big government theology that they can not even play convincingly for this title, much less win it. Republicans, on the other hand, can both make winning the Creditworthiness Bowl a campaign promise and reasonably expect being able to fulfill that promise. With respectable presidential and congressional victories in 2012 they can, in fairly short order, put together a combination of regulatory, fiscal, and energy initiatives that can satisfy the credit weenies. Moreover it can be a relatively early victory that should boost the new president and stiffen the resolve of Congress to go along with more demanding tasks that will face them.
Democrats have already attributed to a bunch of little old ladies in tricorn hats the ability to shake world financial markets. Republican presidential and congressional candidates worthy of those ladies' support are all that is needed restore us to "Number One" again, and thereby position us to move forward to more important battles, with the added benefit that the attendant victory festivities are not likely to see too many cars upended in celebration.