The most perplexing question that arises out of the S&P downgrade of the U.S. debt is why we’re still worrying about what they think, after all the credit rating agencies’ previous political shenanigans.
The credit rating agencies claim they are entitled to their opinions under the First Amendment, even if they are bought and paid for by Wall Street.
But anything that the S&P offers should be taken with a huge grain of salt. As James Kwak pointed out on Baseline Scenario, the S&P’s latest insights into our financial/economic/political mess weren’t exactly earth-shattering. Apparently S&P wanted us to know that they recognized we’re suffering from political gridlock in Washington.
Thank you, S&P.
If the rating agency really wanted to offer a public service, it might have pointed out that the big banks’ bundled mortgages were nothing but trash before the economy collapsed.
But of course, as we know should all know by now, S&P and the other credit rating agencies are no more interested in peddling public service any more than they are interested in offering accurate information or thorough analysis.
S&P and the others are interested in serving the interests of Wall Street, and right now Wall Street is interested in forcing its austerity agenda on the rest of us. S&P is just trying to do its small part to batter any resistance we might offer.
Like the too big to fail banks, S&P has perfected the kind of lack of shame which allows it to dispense its financial opinions with a straight face, demanding to be taken seriously even though it missed the fraud, sloppiness and greed that led up the financial collapse.
Come to think of it, there is a more perplexing question about S&P: how come a swarm of federal investigators hasn’t taken the agency down, following up on the earlier Senate investigation?
Jane Hamsher has an interesting take on that question at firedoglake, posing the theory that S&P’s thrashing of the U.S. credit rating is an effort to pay back Republicans for keeping the authorities off S&P’s back. In the bigger picture, S&P is just trying to play its part in efforts by leaders of both parties to slash Social Security and other programs that benefit the middle class under the guise of balancing the budget.
But the S&P tipped its political hand by favoring cuts to social programs over tax loophole-closing, revenue-raising, or real defense cuts. When Wall Street and its cronies need help, the credit rating agencies will always do their part.