As the Dow was plummeting over six hundred points today, thus making Barack Obama's day, Standard & Poors continued their comparative anklebiting by presuming to lower the boom on the twin vehicles of the Democrat Financial Logic Bomb:
Standard & Poor's cut Freddie Mac (FMCC.OB: Quote, Profile, Research, Stock Buzz) and Fannie Mae's (FNMA.OB: Quote, Profile, Research, Stock Buzz) long-term ratings one notch on Monday.
S&P said the downgrades from the top-notch Triple-A were due to its lowering of the U.S. sovereign credit rating late on Friday.
"The downgrades of Fannie Mae and Freddie Mac reflect their direct reliance on the U.S. government," the rating agency said.
Again, I'm compelled to ask: How is it that these sinkholes, these absolute fiscal sewers, have anything but junk bond status? And this pinky-slap is a function of their "reliance" on the feds? They were nationalized, for pity's sake; that's not "dependence," that's assimilation.
Of course, that just made overt and formal the situation that always existed for Fannie and Freddie going back to their founding as "government-sponsored enterprises." It's the same reason why the Postal Service can run ads bragging about their low, flat rates; at the end of the year they simply pass the hat around Capitol Hill to make up their annual multi-billion dollar shortfalls.
The junk bond point can, of course, also be made about the federal government. But remember, this is supposed to be a "managed" collapse; an implosion that went too quickly and got out of control could take its Obamunist architects down with it, and S&P knows that all too well.
While Mitt Romney was taking every opportunity to trumpet the "failed leadership" barb at The One (which grates on my nerves because the problem isn't that Obama has failed to lead, it's the direction in which he has been leading, but I guess Mitt thinks it'd be impolitic for him to come out and say that), "famed commodities investor" Jim Rogers today baldly gave utterance to what everybody knows but nobody wants to say:
The U.S. government deserves the downgrade Standard and Poor's slapped on its ratings, because the country has run up so many debts it will never get out of the hole...
The agency is being too nice, as Washington probably doesn't even deserve the AA+ rating, Rogers tells CNBC[CCP].
"It seems to me it's physically, humanly impossible for the U.S. to ever pay off its debt," he says. "They can roll it over and continue to play the charade, but the U.S. is bankrupt."
And there it is. The worst-kept secret that everybody prefers desperately to ignore (well, almost everybody). Which is why this can has been kicked repeatedly down the road for decades in a perpetual fog of bromides about "heaping our debts upon our children and grandchildren." It's one of the sardonic slices of cynical joy.about becoming middle-aged, because when I first heard those cliches during the Reagan ascendancy, I was a tender youth, and now my children are older than I was then. Those hypothetical "future generations" are now no longer hypothetical, and STILL we hear the same cliches about running up the national credit cards of Americans not yet born (or aborted, as the case may be).
Of course, it is possible to avert Debtageddon. Simply privatize entitlements, downsize the federal government back within constitutional limitations, reinstitute market-oriented, pro-growth economic policies, and begin the long, hard slog of digging out from under all that debt. But that would require both political courage and political will, and the informed, mature willingness of a public large portions of which have been assimilated into the Obama Zombie Collective to wean themselves off the federal teat. And while the very advent of the Tea Parties shows that the courage is there, the counter-counter revolutionary will is going to be enormously difficult to overcome.
And if they are beaten down at the ballot box next November, then will come the next stage, of which the London riots are a bitter foretaste.
[cross-posted at Hard Starboard]
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