S&P not only ones upset at debt deal

Published 12:00 am Wednesday, August 10, 2011



LAPLACE – With the U.S. economy on the verge of default because of an inability to pay off trillions of dollars of debt, President Barak Obama last week signed off on legislation to raise the nation’s debt ceiling so the government could free up more money to essentially pay the nation’s bills and avoid total financial collapse.

The new law immediately allowed the Treasury to borrow an additional $400 billion, with more borrowing allowed later.  It is also intended to reduce the nation’s $14.3 trillion deficit by at least $2.1 trillion over 10 years.

The president said the agreement requires both major political parties to work together on a larger plan to reduce the federal budget deficit, but the current deal did not include cuts to social programs or tax increases, which were both considered.

In the days following the debt ceiling announcement, the stock market has plummeted, and the credit rating service Standard and Poor’s has downgraded the nation’s risk-free credit rating from AAA to AA+, leading many, including a large portion of our readers, to believe that the move was a misstep.

Last week, visitors to www.lobservateur.com were asked their thoughts on the debt deal, and nearly everyone who responded to our poll voiced concern over the actions of Congress.

About a third of the poll voters said the debt ceiling should not have been raised at all. Another 20 percent said too much political infighting watered the deal down and limited its reach.

Nearly 25 percent of the voters said the deal does not cut spending enough or in a timely enough fashion. Very few respondents said they believed the deal was exactly what the country needed.

A complete breakdown of the results follows:

• 33 percent of respondents chose “They should not have raised the debt ceiling.”

• 24 percent of respondents chose “The deal does not cut spending enough or in a timely enough fashion.”

• 22 percent of respondents chose “Because of too much political infighting, the deal was watered down and not far reaching enough.”

• 18 percent of respondents chose “The deal leaves things like health care too open to future cuts.”

• 2 percent of respondents chose “The deal is exactly what the nation needs right now.”