WASHINGTON-Soon after Standard & Poor's Aug. 5 downgrade of the United States' AAA credit rating, defensive Washington policymakers defaulted into blame-game mode.
The U.S. Treasury Department blamed the rating agency's flawed judgment. Senate Majority Leader Harry Reid, D-Nev., blamed billionaires, oil companies, and corporate jet owners. David Axelrod, a top advisor to President Obama, and Sen. John Kerry, D-Mass., used identical language in calling the action a "Tea Party downgrade."
Republicans also engaged in the tactic: The Republican National Committee dubbed the move "the Obama downgrade" while House Speaker John Boehner said the downgrade is on the Democrats.
But state-run Xinhua News Agency in communist China, which is America's largest foreign creditor with $1.6 trillion in Treasury securities holdings, came the closest to winning the blame game when it warned that the United States must face its "addiction to debts." The downgrade to AA+, coming after Congress approved an increase in the nation's borrowing limit, proved the problem is the debt, not the debt ceiling.
Will the new rating spur Congress to step out of the partisan trenches and seek real spending reform?
That task now falls to a congressional "super committee." Under the agreement to raise the debt ceiling, this 12-member panel, evenly split between Republicans and Democrats, has until Nov. 23 to find $1.5 trillion in additional budget savings over the next decade.
The eroding confidence in Congress displayed by both the nation's voters and by its financial markets suggests that hopes are not high for the prospects for success of yet another committee. S&P, in explaining its downgrade, blamed "the lack of apparent willingness of elected officials as a group to deal with the . . . fiscal outlook."
Even if this committee somehow rises to the task and agrees to $1.5 trillion in cuts, it may not be enough: S&P said it preferred $4 trillion in savings.
The House-passed budget, authored by Rep. Paul Ryan, R-Wis., tops that figure by achieving nearly $6 trillion in federal savings over the next decade. These are accomplished by substantial changes in entitlements such as Medicare. But in an Aug. 8 speech in which he defended America as a "Triple A country," President Obama only called for "modest adjustments" in entitlements.
With the nation facing tens of trillions of dollars in unfunded entitlement obligations, a first-ever credit downgrade, plunging markets and an unemployment rate stuck at 9 percent, modest may not be the most hopeful adjective.