S & P calls out both poutragers and tea partiers

If we are to put any stock in the S&P downgrade (and that could be questionable in and of itself), then both the poutragers and tea partiers were wrong in their positions on deficit reduction.

First of all, obviously the tea partiers are responsible for taking us to the brink of disaster - something that clearly affected the downgrade.

The political brinksmanship of recent months highlights what we see as America’s governance and policymaking becoming less stable, less effective, and less predictable than what we previously believed.

And then there's the problem with their insistence on no new taxes.

It appears that for now, new revenues have dropped down on the menu of policy options.

But the poutragers were also wrong in their insistence that the deficit is not a problem and that ANY attempt to reduce the costs of Medicare are unacceptable.

We lowered our long-term rating on the U.S. because we believe that the prolonged controversy over raising the statutory debt ceiling and the related fiscal policy debate indicate that further near-term progress containing the growth in public spending, especially on entitlements, or on reaching an agreement on raising revenues is less likely than we previously assumed and will remain a contentious and fitful process.

...the plan envisions only minor policy changes on Medicare and little change in other entitlements, the containment of which we and most other independent observers regard as key to long-term fiscal sustainability.

And so the White House has every reason to say to all of them...I told you so.

"Over the past weeks and months the President repeatedly called for substantial deficit reduction through both long-term entitlement changes and revenues through tax reform, with additional measures to spark jobs and strengthen our recovery," press secretary Jay Carney said in a statement.

"That is why the President pushed for a grand bargain that would include all of these elements and require compromise and cooperation from all sides."