Washington's incompetence is perplexing, given America's aspiration, in every other endeavor, to be innovative and best in its class. Yet when it comes to politics, the U.S. historically cannot deliver decisiveness, transparency, accountability, or alignment with the public interest.
Regardless of how the current debt ceiling circus act plays out, don't be surprised to see what happens to Uncle Sam's credit rating as potential lenders to a government living well beyond its means start figuring all of this out.
If the Congress and the president don't agree on a budget, expense reductions and revenue increases for the next 10 years before the new year, they will have violated their fundamental duty, and they and their parties should be punished at the polls.
Think of what would happen if you lived in one of the 58 developing countries that remain unrated by Standard & Poor's, Moody's and Fitch. You would have very limited access to capital and investment, and the cost of borrowing would be significantly higher.
Standard & Poor's demonstrated its loss of confidence in the ability of Washington to get its financial house in order by downgrading the U.S.'s bond rating. Much the same scenario has been playing out in the U.S.'s approach to Israeli-Palestinian peace.
The global economy is weak and still weakening, while policymakers seem unable or unwilling to marshal a reassuring response. From the United States to Europe to Japan, economies are stagnating, and governments are tightening the straits by cutting back on spending.
The fact that the rating agency Standard & Poor's downgraded the U.S. credit rating from AAA to AA+ a few hours after the Treasury discovered a two trillion (!) dollar error in their calculations suggests that their "economic analysis" was just window dressing to a publicity stunt.
For too long, people in Congress point fingers at each other even as millions of middle-class Americans remain unemployed, and our economy continues to sputter. They must realize that we are all in this together.
Investors have short memories. Keeping that in mind, you might want to print this column and save it at the ready. It is timely reading this week and without any doubt will be again -- sooner than any of us want to admit.
The White House, Treasury officials and persons in the private sector who are now so publicly critical of Standard and Poor's for its downgrading of the creditworthiness of the US government are too late and off the mark.
There is something fundamentally wrong in the rating agencies' approach: they unilaterally redefined their role from doing their job -- assessing the ability of sovereign issuers to service their debt -- to rating countries.