THE BLOG
04/22/2011 06:38 pm ET Updated Jun 22, 2011

Good Friday

It is overcast and cold on April 22 in New York.

After a brutal winter, the lawn sports large blotches of patted down straw, a sort of sub-Arctic permafrost in a region that is supposed to have none. The heavy coats still hang in the pantry ready to be called into action yet again, unable to retire to their seasonal cedar closet. Even the dog is confused by it all. She can't catch the necessary whiff, blown away as it is by the unseasonable chill breezes that never allow spring to come.

There is just nothing good about this particular Friday.

Earlier in the week, the markets were roiled by a ratings agency report from Standard & Poors (or S&P, as they are known in the trade) that it was not at all confident that America's pols would get their act together and tackle the deficit. This has been widely reported as an initial shot across the bow by the credit markets, a warning to the borrower that the bill will come due and the lenders were worried they might not get paid. The borrower is the U.S. government. The lender is the rest of the world but at this point largely China.

My first reaction was to say "What gall!" S&P, afterall, was one of the three ratings musketeers who told us not more than five years ago that all those mortgage backed securities, three-tiered collateralized debt obligations, and insurance like credit default swaps were triple-A investments. Perfectly safe. About as likely a risk to default as the U.S. itself.

Namely, none at all.

They were not even close to being right.

Now we are all supposed to believe that the U.S. deficit, which is largely a problem that would go away if the Bush era tax cuts were allowed to expire and we were careful about not starting any more unpaid for wars, has for the first time attracted S&P's attention because it is unsustainably large.

This is pure rubbish. As a percentage of GDP, the deficit is nowhere nearly as high as it has been at times in our past. There is no danger of default, at least not one uninduced by right wing politicians in Washington refusing to raise the debt ceiling. And, to top it off, the real problem now is an anemic recovery that DC's deficit hawks threaten to kill with their hypocritical zeal to stop all non-discretionary spending. A recovery, by the way, necessitated by that near-death, near-Depression we experienced in 2008, for which S&P (along with the other ratings agencies who failed to do their job, and the then GOP government in love with deregulation, which had for eight years failed to do its) was among those responsible.

But I have now calmed down.

Because I realize that, in some sort of feat of cosmic consistency, the ratings agency's hypocrisy and gall has at least come at the right time in the liturgical calendar.

We are in what we Christians call Holy Week. As a matter of history, the week had a lot of ups and downs. It started off well enough A triumphant entry into Jerusalem from the non-Roman east, on a donkey no less, that inspired some of the poor masses. But that entrance sent the authorities into fits of worry that a city exploding with Passover pilgrims might throw off the Roman yoke. Which more or less explains the rest of the week -- a banquet of sorts with twelve very close friends, and then an arrest, show trial and killing by those same worried authorities.

Through it all, the watch word was hypocrisy. Whether it was the hypocrisy of Roman authorities trumping up charges... or of crowds choosing to save a felon and kill a saint... or of friends denying they even knew you.

There was, in truth, not much good about that Friday either.

We need a lot more honesty from the institutions that nearly killed us in 2008, which includes Standard & Poors. And they should at least start with the notion that, having been fatally wrong and egregiously self-interested in 2008, they ought not repeat the act in 2011.

The creditor class in this country and in the world is worried about their money. In particular, they are worried about the value of their assets, which happens in large part to be the loans they have made to all the debtors, most of whom are now having trouble paying them back. The creditors succeeded earlier in the decade in making it much more difficult for debtors to be discharged in bankruptcy. And they now do not want the governments of the world easing that debt burden by spending or inflating, which effectively devalues the debts and, consequently, their wealth. Standard & Poors is in glorious hock to the creditor class. The banks pay S&P and, as we saw in 2008, S&P does their bidding.

What we need most at this point is to finally hold the hypocrites to account and to start calling a spade a spade.

And what we need in our politics right now is a little...

Easter.

PS In my last post I talked about a lecture I was going to give at the end of March. I did so, at Mt. Aloysius College in Cresson, Pennsylvania. For any who are interested, view it here.