That's a possibility for the AAA bonds of the U.S. Such a move will result not only in higher interest costs for us but a significant loss of prestige in international financial markets. This is the result of a compliant Congress and a President who believes that the world should conform to his views and wishes.
How bad is it? In 2001 when Mr. Bush took over, the Congressional Budget Office (CBO) was predicting a budget surplus of $5.6 trillion through 2011. That surplus is all gone; $1.7 trillion went in the magic tax cuts endorsed by our leaders. Another large portion, of course, has gone and continues to go to our wars. Our leaders have managed to increase federal spending by 25% during this administration. This coming year we're looking at a $400 billion deficit.
I am not optimistic, as the current crop of candidates do not seem to be overly concerned with the seriousness of our plight.
For more on this topic, read today's U.S. Wall Street Journal.
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