07.20.2011 0

Moody’s and Standard & Poor’s on the Debt Ceiling Bills

Moody’s statement: “If the debt limit is raised again and a default avoided, the Aaa rating would likely be confirmed. However, the outlook assigned at that time to the government bond rating would very likely be changed to negative at the conclusion of the review unless substantial and credible agreement is achieved on a budget that includes long-term deficit reduction. To retain a stable outlook, such an agreement should include a deficit trajectory that leads to stabilization and then decline in the ratios of federal government debt to GDP and debt to revenue beginning within the next few years.”

S&P statement: “We may lower the long-term rating on the U.S. by one or more notches into the ‘AA’ category in the next three months, if we conclude that Congress and the Administration have not achieved a credible solution to the rising U.S. government debt burden and are not likely to achieve one in the foreseeable future.”

Congratulations to the House of Representatives for Supporting Cut, Cap and Balance–the only plan that actually cuts the deficit, caps federal spending and requires passage of a Balanced Budget to the U.S. Constitution. It is now the U.S. Senate’s turn.

Cut, Cap and Balance is the only plan that has:

1.      Passed either House of Congress—and with a bipartisan majority
2.      The support of over 180 grassroots organizations and over 235,000 citizens
3.      The necessary elements to cut spending and bring down the debt
4.      Savings of $111 billion in 2012 and $5.8 trillion over 10 years
5.      The ability to maintain America’s AAA rating

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