Today the Drudge Report headline broadcast that Moody is expected to cut the US credit rating linking to this article.
Lower on the Drudge page was a link that reports, Budget deficit tops $1 trillion for fourth time.
Duh, no kidding the US credit rating is going to drop. If you made $21K per year and every year for 4 years spent over $10K more than you earned you too would see your credit score drop.
If you are well capitalized, and have good credit, you can survive expenses 50% over your earnings for a year or so, but it will require a few years of spending less than you earn to pay off that debt; probably requiring you to lower your standard of living for a while. What you can’t do is keep spending 50% more than your wages year after year and stay out of bankruptcy, much less keep a good credit score. Neither can the government, it’s that simple.
Raising taxes on the rich, or for that matter the middle class is not the answer. Since WWII federal tax revenue has averaged less than 20% of GDP regardless of the tax rate. We cannot spend 24% of GDP when we can only collect 19% of GDP in revenue. It will lead to bankruptcy. Unless our government is willing to cut spending to a point where it spends less than it takes in, and soon, our government will go the way of modern day Greece.