The U.S. government is partially shutdown because President Donald Trump wants a wall and the Democrats don’t want one, though they supported one prior to his run for the White House.
Because the shutdown is entering its third week, the standoff could have a negative effect on negotiations pertaining to the debt ceiling. And this could spark credit rating agencies to slash the nation’s AAA credit rating.
James McCormack, Fitch’s global head of sovereign ratings, told CNBC on Wednesday:
“I think people are looking at the CBO (Congressional Budget Office) numbers. If people take the time to look at that you can see debt levels moving higher, you can see the interest burden in the U.S. government moving decidedly higher over the next decade,” he said. “There needs to be some kind of fiscal adjustment to offset that or the deficit itself moves higher and you’re essentially borrowing money to pay interest on the debt. So there is a meaningful fiscal deterioration there, going on the United States.”
He added: “From a rating point of view it is the debt ceiling that is problematic.”
The U.S. is $22 trillion in the red, the budget deficit will soon return to $1 trillion, and to service the debt will also top $1 trillion.
These aren’t exactly the greatest of numbers.
So, why would the U.S. have a stellar credit rating, especially when no one is taking the nation’s finances seriously?
Congress need to get their act together and cut spending. We waste millions of dollars on crap that the federal government has no business funding. Grants to colleges, and others that we just cannot afford. Grants.gov has 2,414 results.
Departments that we do not need. The Department of Education is administered by the United States Secretary of Education.
It has under 4,000 employees (2018)[1] and an annual budget of $68 billion (2016).[2] The 2019 Budget also supports $129.8 billion in new post secondary grants, loans, and work-study assistance to help an estimated 11.5 million students and their families pay for college. Savings over 10 years = $1.978 Trillion dollars. What makes 4% of the population so special that we should spend this kind of money to help so few. It is passed time to go back to –
The Office of Education that was a small unit in the Federal Government of the United States within the U.S. Department of the Interior from 1867 to 1972. Let the colleges provide for low income college students.
Dept of Energy savings 300 Billion Dollars over 10 years. Move most of these functions to the DoD (with no increase in DoD budget) and private sector for profit labs.
Dept of Agriculture savings over 10 years = 1.51 Trillion Dollars,
Get rid of the SNAP and other food programs and add funding to the earned income tax credit to assist poor families.
There are plenty of other things that Congress could do, like freeze spending levels for 5 years and let the economy grow so tax receipts would be positive and we could start paying down the national debt.
Cut DoD spending not increase it. In 1995 the DoD budget was 485 Billion Dollars adjusted for inflation, today it is 717 Billion Dollars – CRAZY!!!!!!