Standard and Poor's finally did it.  They downgraded the credit rating of the United States from AAA to AA+.  There are serious questions about the reliability of S&P.  The White House pointed out that there is a $2 trillion error in the calculations used for the downgrade.  Ths is of interest since the two other agencies failed to change the AAA status of the US. (See S&P downgrades U.S.)

Jack Tapper of ABC News reported late this afternoon:

"A third official says that S&P made a "serious mistake" in its analysis, "based on flawed math and assumptions," so the Obama administration is pushing back. But even though "S&P has acknowledged its numbers are wrong, it's unclear what they're going to do.," the official said.

"S&P's numbers were off by "roughly $2 trillion," the official said.

Fitch and Moody's reaffirmed the AAA US rating earlier in the week.

In addition to the question raised about a mathematical error, there are substantial reasons to doubt S&P for any credit rating, let alone the sovereign debt of the United States  This material is from an article on April 25, 2011.  It is highly relevant to the situation at hand.

 I reviewed the candidates for IMF head on May 23, "Old Europe" backs French finance minister Lagarde for IMF head. The traditional choice of a European to head IMF was challenged by candidates from Mexico and Asia. The United States ultimately tilted toward the French finance minister who is now in office.

The article noted that there was a controversial case pending in French court regarding Lagarde's actions as finance minister. She made a favorable ruling in a matter regarding a close friend and ally of French President Nicholas Sarkozy. It appeared that her actions resulted in an award viewed as excessive for the Sarkozy ally. The loser in that matter appealed to a French court. At the time, it was known that:

"A three judge panel of the Court of Justice for the Republic will recommend for or against further investigation by mid June. A yes on investigating Lagarde would end her chances for the IMF position.."Economic Populist, May 23

The decision was delayed and the US-European alliance pushed the nomination through. Today, the Guardian had this headline:

The compromise "is a positive step toward reducing the future path of the deficit and the debt levels,” Steven Hess, senior credit officer at Moody’s in New York, said in a telephone interview yesterday. “We do think more needs to be done to ensure a reduction in the debt to GDP ratio, for example, going forward." Bloomberg, Aug 2 (Image: Okko Pyykko)

How many times have you read or heard about the magic numbers concerning the ratio of national debt to gross domestic product (GDP)? This was trotted out by both sides of the debt ceiling debate as a fact: if the debt-to-GDP ratio exceeds 90%, the results will be dire. Therefore, our current situation calls for a crisis reaction and extreme measures to get below the magic number.

Let the word go forth from Washington!  The corporate rulers occupying our nation's capital have declared war on just about every citizen.

Have no doubt: those in the upper ranges of the top 1% of wealth in this country (aka The Money Party) want to kick you to the curb.

They want to reduce your social security and make you go broke paying for medical care.

They want to lower your wages and trash your retirement.

They ignore the clear facts that we've had negative job growth since 2000 and the situation is just getting worse.

They want to ship jobs, factories, and entire businesses overseas and give companies that do that a big fat tax credit for doing so.

They've been given so much for nothing for so long.  Now, they're ready to take it all.  It's their time!

The crazies in the United States House of Representatives would have you believe it were so.  They say fix that budget before we'll raise the debt ceiling.  If we don't get our fix, they announce, there's no deal.  We'll just default until things get straightened out. (Image: George Romero)

Let's see what would happen to you or me.  We are unable to pay our bills, unless we tap a special line of credit that we've used in the past, one that has never failed us.  We'll have to raise some money and cut some expenses too.

We're tired of paying bills and just want to stop for a while. We file for bankruptcy following all of the required procedures.  The minute we file, we're granted an automatic stay on our debt.  We are now protected, no bills to pay.

Then we get a few visits from creditors. They let us know that they know we can pay.  Other people owed money show up also and ask, what is your problem?  You owe us the money.  You can pay and you will. The combination of angry creditors and recipients of our funds forces us to do what we could have done in the first place.

We tap the line of credit, cut expenses, and increase income. We make the payments we could have made all along.  Once again, we have the choice of fixing things long term or repeating the process yet again.

Question: Why did President Obama put Social Security and Medicare on the table in the budget negotiations when 80% of the people oppose cuts to these programs?

Answer: The president is not in office to represent those people. He was selected, funded and carried over the finish line by corporate America. Look at the appointment of Wall Streeter Timothy Geithner, the bailouts, and the failure to prosecute any of the crooks who caused the current recession. He's serving the people who put him in office. Those people don't need Social Security and Medicare.

Q: Doesn't the president need to worry about reelection? Why would he risk that by going against such a large majority?

A: President Obama has no personal or financial risk if he loses his job.. He has a tidy lifetime pension and will, no doubt, be on plenty of corporate boards, not to mention the opportunities for huge speaking fees. There is less political risk than you might think. The only Republican presidential candidate who might be other than certifiable is the largely unknown John Huntsman, former governor of Utah and Obama's ambassador to China. The rest would do much more harm to seniors than Obama concessions this time around (if they materialize) and people know that.

The Murdoch's and their former chief executive of News International testified before a House of Commons committee yesterday.  Their hours of explanations can be summarized in a phrase:  we knew nothing. (Image)

Rupert Murdoch was too busy flying around the world milking his cash cow media properties to be at all involved.

Number two son James was the executive in direct command and he heard nothing.

Rebekah Brooks, editor of the News of the World at the time of the Milly Dowler hacking, completed the trifecta of ignorance.  Since she knew nothing, her very frequent contact with the Murdoch father-son team had to be, as the Fugs said, "a whole lot of nothing."

A second House of Commons hearing considered the role of the police in all of this.  Paul Stephenson resigned in disgrace recently as head of the London Metropolitan Police.  He concluded that the conviction of two News of the World phone hackers in 2007 was a "very successful" end of the investigation.  Phone hacking and other invasions of privacy, case closed.

How will they get rid of Rupert Murdoch and his toxic enterprises?

July 4, 2011 may turn into the people's Independence Day.  On that day, stellar journalist Nick Davies of the Guardian released his story; Missing Milly Dowler's voicemail was hacked by News of the World.  Twelve year old Milly Dowler had been kidnapped with foul play feared.  The Murdoch tabloid couldn't resist.  News of the World (the News) hired a private detective to hack Milly's voicemail.  Finding the mail box full, the News or its hired dick deleted existing messages to make room for new ones, all to fuel their ongoing coverage.  The deleted messages raised hopes by Milly's parents that she was still alive and using her voicemail. (Image)

The Davies story elicited a reaction of near universal shock, outrage, and revulsion.  Milly had already been murdered by the time the Murdoch paper began its illegal tapping.

The public revulsion resulted in immediate and fervent popular demands for justice.  Those demands were compounded by follow-up stories on other Murdoch media hacking.  As it turned out, the News also broke into the voicemails of war widows to capture their most intimate exchanges on the loss of fallen soldiers in Afghanistan and Iraq.   All in all, at least 4,000 citizens had their voicemails hacked to boost the Murdoch publication's circulation and profits.

Driven by broad public ire, Murdoch's empire began unraveling immediately.  He became a target for those he'd tormented, particularly in politics.  In just a few days, he became anathema for those he'd placed in power, indicating the focused intensity and force of public outrage.   Conservative Prime Minister David Cameron fell in line with Labour Party Leader Ed Milliband's call to stop Murdoch's critical acquisition of pay TV network BSkyB.  The Independent spoke of Murdoch having to abandon his United Kingdom media properties.

The crisis spread across the Atlantic when Senator John D. (Jay) Rockefeller demanded that law enforcement look into possible voicemail and other electronic surveillance of 9/11 survivors in the United States by  Murdoch's News Corporation.

There are some crimes so universally offensive that even mentioning the suspected crime  has devastating effects.  Senator Jay Rockefeller (D-WV) raised just such a question yesterday.  In a brief press statement, the Senator said:

UPDATE July 14 FBI launches investigation into allegations that 9/11 victims' phones were targeted

Les Hinton is the chief executive of Dow Jones and the publisher of the Wall Street Journal, the most prestigious and valued media holdings of Rupert Murdoch's News Corporation media empire. Hinton is implicated as a key player in at least the cover up of illegal break-ins involving hundreds of voice mail accounts belonging to news worthy British citizens high and low. Hinton was chairman of News International, the parent company of Murdoch's London tabloids and newspapers (including the Times of London), at the time of the illegal activities and police investigations. (Image)

What Happened Under Hinton's Reign?