The real debt problem: the debt, not the ceiling
I just watched Fox’s Neil Cavuto interview a top S&P guy and break the news — which shouldn’t be all that shattering — that August 2 may not be the important deadline. As early as Monday, our credit rating could be downgraded from AAA. That’s because of what Kevin, Veronique, and Mark Steyn have repeatedly pointed out, and what Mark Levin hammered during his radio show this week: The real issue is not the debt ceiling (which is statutory and artificial) but the underlying lack of a credible plan, committed to by government, to live within our means — not just to slash spending but to address the structural drivers of spending, and to convince the markets that we will continue to pay our obligations as they come due, including the interest on our debts, which is almost certainly going to rise, soon. Simply adding $2.5 trillion to an already bankrupt nation’s $14.3 trillion credit line would not only fail to address the real issue; it would signal a lack of resolve to address the real issue. That’s the opposite of a solution.
We could start to see by the evening on Sunday, when overseas trading gets underway, whether the markets are working off the same calendar Washington is.