U.S. Credit Downgrade: What Obama Should Do

The U.S. downgrade is no longer a hypothetical. It happened.

What to do now, from J.D. Foster, Ph.D.:

President Obama and the Congress have the time and opportunity to change the course of fiscal policy. The United States can recover its AAA credit rating and begin to heal the damage, but it must not delay. The debt ceiling deal included the provision for the creation of a joint select committee of Congress to cut at least $1.2 trillion over the next 10 years. Clearly, that figure is much too low. The committee was to report by November 23. Clearly, that is too late. In the eyes of many, the committee was designed to fail. That must not happen.

President Obama must now do things he has been loath to do heretofore. First, he must lead. No more grand speeches, nor more politicking, no more finger-pointing while criticizing those who oppose him. Above all, leading now means corralling his forces to reach across the aisle to Republicans and work together.

Second, he should give up the ideological fight for higher taxes on anyone. For one thing, even suggesting higher taxes when unemployment is so high and economic growth is so low suggests a man more committed to politics than jobs. As The Heritage Foundation suggested at the start of his term, President Obama should suspend his desire for higher taxes at least until the economy has moved far toward full employment. The wisdom (or lack thereof) of higher taxes can be debated when Americans are back to work.

Finally, the President should forego his inclination to use entitlement reforms for political purposes. Scaring seniors about Social Security checks and related “Mediscare” tactics, which are basic elements of the Democratic party playbook, must stop. The problem is too much entitlement spending now and even more so in the near future. Republicans know it. Democrats know it. Conservatives know it. Liberals know it. The nation now knows it.

A number of sound incremental reforms can garner strong bipartisan support and can substantially improve these program’s sustainability and the nation’s finances. The President must lead his party to join hands with Republicans in the joint select committee to embrace these reforms and be ready to enact them, saving far more than $1.2 trillion and far sooner than November 23.

Obama is wrong about so much when it comes to the economy.

The Democrats are not letting up on their class warfare.

They have no intention of reining in spending. Their solution is more entitlements.

In effect, they're in a hole and continuing to dig.

This pandering and these political games have to stop.

It's time to do what's best for the country, now and in the future.

What are the odds of that happening?