S&P credit rating reduction: Is it Unconstitutional?
@BalthasarTheRat (656)
United States
August 6, 2011 2:03pm CST
A person well-versed in American Politics will reply that the Constitution really doesn't apply to a private entity decision like this one: but hear me out, please, anyway.
When the US Constitution was written, it was designed only to reel in government from doing too much damage to the public. Noone back then could imagine businesses so powerful that their decisions would have international repercusions. So even by the time of the 14th Amendment's addition, Congress and the States were the only decision making bodies that the Amendment was aimed at.
Just last weekend, the 14th Amendment was being cited as a way for the President to pay the bills despite the debt ceiling, but the wording applies even more in this case, if we could just find a way to make it stick.
"The validity of the public debt of the United States, authorized by law . . .
shall not be questioned."*
Now we have an independent ratings company doing EXACTLY THAT: questioning the validity of the US debt in terms of ability to repay.
If nothing else, Standard & Poor's is slapping the US in the face at a time when Wall Street investors are already skittish. Not a good move, and bordering on treason. Very anti-American of this all too powerful division of American McGraw-Hill.
The international aspect of S&P's decisions amount to a type of power that noone could have predicted a hundred years ago. Should we be happy that a non-government entity essentially now has a balance of power type influence on Congressional spending?
Is this market based progress or a dangerous anti-government precedent?
*(The only thing I cut out was a description of some types of debt that were current in the minds of Congress in 1868. And the next sentence, if your wondering, just says the US will not bear any of the debt from outside sources that supported rebellion against the US - in other words, the foreign supporters of the Confederacy were SOL.)
-The Constitutionist Rat
7 responses
@Adoniah (7513)
• United States
8 Aug 11
Once the US Gov. steps outside of its boundaries and borrows monies from another country, the constitution no longer holds any power over the transaction. That in and of itself could be construed as unconstitutional. What idiot gave them the power to put the US in debt to a Communist country that we do not even have a mutual defense treaty with? I could see a country like England or Canada etc., but a country that we have been enemies with our entire history? Once again, the American people have their heads in the sand and let Hussein Obomination work very hard toward our destruction....
@RBBantiles (347)
• Philippines
9 Aug 11
With due respect, you may have to hit your history books, Friend Adoniah. You need not go back so far in time, just the time of Dr. Sun Yat Sen, Gen. Chiang Kai Shek, Pres. Richard Nixon, Chairman Mao Tse Tung, and Premier Chou En Lai. Happy surfing in the web about these personages!
@sierras236 (2739)
• United States
7 Aug 11
Odd. Nothing in the US Constitution about America's credit rating. Not disagreeing with you on the fact that it is written that the Government shall be responsible for the debts incurred. More specifically, it is that of Congress. The "supposed" safeguard thrown in to prevent this kind of uncontrollable spending was the fact that all spending bills will originate in the House. Perhaps, that is what you are alluding to.
The 14th Amendment does not directly give the President the authority to raise the debt ceiling. Since the matter has not been ruled upon by the Supreme Court, it still stands that Congress is the main bearer of the debt and not the President. (The legality can still be questioned but until such time as the Supreme Court makes a decision about whether or not the President has this authority, he simply does not have it. Not directly. Such challenges would likely be delayed in any case.)
Since credit rating is based on the ability to pay, you have to wonder exactly where Congress is going to get the money to pay off the debt. It is an essential question many Americans are asking.
Credit rating is only the debt ratio as compared to the amount of revenue. Your own credit rating is calculated on the same type of basis.
The S&P is not in fact paying the bills of the American Government nor are they responsible for spending the tax revenues of the Government. Pretty much they are looking at the numbers that everyone else can see. Yes, they are asking about the ability to repay.
But then so is pretty much every American who watches the spinning numbers tick upward.
@sierras236 (2739)
• United States
7 Aug 11
One more thing, apparently no one is questioning whether or not the $14 trillion dollars is valid American debt. Certainly, not the S&P. Congress isn't disputing that the debt load is that much either (otherwise they might not have raised the debt ceiling.)
Questioning the ability to repay is not questioning the validity of the debt. It is merely a look at in versus out and seeing that something isn't adding up.
@ParaTed2k (22940)
• Sheboygan, Wisconsin
6 Aug 11
The S&P is not a US body, it's only attachment to the US is that is it recognized by our Congress and President as an arbiter of terms for international loans and debts.
The only way it can be "Unconstitutional" would be if there was something illegal about the agreement. The Constitution clearly states that Congress can borrow money, and ratify agreements with foreign bodies.
So, unless you can find some way to show there was something wrong with how the US came to recognize the S&P, then it's only an opinion.
But make your case well, and for good reason, because if you are successful in showing that it is unconstitutional, then all activities made under that agreement are just as unconstitutional. Which means havoc.
@Taskr36 (13963)
• United States
7 Aug 11
I could point out that you're wrong about them questioning the validity of the public debt, or bring up the fact that they are an international organization, but that's been done. Instead I'll just focus on the constitution.
The constitution does not apply to private businesses nor was it intended to. It places limitations on GOVERNMENT. GOVERNMENT may not abridge freedom of speech, right to bear arms, take life, liberty, or property, etc. The government can't just blow off the debt, or zero it out to pretend we don't have a debt. Trust me, other countries have actually done that
@andy77e (5156)
• United States
7 Aug 11
"The validity of the public debt of the United States, authorized by law . . . shall not be questioned."* Now we have an independent ratings company doing EXACTLY THAT: questioning the validity of the US debt in terms of ability to repay.
S&P is not questioning the validity of the debt. No one is doing that.
The 14th Amendment says that you can't question the validity of the debt. It does NOT say that you can't question the ability of the government to pay it back.
In fact it is insanity to say you can't. You really think that a government can have a debt that greater than how much the entire country produces in a year, and not question if they can pay it back?
That's idiocy.
Well if you are right, then contact the local FBI, because I RIGHT NOW... am questioning if our government can pay back $14.5 Trillion dollars, when the whole @#%*@#$ country only produces $14.1 Trillion in GDP.
Call the police. Contact the NSA. My name is Andrew Ekleberry of Columbus Ohio. I'm committing treason by speaking common sense. Come get me. By all means turn me in. Lets see how far this gets.
Most retard thread yet. 
@francesca5 (1344)
•
7 Aug 11
no, i don't think the S&P change of credit rating is unconstitutional. though i can understand your wish that it should be.
though an argument that opposing the raising of the debt ceiling was an unconstitutional act, by politicians, would be a much stronger one, i would have said. its a shame obama didn't try using the 14th amendment, as he can't allow himself to be held hostage like that.
its interesting though, because if a bill goes through both houses, then the spending that it generates is legitimate spending. and presumably the intention of that amendment was to ensure that any act passed by the houses is not challenged.
i would focus my actions on this argument on the politicians who voted against raising it, rather than spreading out my energy, if i were you, balthasartherat.
@RBBantiles (347)
• Philippines
6 Aug 11
S&P is not questioning the validity of the public debt. It is merely saying that the public debt is already so huge that the US Government's borrowing capacity is affected by the fear of possible default.
Instead of punishing S&P, the US Government should give S&P a medal.
Why? Because the downgrading of the US credit rating by S&P will have the impact of raising the interest rates in the US of the money available for loans. Investments will then flow into US banks as a result because investors will then be attracted by the potential for higher returns from the increase in interest rates. That will make more money available in the US Banking System, and in the US Treasury too because investors will then lap up its issuance of certificates of indebtedness bearing higher interest rates.
Since higher interest rates discourage private borrowers, then the field is left empty to the only entity capable and willing to borrow: the US Government.
Does this not deserve a medal, Friend Balthasar?
