In a "Fareed Zakaria GPS" segment to be aired on CNN Sunday and posted at the network's website Thursday, the host flat out lies about the current debt ceiling debate as well as when and why credit rating agencies began expressing concern about our nation's finances.
"Please understand that none of these things are happening because the United States is running deficits," Zakaria falsely claims. "We face downgrades and investor panic not because of our deficits" (video follows with transcript and commentary):
FAREED ZAKARIA: Since 1960, the debt ceiling has been raised 78 times. My basic point is that this is a crisis that we have manufactured out of whole cloth. We have created a circumstance in which the world doubts our credibility, rating agencies are thinking of downgrading our debt and the dollar's role as the world's reserve currency could be jeopardized.
Please understand that none of these things are happening because the United States is running deficits. There was no indication - by any metric - that the United States was having difficulty borrowing money one month ago. In fact, the world has been lending money to the United States more cheaply than ever before.
We face downgrades and investor panic not because of our deficits but because we are behaving like deadbeats, refusing to pay our bills, pouting while the bill collector waits at the door.
Absolute total nonsense.
The high and mighty Zakaria conveniently forgot the downgrade warning Standard & Poor's published on April 18 of this year:
* We have affirmed our 'AAA/A-1+' sovereign credit ratings on the United States of America.
* The economy of the U.S. is flexible and highly diversified, the country's effective monetary policies have supported output growth while containing inflationary pressures, and a consistent global preference for the U.S. dollar over all other currencies gives the country unique external liquidity.
* Because the U.S. has, relative to its 'AAA' peers, what we consider to be very large budget deficits and rising government indebtedness and the path to addressing these is not clear to us, we have revised our outlook on the long-term rating to negative from stable.
* We believe there is a material risk that U.S. policymakers might not reach an agreement on how to address medium- and long-term budgetary challenges by 2013; if an agreement is not reached and meaningful implementation is not begun by then, this would in our view render the U.S. fiscal profile meaningfully weaker than that of peer 'AAA' sovereigns.
That last sentence warrants repeating: "We believe there is a material risk that U.S. policymakers might not reach an agreement on how to address medium- and long-term budgetary challenges by 2013; if an agreement is not reached and meaningful implementation is not begun by then, this would in our view render the U.S. fiscal profile meaningfully weaker than that of peer 'AAA' sovereigns."
This was issued on April 18, more than three months ago. As you can see, there was nothing in this report about the debt ceiling. In fact, it wasn't even mentioned.
Quite the contrary, S&P on that day issued a negative outlook for our debt specifically due to our "very large budget deficits and rising government indebtedness."
What Zakaria is doing is depicting the crisis to be about the debt ceiling rather than the debt and the deficit, and this is utter nonsense that is totally indefensible given S&P's warning in April.
Is this the kind of blatant misrepresentation that is now tolerated at the self-described "Most trusted name in news?"
In any other profession be it law, medicine, financial services, you name it, such a blatant lie by an employee to the public would be met with the harshest of consequences.
Why is this allowed in the so-called "news" industry?
