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Credit rating downgrade brings political pot to a boil

America’s historic loss of its top-notch credit rating failed to cool the feud between Republicans and President Barack Obama‘s Democrats which threatens to drive the US economy into disaster. Despite being rebuked by ratings blue chip Standard & Poor‘s over political “brinkmanship,” US politicians dug deeper Saturday into inflexible positions on spending cuts, deficits and tax policy. The humiliation of seeing a AAA rating tumble to an AA+ with a negative outlook had the potential to further damage Obama’s weakened presidency as well as his Republican foes in Congress who polls show have forfeited public trust. Obama was already diminished
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The credit rating downgrade: What does it all mean?

The real danger from the downgrade of U.S. government debt by Standard & Poor‘s isn’t higher interest rates. It’s the hit to the nation’s fragile economic psyche and rattled financial markets. S&P’s decision to strip the U.S. of its sterling AAA credit rating for the first time and move it down one notch, to AA+, deals a blow to the confidence of consumers and businesses at a dangerous time, economists say. The agency is “striking at the heart of what makes the global economy tick,” says Chris Rupkey, chief financial economists for the Bank of Tokyo-Mitsubishi UFJ. “It isn’t just
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U.S. credit rating downgraded: Blame game begins

Republicans and Democrats quickly doled out blame to each other for the first-ever downgrade in the nation’s sterling credit rating, an expected but unsettling move that further clouds prospects for the recovery of the fragile United States’ economy. The back and forth came after Standard & Poor‘s, one of the world’s three major credit rating agencies, cited “difficulties in bridging the gulf between political parties” as a major reason for the downgrade from U.S.’s top shelf AAA status to AA+, the next level down. The rating agency has essentially lost faith in Washington’s ability to work together to address its
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Tea party: A boon or boondogle for Republicans?

The tea party is here to stay. The 2-year-old phenomenon’s muscular role in the debt-ceiling crisis made that clear, despite earlier predictions it would fade away when the national furor over health care cooled down. Now the GOP establishment wonders if the grass-roots movement will power Republicans to new victories in 2012, or dash them on the rocks of unbending ideology. One thing is obvious: The tea party already is reshaping the Republican Party. Once-moderate lawmakers are shifting sharply right, fearing primary challenges more than Democratic opponents. And most GOP presidential contenders have positioned themselves to the right of party
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Public disapproval of Congress at all-time high

Disapproval of Congress rose to an all-time high after weeks of rancorous partisan battles over raising the U.S. debt ceiling took the country to the brink of default, according a New York Times/CBS News public opinion poll published on Thursday. A record 82 percent of Americans now say they disapprove of the way Congress is doing its job, compared with 14 percent who approve, the poll found. The disapproval rating for Congress was the highest in the 34 years the question has been asked in the poll and up from the previous high of 77 percent set in May 2010.
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Global stock meltdown: Is another recession on its way?

Stocks around the world tumbled Friday ahead of crucial U.S. jobs figures, continuing a losing streak reminiscent of the aftermath of the collapse of U.S. investment bank Lehman Brothers in 2008. Growing panic about the debts of big eurozone countries like Italy and Spain, paired with fears the U.S. may be heading back into recession. Jobs figures later could well go a long way to determining whether the U.S. economy is indeed on the point of shrinking again. The biggest one-day points decline on Wall Street since the 2008 financial crisis Thursday carried into Asian and European markets Friday, taking
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Senate set to break FAA deadlock

The Senate is poised to pass legislation ending a two-week partial shutdown of the Federal Aviation Administration that has cost the government about $400 million in uncollected airline ticket taxes and idled thousands of workers. A bipartisan compromise reached Thursday cleared the way for the Senate to approve a House bill extending the FAA’s operating authority through mid-September, including a provision that eliminates $16.5 million in air service subsidies to 13 rural communities. Senators have scattered for their August recess, but the measure can be approved Friday if leaders from both parties agree to adopt it by “unanimous consent.” FAA
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American public thinks the debt deal sucks

President Barack Obama and Congress may have a debt deal that averted financial disaster — for now — but many Americans think the deal will make the economy worse, not better. Only 17 percent of those questioned in a USA/Gallup Poll taken right after Obama signed legislation raising the debt limit think the deal that emerged after months of rancorous debate and gridlock in Washington think the agreement will improve the economy. Some 41 percent believe the entire debacle will make things worse. The rest said they don’t know what will happen. And more of those polled said they didn’t
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Obama can talk jobs but he can’t fix the problem

The United States has a jobs problem and there’s not a lot President Barack Obama or Federal Reserve Chairman Ben Bernanke can do about it. In the face of rising risks of a recession that could imperil his re-election chances next year, Democrat Obama wants Congress to extend a payroll tax cut and emergency unemployment benefits that are due to expire in December. But the Republican-controlled House of Representatives is emboldened by budget concessions it made Obama swallow to lift the country’s debt limit this week and he has little political leverage to win significant fresh spending to aid growth.
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With debt deal done, Obama hits campaign trail

President Barack Obama will take a three-day campaign-style bus tour through the American Midwest this month, as he tries to refocus attention on jobs seen as vital to his chances of winning re-election in 2012. The president will be on the road between August 15 and August 17 “listening” to the American people about jobs and the economy, White House press secretary Jay Carney said. Obama’s approval ratings have been dented by persistently high U.S. unemployment and acrimonious negotiations in Washington to raise the country’s $14.3 trillion debt ceiling. These talks dragged on for months and hammered the stock market
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