When the Rating Agencies Control the Government

Credit rating agency Standard and Poor’s lowered the U.S. credit rating, which had been falling below expectations. No one expected that a country the size of the United States of America would have its AAA rating lowered to AA[+]. The possibility of a credit default has come at a very sensitive time for the U.S. economy, as analysts recall that inflated ratings contributed to the global financial crisis. All trust in these institutions was lost after it became clear that they had granted various ratings to weak financial institutions in exchange for money.

The credit downgrade increased the cost of borrowing for the U.S., increasing the burden on the country and its national institutions. The value of the dollar also dropped, unemployment rose, the cost of production increased and its impact spread to markets around the world. All stock markets have been affected, collapsing in Europe, Southeast Asia and the Middle East. The real value of oil revenues and the demand for oil have gone down. The impact on incomes and development plans of the Gulf countries is a result of the recession that has hit the United States. To us, what this has confirmed is that the global economy is interconnected, just like security, terrorism, science and technology. This requires us to have more foresight regarding global crises and their repercussions for us.

It behooves us to ask a number of questions: Are these [ratings] institutions policy tools that can overthrow governments and national economies and be used for political purposes? Where did they get such power? Why haven’t we exposed these international ratings agencies and their connections? And why do our financial institutions crumble after receiving their ratings, contributing to the stability of the ratings and the instability of the world economy? Capital investment houses worldwide (billions of them) are always looking for investments with limited risk classifications, but with an irrational fear that is ever increasing. They have an influential role in the global economy; and their fear alone deprives the world of many investments.

This begs the question: Is someone pushing for capital and investment flight from the United States? Who are they? And are they paying the countries whose currencies are pegged to the dollar for the mobility caused by the concerns that they disseminated and that were subsequently broadcast by famous economic figures? Have national economies been affected to a large extent by these institutions? Is there anyone paying to reform and rebuild the global capitalist system? And is anyone creating a democratic system of financial control on a global scale?

Ben Bernanke, Chairman of the Federal Reserve, announced before Congress that the U.S.’ economic recovery can be seen in the rise in stock prices, although he indicated that the pace of recovery will be modest. However, there are three things to note about the one who declared the stock [market] recovery: 1) Ben Bernanke is a decision-maker with the advantage of economic vision, and he expected the loss of America’s excellent credit rating; 2) Bernanke does not work alone; hundreds of experts, financial institutions, research, studies and extrapolations created his speech, which has influenced the ups and downs [of the U.S. economy]; and 3) there is confidence in the U.S. economy and its ability to overcome the crisis.

However, as far as the Gulf States are concerned, how long will our relationship [with each other] continue to be a reflection of the global economy? How long will we be reactive to the global economy? Will we continue to import global inflation and pressure on our currencies? And what economic mechanism can be utilized for these changes? The rise and fall of the dollar has its pros and cons. How can we put this in the context of a strategic vision for the future of our existence, our wealth and our investments? Why don’t we see the world without America or with alternative perspectives — at a time when studies show that a hidden economic movement will lead to a reshaping of the global political system and the rise of new global economic and political powers. The problem is that we do not have the ability to follow closely and read the real variables, especially those that affect our economies.

How do we look at the West facing real economic problems? For example, France has been obsessed with debt, and Britain and Italy are crumbling. Likewise, China has been accumulating investments domestically and abroad. What should the next economic and political move be? Where are our economic, political and strategic centers that can give us the true indicators and help us to maintain Gulf investments, prevent degradation and help manage the wealth and success from oil revenues for future generations, instead of remaining a consumer society? Who knows the answer?