Us politics

A mute, almost disbelieving response (except on the Markets) has met Standard & Poor’s announcement that the US government’s fiscal profile may become ‘measurably weaker’. The credit rating agency has put a ‘negative outlook’ on the US’s AAA rating; the accompanying report said:    “We believe there is a material risk that U.S. policy makers 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 does not begin by then, this would in our view render the U.S. fiscal profile meaningfully weaker than that of peer ‘AAA’ sovereigns.” Robert Peston tweets, “S&P’s announcement that outlook

Ed Balls has long said that America is the right comparison for Britain when it comes to how to deal with the deficit, contrasting the Obama administration’s fiscally loose policies with Osborne’s plan for fiscal tightening. This comparison has always been flawed; the dollar is the world’s reverse currency which gives Washington far more fiscal flexibility than HMG. But, even leaving that aside, the Obama administration is now — albeit under Congressional pressure — about to start cutting.   By 2015, Obama’s plan will have reduced the US deficit by 8 percent of GDP. Osborne’s plan sees Britain reduces its deficit by 8.4 percent by 2015. Indeed, from next year

After a week of hesitation and well-publicised problems evacuating British citizens from Libya, the government has led the international community’s response to the crisis. The decision to move HMS Cumberland into position was astute, as was the authorisation to rescue the people stranded in the dessert. At the UN, British diplomats have been drafting most of the key resolutions and now David Cameron has out-hawked everyone by saying he’d be willing to contemplate a no-fly zone. US lawmakers have asked the Obama administration why they have not been as swift as the UK. As a Bosnian-born friend of mine said last night: “If only David Cameron and William Hague were

Rumours abound that General David Petraeus will leave his post as commander of NATO forces in Afghanistan. Early editions of The Times quoted Pentagon press secretary Geoff Morrell saying that “General Petraeus is doing a brilliant job but he’s been going virtually non-stop since 9/11 [and] he can’t do it forever”. According to The Times, President Barack Obama and Defense Secretary Robert Gates are searching for a replacement. And, says the newspaper, there has apparently even been talk of Petraeus succeeding Gates as Defense Secretary. Really? I find it extremely unlikely that President Obama, who has had a testy relationship with the military, including Petraeus, would promote the Army officer

President Obama’s new budget proposal is an interesting moment as Obama is now admitting that the time for fiscal stimulus has passed and that cuts needs to be made. As one administration official tells The New York Times, “The debate in Washington is not whether to cut or to spend… The question is how we cut and what we cut.” Interestingly, Obama has proposed a ratio of two third spending cuts and one third tax rises. By contrast, the bi-partisan Simpson Bowles commission on the deficit proposed something very similar to the 80 percent spending cuts, twenty percent tax rises model that Osborne is using. But the most interesting contribution

The last six years have been fallow ones for the neoconservatives. From around 2005, when Iraq began its descent into chaos, the ideology that did so much to shape US foreign policy became marginalised as, first, George W Bush turned increasingly realist and, then, Barack Obama continued where his predecessor left off. While ideas are not responsible for the people who hold them, it did not help that, after President Bush left office, those who espoused a neoconservative outlook included the likes of Sarah Palin. Funding for democracy-promotion was slashed, and the focus for aid programmes became “accountability” – with the word “democracy” banished from sight. To declare oneself a