I appreciate the points you raised in a recent editorial regarding Standard & Poors’ assessment of the Government of Canada’s likely response to a crisis in the Canadian banking system and so tried to cast doubt on the health of the system.
Unfortunately, concern over this attitude of Standard & Poors has us barking up the dead horse. S&P is commenting on what they believe should be Canadian public policy. They are attempting to pass themselves off as economists. S&P personnel, though some may have studied economics, are not economists.
They are financial products analysts. They have no concern for good public policy.
Their concern is with policy that will benefit themselves and potentially a few of their hangers-on, although they are only an afterthought.
The problem is that when it comes to enriching themselves at absolutely anyone’s expense S&P are the smartest guys in the room.
When it comes to what constitutes good public policy Standard & Poors are capital “M”, Grade-A, Morons! (Actually, I suspect this isn’t true. I suspect they do know what good public policy would be, but that it would interfere with their ability to make themselves even more filthy rich at society’s expense.)
When they give advice to government why should these people be taken seriously?
S&P, along with Moody’s et al, are the same people who continued to rate the bundled sub-prime mortgage fiascoes as “Triple-A” investments right up until the very moment they helped drive the figurative bus of the world economy off the cliff in 2008.
No thinking person on the planet believes they didn’t see that coming. They, along with their cheerleaders on Wall Street were subsequently rescued, and enriched, don’t forget, by U.S. Government action.
So if the Government of Canada appears to them somewhat less likely to do the same, they will obviously perceive that as a threat to the pathetic lie-based construct they inhabit. Don’t worry about S&P. Blow ‘em off. Let them say what they like.
They will use their power ties and Harvard credentials to attempt to influence government policy wherever they can, for their own benefit, and no one else’s. Any “policy makers” who are “making policy” based on anything S&P says, may believe they are looking at a light at the end of the tunnel.
Unfortunately, the light will be issuing from their proctologist’s inspection lamp because they must have their heads somewhere they shouldn’t otta be.