Life on the downgrade — what it means to you and me

We should have seen the Standard & Poor’s downgrade of the U.S. credit rating coming –– last year. On July 13, 2010, Dagong International, a Chinese credit rating agency, lowered the U.S.’s rating from AAA to AA. Few in the West noticed. Some laughed. Clearly, though, Dagong’s calculators saw what we could not –– that the U.S. was headed for a financial train wreck.

This time, though, it was caused not by Wall Street’s avarice, but by political brinkmanship that will cost Americans a bundle in higher interest charges. For the first time in history this year, the House of Representatives –– led by the ultra-conservative Tea Party caucus –– tied raising the debt ceiling, an almost annual ritual, to deficit and debt reduction. The Tea Party, which may not control the Republican Party but certainly controls the House, refused to increase the ceiling unless the U.S. slashed spending without raising taxes, which nearly caused the federal government to default on its financial obligations for the first time on Aug. 2.

Standard & Poor’s said that was a no-no. If Washingtonians want to play games with the U.S.’s balance sheet, then the American people will pay a very dear price.

Standard & Poor’s said the U.S. must get its financial –– and political –– house in order or risk another downgrade. The rating agency advocated a balanced approach toward deficit and debt reduction –– spending cuts and higher revenues. Hmmm. Sounds much like the direction in which President Obama wanted to take us. But these days, Washington is led not by reason, but irrationality.

Worry not. We’re leaving the elite pack of financially sound nations that enjoy AAA credit ratings from Standard & Poor’s –– Austria, Australia, Canada, Denmark, Finland, France, Germany, Hong Kong, Liechtenstein, the Netherlands, Singapore, Sweden, Switzerland and the United Kingdom. But we’re in good company on the AA+ list with Belgium and New Zealand. Perhaps Hollywood could produce a reality TV series –– “The U.S. of A.: My Life on the AA+ List.” That might bring in big bucks to help reduce our deficit and debt.

And, hey, Spain’s on the AA list, and Italy, A+. And get this: China and Japan are both on the AA- list. So there.

Perhaps the downgrade will be our wakeup call. We must change our profligate ways. We must stop going to war, and we must focus on education.

In truth, our placement on an international credit rating list doesn’t worry me as much as our ranking on the Trends in International Mathematics and Science Study, which every four years measures fourth- and eight-graders’ achievement in these vital subjects. For nearly a decade since the study began in 1995, U.S. children placed low on the list –– as low as 24th among eighth-graders in the study’s inaugural year.

But in 2007, something miraculous happened. The U.S.’s scores shot up. Suddenly American eighth-graders ranked 11th on the list –– ninth in mathematics and 11th in science –– reflecting, I believe, a growing commitment to education spending.

These days, however, all we hear is that we must cut, cut, cut because our schools cost too much. That isn’t good. Public education is the bedrock on which our nation rests.

Governor Cuomo and the State Legislature enacted a 2 percent property-tax levy cap this spring that will hamstring school districts by limiting spending. Without greater state aid –– which is unlikely to materialize –– many, if not most, districts will be forced to lay off teachers in order to reduce expenditures. To get around the cap, 60 percent of a district’s voters must approve higher spending.

Wealthier districts should have little trouble overriding the cap. In May, the Jericho School District passed its 2011-12 budget, which included a 2.79 percent spending increase, with 73 percent of the vote. Meanwhile, middle class and poor districts, which already struggle to pass their budgets with 50 percent of the vote, will likely be forced to slash spending in the coming years, and the education gap between rich and poor in our public schools will only grow wider.

As part of the debt-reduction deal, the federal government plans to cut $2.5 trillion in discretionary spending, including for education, over the next decade. Reductions in the federal education budget disproportionately punish the poor. Am I seeing a pattern here?

As a percentage of gross domestic product, 36 nations spend more on education than the U.S., which expends 5.4 percent of GDP, in line with Ghana. If we spent the way Norway and Sweden do, we would devote 6.5 percent of our GDP to education, which would add $80 billion annually to our federal education budget.

The U.S. spends $200 billion a year fighting the wars in Afghanistan and Iraq –– $20 billion on air-conditioning alone. In lean times such as these, we must cut, but before doing so, we must get our priorities straight. Education should be at the top of the list.

Scott Brinton is senior editor of the Bellmore and Merrick Heralds and an adjunct professor at the Hofstra University Graduate Journalism Program. Comment below or write SBrinton@liherald.com or (516) 569-4000 ext. 203. Brinton’s profile and posts can be found at facebook.com/scottabrinton.