Moody's warns of US losing high credit rating in 10 years due to rises in Medicare, Medicaid and Social Security spending

[w¡n9Nµ7 §£@¥€r 123]

The US is at risk of losing its top-notch triple-A credit rating within a decade unless it takes radical action to curb soaring healthcare and social security spending, Moody's, the credit rating agency, said yesterday.

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In its annual report on the US, Moody's signalled increased concern that rapid rises in Medicare and Medicaid - the government-funded healthcare programmes for the old and the poor - would "cause major fiscal pressures" in years to come.

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"The combination of the medical programmes and social security is the most important threat to the triple-A rating over the long term," it said.

Steven Hess, Moody's lead analyst for the US, told the Financial Times that in order to protect the country's top rating, future administrations would have to rein in healthcare and social security costs.

"If no policy changes are made, in 10 years from now we would have to look very seriously at whether the US is still a triple-A credit," he said.

Mr Hess said any downgrade in the US rating would have serious consequences for the global economy. "The US rating is the anchor of the world's financial system. If you have a downgrade, you have a problem," he said.

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Most presidential candidates have vowed to reform the healthcare system but many of them, especially on the Democratic side, have focused on extending coverage to the 40m-plus uninsured Americans rather than on cutting costs

http://www.ft.com/cms/s/0/fcc631cc-bfe6-11...?nclick_check=1

[Alex+R 0]

Hm. Analysis with a pretty clear agenda...

[w¡n9Nµ7 §£@¥€r 123]

Hm. Analysis with a pretty clear agenda...

So do you think we can keep borrowing to sustain the lifestyle we have in this country if the credit ratings agencies reduce our credit rating?

There may be a clear agenda here, but the agenda is from an organization with clear control over our economic destiny. That alone separates Moody's from some random Washington think tank.

If Moody's downgrades us, the other agencies will quickly follow. And then our (as a nation) profligate lifestyle, based primarily on debt, comes crashing down.

[Alex+R 0]

I think we might have some serious problems, but equating more health care spending with ruining our credit rating seems too simplistic. I don't know enough to have a more detailed opinion.

[almaty 19]

I think we might have some serious problems, but equating more health care spending with ruining our credit rating seems too simplistic. I don't know enough to have a more detailed opinion.

i agree..maybe, they should look at the cost of that clusterfuck iraq

[w¡n9Nµ7 §£@¥€r 123]

Credit ratings are most impacted by budgetary fixed costs. Iraq isn't a fixed cost, it's discretionary.

[almaty 19]

Credit ratings are most impacted by budgetary fixed costs. Iraq isn't a fixed cost, it's discretionary.

[SMOKE 1,426]

why doesn't the gov't do something about the ridiculous prices the medical industry is charging in the US? from meds to dr. office visits to hospitol stays. they are way over charging for everything. ya ya i know r&d and knowledge & education cost but cmon. have you seen these medical administration offices? the incomes of the drug company executives & hospital executives? a lot of people like to blame insurance companies for the cost of health coverage its the health care industy that are allowed to rip you a new one when you are in need of health care (pay it or do w/o). it doesn't cost this much in any other developed nation. why are they allowed to keep dipping into our pockets deeper & deeper everyday w/o answering to anyone?

[w¡n9Nµ7 §£@¥€r 123]

why doesn't the gov't do something about the ridiculous prices the medical industry is charging in the US?

You hit the nail on the head.

[Alex+R 0]

The doctor's office messed up the claim to the insurance company, so we got the bill for a sleep study Rey was in and it was like 1500 dollars. And he could have been diagnosed without the study. Amazing. I think it's because his doctor is on the board of the sleep clinic he went to.