Five Governance Problems That Contributed to the U.S. Credit Rating Downgrade

The recent decision by Standard & Poor’s to downgrade its credit rating of U.S. government debt from AAA to AA+ resulted not from lack of money, but poor governance performance by federal officials. A number of long-term trends have paralyzed policymakers and made it difficult to address pressing problems. Unless these conditions improve, it will be difficult for elected leaders to address the budget deficit.

Super-Majority Requirements in the U.S. Senate: The dramatic increase in real or threatened filibusters in the U.S. Senate has moved American democracy from majority to super-majority rule. In order to move forward with important legislation or presidential appointments, it takes at least 60 of the 100 senators to reach agreement. This is virtually impossible to achieve in a situation where there is a vast philosophic gulf between Republicans and Democrats. Super-majority politics empower ideological extremists and lead to stalemated policy and inaction. Democracies cannot function effectively under rules where individual senators can stop action and prevent members from voting on important legislation, and it takes a 60 percent vote to stop filibusters.

Extreme Politics in the U.S. House of Representatives: American democracy is based on bargaining and compromise. When political leaders have fundamentally different visions regarding the role of government, they must negotiate their differences if there is to be any significant legislation. The emergence in the House of Republican conservatives unwilling to consider tax increases on the wealthy or closing of corporate loopholes and Democratic liberals who won’t touch entitlement programs prevents leaders from taking action to reduce the deficit in meaningful ways. The American public has expressed its support for sacrifice on the part of all Americans to close the budget deficit and is open to a range of policy proposals. But House extremists block action and keep Congress from taking reasonable steps to address the deficit and debt.

Excessive Political Polarization Across the Country: The United States has the most polarized politics that we have seen in a number of decades. Republicans and Democrats are suspicious of one another and have radically different views about major policy decisions. They get news from media outlets that play to political extremes and develop their own sets of facts. In this situation, it is impossible to develop a shared understanding of policy problems or possible remedies. Overheated rhetoric stops action and turns compromise into a dirty word.

Partisan Redistricting in American Elections: The rise of extremist politics arises from legislative redistricting that creates homogenous districts which are not politically competitive. State legislatures across the country have created safe districts where it is virtually impossible to beat incumbents short of personal scandal. This frees legislators from voter accountability and allows them to take extreme views without fear of electoral reprisal. More competitive districts would reduce political extremism and improve electoral accountability.

Low Voter Turnout Encourages Political Leaders to Play to the Base: Only around 40 percent of eligible Americans vote in congressional elections and 60 percent vote in presidential races. These low turnout rates create incentives for Republicans to play to conservatives and Democrats to focus on liberals. Those are the individuals who vote in each party’s primaries so rather than playing to the middle, members of Congress tell their base what they want to hear. This weakens the center of the political landscape and complicates the task of addressing major policy problems.