LAST WEEK was not a good one for United States President Barack Obama. Not just the downgrade from triple A credit rating but more ominously the fact that several of the Taliban in Afghanistan seemed to have scored a significant victory by shooting down a special forces team helicopter, killing more than 30 military personnel.
It was quite unusual for the United States military to disclose this classified information when its military policy had gone to great lengths to keep the identity of the team secret after the operation at Abbottabad in Pakistan when Osama bin Laden was executed.
Nonetheless these developments are going to make the struggle for another four years for Mr Obama in the White House that much more difficult.
The debt is not something that Mr Obama and his team cannot handle and the rating should be revised pretty soon or simply ignored as the government pushes the debt ceiling and cuts the budget gap.
The projection that it could be as long as two years before Standard & Poor’s revise their decision may be made secondary by the government’s power and influence. Unfortunately, the record will show it was on Mr Obama’s watch that the United States lost its rating position.
Perhaps it is only fair to state that President Obama is a victim of weeks of political grandstanding between the Democrats and Republicans that led to the United States being fiscally challenged.
The global impact of the rating downgrade is also a cause of concern and dollar-pegged currencies are closely watching the American market to work out a solution of this potential problem.
It is also likely to have far-reaching repercussions, and would inadvertently impact currencies pegged to it. This development is more than enough to trigger other major economies such as Japan, China, Germany and Britain into a new phase of protectionism as they deal with the world’s pre-eminent trading partner.
On a slightly different matter, it seems that the Arab Spring has reached what’s left of the British Empire. It may be as a result of the economic situation or it may be based on race. Whatever the situation, London is on fire.
Reports of violence and looting flared across London last night and spread to a second major city as shops and cars were set ablaze and authorities struggled to contain a third night of unrest in Britain’s capital, which will host next summer’s Olympic Games.
The worst rioting in London in decades saw buildings, vehicles and garbage dumps set alight, stores burglarized and police officers pelted with bottles and fireworks, as groups of young people rampaged through neighbourhoods across the capital city.
Though somewhat early days, the so-called democracy of the mob must be nipped in the bud before it becomes cancerous.
