According to the credit rating agency Standard & Poor’s, the Obama Department of Justice will be suing it over their mortgage bond rating practices in the run-up to the 2008 financial collapse. As the news of the lawsuit broke, stock in McGraw-Hill Cos dropped 13.8 percent, the worst fallout since the 1987 stock market plunge. Moody’s, another major credit agency, also took a massive hit in expectation that the DOJ will be coming after them as well.
S&P says that the lawsuit is unwarranted, “entirely without factual or legal merit … The DOJ would be wrong in contending that S&P ratings were motivated by commercial considerations and not issued in good faith.” The DOJ did not issue any statement.
It is unclear why S&P has been singled out first and foremost. But back in August 2011, S&P kicked the US’ credit rating down to AA+ from AAA status, explaining, “America’s governance and policymaking becoming less stable, less effective, and less predictable.” At the time, Gene Sperling of the White House Council of Economic Advisors blasted the S&P call. Austin Goolsbee, then the Obama chief economic advisor, stated that S&P was “making a political judgment and it is one that we don’t agree with.”
The timing of this lawsuit is odd, and smacks of retaliation. It has been over five years since 2007, when the offenses are alleged to have occurred. It couldn’t be any coincidence that President Obama waited until after his re-election to sic the DOJ on his political enemies, could it?
Ben Shapiro is Editor-At-Large of Breitbart News and author of the book “Bullies: How the Left’s Culture of Fear and Intimidation Silences America” (Threshold Editions, January 8, 2013).