Published August 5, 2011
“You can always count on Americans to do the right thing – after they’ve tried everything else.” –
Winston Churchill

All eyes have been on the U.S. Congress … unfortunately. The world has lost confidence in our ability to manage and pass laws. As we crawfished toward a resolution of the debt ceiling crisis, we no longer looked like a country with strong leadership, but rather like a banana republic.

As David E. Sanger wrote in the New York Times on Aug. 1, “… the brush with default has added a new dimension. It has left America’s creditors and allies alike wondering what had changed in American politics that a significant part of the country’s political elite was suddenly willing to risk the nation’s reputation as the safest place for the rest of the world to invest.

“It raised questions about whether the United States now faces brinkmanship over a variety of issues
between an emboldened conservative movement and a president whose authority is under challenge,”
Sanger continued. “And for all the talk on the right about ‘American exceptionalism,’ especially among
members of the Tea Party, it put doubts in the minds of many about whether America’s military and
economic dominance is something the country is still willing to pay for – and will always survive.
“The new head of the International Monetary Fund, Christine Lagarde, seemed to give voice to that
concern when she noted on CNN that in the past there was always ‘a positive bias towards the United
States of America, towards Treasury bills.’ The events of the past few weeks, she said delicately, are
‘probably chipping into that very positive bias.’ ”

Democrats […]