For the first time in history, the U.S. credit rating was downgraded from a prized AAA status to a riskier AA+ credit rating by Standard & Poor.  S&P cited its decision in part on the political gridlock in Washington preventing a viable solution to the long term structural debt crisis faced by the federal government.

It is not clear what the consequences of this downgrade will be.  It’s unlikely this one opinion of a single credit rating agency based on facts we have already known for a long while will significantly affect markets on its own.  With much of the developing world growing and demanding low-risk investments, the U.S. Treasury bond is still in high demand which keeps our interest rates low when there are so many willing to lend us their savings.

What is clear is a panic has slowly been seeping into the psyche of the American economy.  This week alone, after an unusually controversial increase of the debt ceiling was passed, the markets reacted by plummeting nearly 700 points.

Investors have realized, just like S&P, that the political climate in Washington is dominated by a recalcitrant minority of Congressman dead set on forcing the ideological conclusions they came to freshman year of college on everyone else despite how much representative democracy may resist their version of a utopia.

The Tea Party has made its position very plain in the ears of the American people – there will be drastic cuts to government spending.  Even in our current economic climate of high unemployment and prior deep cuts to government spending worsening the jobs crisis, still there will be a no prisoner approach.

The thousands of jobs that were lost because of cuts to spending are no matter for the Tea Party.  If it increases our unemployment lines, cutting unemployment benefits is really the solution to that problem.  If children are crammed into classrooms with 60 other students, this is also no bother.  An emergency financial manager preferably appointed from the ranks of the Tea Party will be there right away to remedy that by selling off the school football field as a new golf course for the state’s elite to spend their latest tax cut.

And if the U.S. government is set to default on its debt, the Tea Party will stand up for its principles and settle for no compromise until the rest of us bend our very morality to conform to their overzealous ideological positions.  One just hopes the cuts to our nation won’t be too visceral before leaders shout loud enough to halt this attack on American democracy.