you ve got two other ratings agencies, they re still giving the united states the aaa rating. how can standard & poor s have this great an effect on this country and those who invest in it? reporter: because it s cascading down. you start with the downgrade on friday afternoon of american treasury securities. uncle sam itself. today come down a notch, and you have downgraded what s called agency debt, fannie and freddie, housing agency debt. they ve been downgraded. that s a cascade coming down the food chain. is the next step going to be towns and cities across america? could we see bankruptcies emerge because of that original downgraded treasury debt? that s the concern, that it ripples throughout the debt market, takes a lot of people down with it, slows the economy, makes the debt even worse. that s how it effects you and i. megyn: you know, stu, we ve been seeing a lot of kill the messenger in the wake of this announcement by standard & poor s, and a lot of criticism
mcconnell, he was saying the only way to get to four trillion was to include revenues and tax hikes. these agencies are neither republican nor democrat. they do not care. they just want to see tate adds up to four trillion. they don t so they don t make political statements as to whether the complexion of the deal is hear me out. they are saying if it wasn t going to be four trillion, regardless of the mix, they wouldn t like it. they didn t like it. this is what they did. greta: can we stop putting them up on the alter. let s take about these ratings agencies they are the reason the credit swaps got the aaa ratings [ talking over each other ] please i frankly don t care who is to blame. when it comes to washington pointing fingers it too missed a lot. i m not making excuses for the ratings agencies.
what he said, in that writing about then minutes from now. in the meantime answer are your decide question at foxnews.com. we are asking what federal fiscal issue most concerns you? is it the debt, taxes? is it a downgrade by the ratings agencies for u.s. debtor is it the big question of default and whether or not it would indeed have to happen? weigh in, you can see what other folks are saying there, we ll check back in on that survey in a little while. let s go for a moment to the state of alabama where educators are raising concerns about the state s new immigration law. the people who run the school district are complaining that following that law may put them at risk of losing federal funding. jonathan serrie has that story live from atlanta. reporter: sponsors of the new law say it s going to give alabama taxpayers an accurate assessment of just how much they pay each year to support public
basically you look at recent history, enron, worldcom. mortgage-backed securities during the financial crisis, lehman brothers, these were all highly rated instruments by the ratings agencies. until the moment when investors realized they were wrong. they were highly rated until they weren t. exactly. so what we have to worry about, i think as mary said, what investors think and are they satisfied that the u.s. is going to pay its debts and it s still the greatest credit in the world and a judgment much bigger and important than the ratings agency said. this is a structural problem, it s not something you paper over. that s how we like greece. we re not like greece yet and as kim said this is going to take time. the question the markets will be looking at. is there any capacity for the political system to face the structural problem? and i think that will depend a lot how this is handled politically by the republicans.
doesn t mean the ratings agencies still won t downgrade the united states because they ve threatened to do it, and the spending cuts they re talking about in these deals are not substantial enough to bypass such a rating downgrade. so we could get one anyway. jenna: not fun seems to sum it up, neil, using your phrase on that. obviously, we re talking about a major domestic issue with, also, equally major international ramifications. and this just came out from china s state news agency today, yesterday i should say. they issued this commentary on what s happening in washington, and china, of course, is a major owner of our debt. so this is what they had to say, neil. political brinkmanship in washington is dangerously irresponsible. the ugliest part of the saga is that the well being of many other countries is also in the impact zone when the donkey and the elephant fight. the potential collateral damage is way too heavy. what are your thoughts on that? reporter: well, leaving aside