Standard and Poor’s, like the other major ratings agencies, Fitch and Moody’s, assesses federal finances in order to rate how secure investors can feel when they invest in United States debt. But it simultaneously lobbies the federal government in order to protect its unique role in the financial world.
That puts the ratings agency in an “unusual political position,” according to a Washington Post report:
“S&P wields a huge club over Congress and the president because the company can simply dictate public policies that have huge ramifications for the country and for the government,” said Craig Holman of the Public Citizen advocacy group. “Its influence over the government’s purse can easily be employed as a powerful tool to win concessions from the federal government that are in S&P’s own interest rather than the public’s interest.”
The purpose of the lobbying campaigns by S&P and the other agencies is essentially to minimize government oversight of their operations. For example, they have fought against a section in the Dodd-Frank financial reform bill that removed restrictions against people suing the agencies for negligence, the Post reports.
Together, the three agencies have spent $16 million on lobbying the past decade.
Representatives of all three ratings agencies said they maintain a strict separation between their analytical and lobbying teams.
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