S & P downgrade could bring higher interest rate to SE Missouri

CAPE GIRARDEAU, MO (KRCU) - Southeast Missouri State University economist Bruce Domazlicky thinks Standard & Poor’s downgrade of the U.S. debt may lead to higher interest rate in order to attract investors.

Domazlicky says this could reverberate to the southeast Missouri economy.

"Anybody who wants to borrow money for buying houses or cars or businesses or agriculture, it’s going to cost them more," Domazlicky said. "That would probably be the main effect locally. The question is when that might occur or how much it is going to occur. We just don’t know right now. But that is a possibility."

Domazlicky adds college students will also feel the affect of the downgrade by increased interest rates on student loans.

Jacob McCleland, KRCU

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McCaskill and Blunt on federal debt

Missouri Democratic Senator Claire McCaskill is heralding compromise as the solution to the nation’s debt crises.

Senator McCaskill, feels that too many in Congress are attempting to fix the problem with only one method.

She also says that more politicians need to focus more on their work and less on elections and appeasing the “far ends of the political spectrum.”

“There is a very important goal that we are working towards and it is called compromise. I think that way too many people are focused on elections and not focused on solving the problems,” McCaskill said.

Senator McCaskill also stressed the importance of reducing tax breaks allotted to wealthy companies and individuals as part of the solution for the nation’s financial woes.

On the other side of the aisle, Senator Roy Blunt feels that the focus needs to be less upon cooperation and more upon reducing government expenditure.

He believes that the citizens as a whole are paying as much tax as they are willing to and that it is up to the government to cut spending and meet them halfway.

Senator Blunt also says that he is not only opposed to raising tax rates, but that raising rates would not increase funds for the government.

“And I think that the best way to create revenue is to create more tax payers. We ought to be talking about how we can create more private sector jobs, how we can establish and create an environment. Where private sector job creators want to create more tax payers, that’s how you raise revenue,” Blunt said.

Both senators will be members of a senatorial group meeting later this week that will look into and possibly make changes to the current plan of action for dealing with the waters of the Missouri River.

McCaskill says hopefully the states will be able to agree on a policy that makes flood control the Army Corps of Engineers’ main priority.

“It’s not navigation, it’s not irrigation, it’s not wildlife habitation. It is in fact flood control. And we’ve got to make sure that that becomes crystal clear after the difficulties that everyone has faced this year,” McCaskill said.

Historic rainfall and high levels of snowmelt have forced the Army Corps to release record levels of water down the Missouri River causing heavy flooding.

Hydrologists expect the river to remain at flood stage until at least August.

Tim Filla, KRCU and Julie Bierach, St. Louis Public Radio

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