The credit ratings agencies are again angering governments, but this time they are taking on the big fish of the world economy.
From Washington to Brussels, Moody's, Standard & Poor's and Fitch have added to the intense pressure on governments trying to deal with crushing sovereign debt.
Their warnings about the precarious finances of the world's top economies have also roiled investors more accustomed to seeing emerging market countries take the brunt of criticism.
Tension hit new highs on both sides of the Atlantic last week as Moody's and Standard & Poor's threatened to downgrade the United States' prized triple-A rating.
A few days earlier, Moody's slashed ratings in Ireland and Portugal to junk status, triggering an outcry from European officials.
These opinions, they continue to give them in such a way that it worsens the crisis, Ewald Nowotny, a member of the European Central governing council, said on Tuesday, referring to the agencies. He said markets could live without them.
Now that the agencies are focusing their fire on the rich world, U.S. and European officials -- long proponents of seeing indebted nations take their medicine -- are crying foul.
Their complaints carry a strong sense of deja-vu.
In 1998, when Moody's pushed Brazil deeper into junk rating territory, the country's finance ministry called the decision a mistake that showed the agency needed to invest more in sovereign risk analysis.
In a sign of the turnaround of the fortunes of many emerging economies, 11 years later in its New York headquarters Moody's received a much friendlier Brazilian finance minister, Guido Mantega, to hand him Brazil's much-awaited investment-grade status.
The question now is whether the agencies will be able to withstand much stronger political pressures while the debt crisis rages in developed countries.
In Europe and the United States, policymakers have already promised tougher regulations for the agencies after they failed to spot the housing bubble in the middle of the last decade. and stand accused of contributing to it by giving generous ratings to subprime mortgage bonds.
Rating agencies came under fire from holders of subprime-related securities because raters are paid by the firms issuing the securities. Investors argued that kind of economic incentive blurred the analysis.
Sovereign nations, by contrast, do not shell out any money for their ratings.
That has not lessened the political anger. On Wednesday, U.S. Congressman Dennis Kucinich said: No nation, agency or organization has the authority to dictate terms to the United States government. Moody's and its compatriot S&P were a direct cause of the near collapse of the economy of the United States.
EUROPEAN RATING AGENCY
In Europe, where the agencies poured cold water on a plan for Greece to extend debt maturities and avoid a default, sentiment is even worse. European Commission President Jose Manuel Barroso accused them of having an anti-European bias.
Barroso and other policymakers want the creation of an European rating agency which, they argue, would be better equipped to analyze euro zone issues. That argument overlooks the fact that Fitch is majority-owned by a French company.
The intensity of Europe's reaction to the latest sovereign downgrades is proportional to the power that ratings agencies retain over financial markets -- a clout that even the ratings agencies suggest is exaggerated.
In a recent special report about proposed regulation changes, Moody's said the agencies should not be seen as gatekeepers in the financial markets and their ratings should not be used as substitutes for disclosure by issuers.
Some say policy makers may have a point when they criticize the timing of the downgrades by ratings agencies.
Their failure to anticipate the severe deterioration of sovereign credit was an issue in emerging market debt crises in the past, said Claudio Loser, a former Western hemisphere director for the International Monetary Fund.
My experience with the rating agencies in Latin America during the debt crisis of the 1980s and 1990s is that they were a destabilizing factor, said Loser, now president of the Centennial Latin America consulting firm.
They did not warn the markets when they should have and they did actually create more noise when it was not the appropriate thing to do.
Loser believes policymakers will force the agencies to adjust significantly, and that they will emerge stronger from this crisis.
(Reporting by Walter Brandimarte; Editing by David Gaffen, Jennifer Ablan and Maureen Bavdek)