The United States has lost its sterling credit rating from Standard & Poor's. The credit rating agency lowered the nation's AAA rating for the first time since granting it in 1917. The humbling downgrade of the world's economic superpower came late on Friday night, after news surfaced of a furious rearguard attempt by the White House to convince S&P that its figures were faulty.
Shame on you Congress...enjoy your five week vacation while the country is in the middle of one of its greatest fiscal and legislative difficulties.
The downgrade came less than a week after a gridlocked Congress finally agreed to spending cuts that would reduce the debt by more than $2 trillion — a tumultuous process that contributed to convulsions in financial markets. The promised cuts without revenue increases were not enough to satisfy S&P.
S&P's statement was blunt in its assessment.
"We lowered our long-term rating on the U.S. because we believe that the prolonged controversy over raising the statutory debt ceiling and the related fiscal policy debate indicate that further near-term progress containing the growth in public spending, especially on entitlements, or on reaching an agreement on raising revenues is less likely than we previously assumed and will remain a contentious and fitful process," the ratings firm said.
S&P said it was now "pessimistic about the capacity of Congress and the administration to be able to leverage their agreement this week into a broader fiscal consolidation plan that stabilizes the government's debt dynamics anytime soon."
"We have taken the ratings off CreditWatch because the Aug. 2 passage of the Budget Control Act Amendment of 2011 has removed any perceived immediate threat of payment default posed by delays to raising the government’s debt ceiling. In addition, we believe that the act provides sufficient clarity to allow us to evaluate the likely course of U.S. fiscal policy for the next few years."
Moody's said it was keeping its AAA rating on the nation's debt, but that it might still lower it.
Speaker John Boehner issued a statement saying that the downgrade is "the latest consequence of overspending by Washington." I didn't expect him to say anything different. Wonder does he ever think of how long he has been a part of the workings in Washington? Now and then, he does little to make positive change.
Senate Democratic Leader Harry Reid said the credit downgrade showed the need for a "balanced approach to deficit reduction that combines spending cuts with revenue-raising measures." I believe that any reasonable citizen would agree with combining spending cuts with raising revenue.
"We have taken the ratings off CreditWatch because the Aug. 2 passage of the Budget Control Act Amendment of 2011 has removed any perceived immediate threat of payment default posed by delays to raising the government’s debt ceiling. In addition, we believe that the act provides sufficient clarity to allow us to evaluate the likely course of U.S. fiscal policy for the next few years."
Moody's said it was keeping its AAA rating on the nation's debt, but that it might still lower it.
Speaker John Boehner issued a statement saying that the downgrade is "the latest consequence of overspending by Washington." I didn't expect him to say anything different. Wonder does he ever think of how long he has been a part of the workings in Washington? Now and then, he does little to make positive change.
Senate Democratic Leader Harry Reid said the credit downgrade showed the need for a "balanced approach to deficit reduction that combines spending cuts with revenue-raising measures." I believe that any reasonable citizen would agree with combining spending cuts with raising revenue.
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