White House blames Republicans, ‘strongly disagrees’ with US credit downgrade.
The White House Disagrees with Credit Downgrade, Blames Republicans
Press secretary Karine Jean-Pierre released a statement shortly after news broke that Fitch Ratings downgraded the U.S. credit rating. The announcement follows a series of partisan debt standoffs on Capitol Hill.
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“We strongly disagree with this decision,” Jean-Pierre said. “The ratings model used by Fitch declined under President Trump and then improved under President Biden, and it defies reality to downgrade the United States at a moment when President Biden has delivered the strongest recovery of any major economy in the world.”
Despite disagreeing with the agency’s decision, the White House also pointed fingers at the GOP.
“It’s clear that extremism by Republican officials — from cheerleading default, to undermining governance and democracy, to seeking to extend deficit-busting tax giveaways for the wealthy and corporations — is a continued threat to our economy,” Jean-Pierre added.
Fitch announced Tuesday evening that the United States’s “AAA” rating, the highest possible, would be downgraded to “AA+” following this past year’s debt limit showdown, even though a hike was authorized by Congress and President Joe Biden before the July deadline.
A similar spending showdown is expected to take place in September.
“There has been a steady deterioration in standards of governance over the last 20 years, including on fiscal and debt matters, notwithstanding the June bipartisan agreement to suspend the debt limit until January 2025,” Fitch wrote in a statement.
Treasury Secretary Janet Yellen also said she strongly disagreed with the decision, calling it arbitrary and based on outdated data and listing improvements the Biden administration has made toward economic stability.
But the nonpartisan Committee for a Responsible Federal Budget was less forgiving of both sides in the debt ceiling showdown.
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“Today’s downgrade should be a wake-up call — we need to get our country’s fiscal and political house in order,” CRFB president Maya MacGuineas said. “The United States economy remains strong, but we are on an unsustainable trajectory.”
CRFB pointed to a high and rising national debt, increasing interest costs, and coming too close to default during the debt limit debate as reasons for the downgrade.
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