U.S. Downgrade Shows the Importance of Taking Our Fiscal Situation Seriously
Fitch Ratings downgraded the U.S. credit rating from AAA to AA+ today, citing continued erosion of governance, fiscal deterioration, and growing government debt.
The following is a statement from Maya MacGuineas, president of the Committee for a Responsible Federal Budget:
Today’s downgrade should be a wake-up call – we need to get our country’s fiscal and political house in order. The United States economy remains strong, but we are on an unsustainable trajectory.
As Fitch points out, our national debt is high, deficits are rising rapidly, interest costs are consuming an increasing share of revenue, and we have numerous major fiscal challenges on the horizon. We also came far too close to default during the last debt limit debate.
The Fiscal Responsibility Act represented an important step in the right direction, but already there are signs of backsliding. Instead, policymakers need to build on those efforts with further deficit reduction. And we must do so without putting the nation’s full faith and credit at risk. This could start with a bipartisan fiscal commission that puts all parts of the budget and tax code on the table.
Whether one agrees with Fitch’s decision to downgrade the United States government or not, we are clearly on an unsustainable fiscal path. We need to do better.
For more information, please contact Kim McIntyre, Director of Media Relations, at firstname.lastname@example.org.