Politicians, analysts react to AAA rating
U.S. Treasury Secretary Timothy Geithner said today that there is “no risk” the United States will lose its AAA credit rating, saying political prospects for long-term deficit reduction are improving, Reuters reported.
Geithner made the comments to Fox Business Network, CNBC and Bloomberg Television as part of a morning blitz of the three major business networks to voice disagreement with Standard & Poor’s decision to lower the U.S. long-term credit rating to negative from stable. He emphasized that Washington is serious about putting in place mechanisms to bring down deficits.
Geithner said he believes it is possible for the Obama administration to secure a deal with Democrats and Republicans in Congress to reach a deal to “lock in” targets and mechanisms to cut deficits by $4 trillion in the next 10 to 12 years, though these will have to include discussions about programs such as Social Security and Medicare.
Some experts, though, don’t see it that way.
“It drives home the fact that for all the talk in Washington, there is nothing on the table that is moving,” said Sean West, a fiscal policy analyst for investors at the Eurasia Group, referring to the S&P announcement.
President Barack Obama, meanwhile, is beginning a tour promoting his proposal to cut the deficit. He is scheduled to hold town-hall meetings in Virginia, California and Nevada this week.