U.S. Sen. Richard Blumenthal said he takes seriously every rating about the country’s fiscal situation.
But, the junior senator from Connecticut said in an interview Monday Standard & Poor’s downgrade rating of the U.S. Treasury bonds from an AAA status to an AA+ status has more to do with the “credibility” of the credit rating agency. This, he added, is the same agency gave great ratings to the same bonds before the economic meltdown in 2008.
“The downgrade of U.S. Treasury bonds by one of the rating agencies, S&P, certainly undermines and adds greater doubt about the credibility and integrity of that rating agency, and maybe some of the others,” Blumenthal said following a visit to Naugatuck Valley Community College, “Who participated, by the way in, overrating (and) giving triple AAAs to the bonds that were backed by mortgages that became worthless."
Since the credit rating downgrade on Friday the Stock Market saw declines in the Nasdaq and Dow Jones, according to reports from the New York Times and Wall Street Journal. According to the Huffington Post, S&P has also began downgrading ratings for agencies that are linked to the federal government, such as Fannie Mae and Freddie Mac.
Blumenthal, who was elected to serve in the U.S. Senate this year, once sued S&P when he was attorney general. According to a press release, the former attorney general said both “Moody’s (another credit rating agency) and S&P’s alleged misconduct enabled the worst economic downturn in the nation since The Great Depression.”
The backlash from Friday’s credit downgrade is also being dealt out in the political arena. News agencies reported Monday the back-and-forth banter on the issue between Democratic and Republican lawmakers, as well as the administration of President Barack Obama.
Both sides of the political aisle have blamed each other. Some Republicans, such as Arizona Senator John McCain, who was quoted on Foxnews.com as saying, “I agree that there is dysfunction in our system, and a lot of it has to do with the failure of the president of the United States to lead.”
Meanwhile, members of the Obama administration, such as Treasury Secretary Timothy Geithner, was quoted in an Associated Press article as saying, "They've (S&P) handled themselves very poorly. And they've shown a stunning lack of knowledge about the basic U.S. fiscal budget math.”
Saying he has been “appalled” by the gridlock in the political arena in Washington, Blumenthal then said, “We do need to do more about our debt and our deficit, the size of government and spending needs to be reigned in and reduced.”
“We face a difficult fiscal problem in this country and we need to address it and do it by reducing spending and increasing revenue it has to be balanced approach,” he said. “And I am hopeful that the country will come together and most importantly Congress will put aside some of the partisan differences.”