Congresswoman Maxine Waters (D-Calif.), ranking member of the House Financial Services Committee, blamed “the radical and unjustifiable actions of extreme MAGA Republicans” for Fitch Ratings’ decision to downgrade the United States’ long-term foreign currency issuer default rating (IDR) to AA+ from AAA.
In a statement, Fitch Ratings said its downgrade of the U.S. long-term foreign currency IDR “reflects the expected fiscal deterioration over the next three years, a high and growing general government debt burden, and the erosion of governance relative to ‘AA’ and ‘AAA’ rated peers over the last two decades that has manifested in repeated debt limit standoffs and last-minute resolutions.”
“Let’s be clear: the radical and unjustifiable actions of extreme MAGA Republicans are creating the excuses for market participants, including Fitch, to question the resiliency and recovery of the U.S. economy,” Waters said in a statement. “Under their extremist agenda in the House, Republicans not only engaged in a months-long brinkmanship over our nation’s debt, but on many occasions, encouraged what would’ve been a catastrophic debt default. Earlier this year, I warned my Republican colleagues several times that just the mere threat of a default, on its own, could lead to market volatility and a credit rating downgrade.”
Fitch said there’s 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. The repeated debt-limit political standoffs and last-minute resolutions have eroded confidence in fiscal management.”
Waters said she believed actions under former President Donald Trump contributed to the downgrade.
“Trump and extreme MAGA Republican efforts to incite a riot and undermine our nation’s democracy on Jan. 6, according to Fitch, also represent a clear deterioration in governance,” she said. “We must call this what it is: a Trump downgrade. This decision makes clearer than ever that extreme MAGA Republicans in Congress are a danger to the growth and stability of our nation’s economy, and we must do everything in our power to thwart their extremism before it’s too late.”