White House Scorns S&P Downgrade

Aug 7, 2011
Originally published on August 7, 2011 9:22 am
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JOHN YDSTIE, Host:

In a moment, and we'll hear how countries overseas are reacting to the news. But joining us now is NPR national political correspondent Don Gonyea. Hi, Don.

DON GONYEA: Hey. Good morning, John.

YDSTIE: Don, there was some push-back from the White House and Department of Treasury about this decision. They said S&P's analysis was flawed and based on math errors.

GONYEA: So, Don, how does this news change the political landscape and the mood for GOP presidential candidates?

YDSTIE: Well, welcome to this week's storyline on the campaign trail. And it is a big week on the campaign trail. This is - let's call it Iowa week. On Thursday night there's a candidates debate in Des Moines. The Iowa State Fair, which is a huge event in pre-caucus years, starts on Thursday as well. And then it all builds up to Saturday's Ames straw poll, which is the first real test for the candidates.

GONYEA: There's been widespread condemnation by the Republican hopefuls of President Obama as having brought this on himself. Just here's just a sampling of reaction from Mitt Romney: Americans' credit worthiness just became the latest casualty in President Obamas failed record of leadership on the economy. Michele Bachmann says: President Obama is destroying the foundations of the U.S. economy, one beam at a time. And she calls for Treasury Secretary Timothy Geithner to step down. That's just a sampling, but a representative sampling, so this becomes the storyline of not just the next week, but the months ahead on the trail.

YDSTIE: So Don, I imagine there's a bit of a sense of foreboding in the White House ahead of the market openings around the world tonight and tomorrow?

GONYEA: They are watching things very closely. What they're doing is there trying to portray Standard & Poor's decision, the downgrade, as an outlier, noting that Moody's and the Fitch rating services haven't issued a downgrade. The White House says the lack of action by other ratings agencies does show that the collective judgment is that the U.S. is still very creditworthy.

YDSTIE: NPR's national political correspondent Don Gonyea. Thanks very much, Don.

GONYEA: Thank you. Transcript provided by NPR, Copyright NPR.