Last night, during both the GOP presidential primary debate and a post-debate interview with Fox News’ Sean Hannity, Rep. Michele Bachmann (R-MN) claimed that S&P’s downgrade of the United States creditworthiness vindicated her position that the debt ceiling should not have been raised. “Standard & Poor’s essentially proved me right,” she told Hannity, after telling the debate audience that the S&P downgrade came about because the agency said “we don’t have an ability to repay our debt”:
We just heard from Standard & Poor’s, when they dropped our credit rating and what they said is we don’t have an ability to repay our debt. That’s what the final word was from them. I was proved right in my position. We should not have raised the debt ceiling.
After this performance, it’s blatantly clear that Bachmann has no idea what S&P said, because just about every word out of her mouth regarding the agency’s decision was incorrect. For starters, S&P never said “we don’t have an ability to pay our debt.” After all, the agency still rates the U.S. as AA+, meaning it has a “very strong capacity to meet financial commitments.” One S&P analyst characterized the difference between AA+ and AAA as just “degrees of excellence.”
Furthermore, the reasons that S&P issued the downgrade — as it clearly laid out in its release on the subject — were the use of the debt ceiling as a political football and GOP intransigence on taxes. As National Journal put it, “It’s hard to read the S&P analysis as anything other than a blast at Republicans.”
A Standard & Poor’s director added one more justification to the mix yesterday, saying “that one reason the United States lost its triple-A credit rating was that several lawmakers expressed skepticism about the serious consequences of a credit default”:
Without specifically mentioning Republicans, S&P senior director Joydeep Mukherji said the stability and effectiveness of American political institutions were undermined by the fact that “people in the political arena were even talking about a potential default,” Mukherji said.
“That a country even has such voices, albeit a minority, is something notable,” he added. “This kind of rhetoric is not common amongst AAA sovereigns.”