It was alarming -- though sadly understandable -- when credit-rating agency Standard & Poor's recently downgraded the United States' rating from the top level, AAA, to AA-plus -- for the first time in U.S. history.
S&P and other rating agencies had warned of the possibility of a downgrade because of Washington's failure to start getting our nation's massive deficits under control. But those warnings were practically ignored, and the lower rating was a result of that inaction.
Reduced credit ratings can force up interest rates for businesses and consumers, lowering economic activity. And they can force the United States to pay even more interest on our catastrophic $14.8 trillion national debt.
That has a negative effect on all Americans.
But the downgrade of our country's credit rating also threatened Tennesseans in particular. Because about 40 percent of Tennessee's budget is linked to the federal government, it was strongly feared that Tennessee's own debt would be downgraded by the rating agencies, too.
Fortunately, however, state officials made a strong case to the three major agencies in September for why Tennessee should keep its high ratings -- including clear plans for how Tennessee would manage any cuts in federal funding to the state.
The presentations by Gov. Bill Haslam and other state officials evidently convinced the rating agencies that Tennessee is serious about being fiscally responsible.
Thus, the agencies did not downgrade our state's credit ratings, as had been feared.
Tennessee will maintain its top-notch ratings from Moody's Investors Service and Fitch Ratings, and Tennessee's rating by Standard & Poor's will remain where it is -- just one notch below S&P's highest level.
"We are committed to fiscal restraint in managing our budget and will continue to prepare for the likelihood of less federal funding out of Washington," Haslam stated in a news release.
How we wish that Washington would follow Tennessee's lead by reducing its breakneck spending and at least beginning to move toward balanced budgets.
Under even the best circumstances and policies, our nation will not have balanced budgets, much less a total elimination of our debt, in the short term. But we will never reach those goals if we do not start to address -- much more seriously than we have so far -- the spending that created the crippling debt.
We are grateful that Tennessee's fiscal conservatism has maintained the state's high credit ratings. But it is vital for our nation as a whole to insist on greater financial responsibility as well.