Well, they finally did it. Standard & Poor’s announced Friday that the United States had lost its solid-gold AAA credit rating. In what must surely have been the most widely telegraphed action in the history of credit analysis, the agency made good on its threat to mark down the grade it assigns to U.S. Treasury paper if the debt ceiling squabble did not yield at least $4 trillion in debt reduction over 10 years.
The other two large rating firms (Moody’s and Fitch) retained their equivalent of AAA, but kept a negative outlook.
The official response from most of Washington: Shoot the messenger.
In one of the few truly bipartisan actions of late, members of both parties expressed their pique at S&P for having the unmitigated nerve to follow its own criteria to an inevitable conclusion. Several representatives decried the downgrade as a political stunt, inasmuch as S&P cited the unseemly brinksmanship and unsettling dysfunction on display during the debt ceiling debate as a contributing factor.
Recriminations notwithstanding, no other country could retain its top notch rating after displaying a willingness to risk default and finally adopting a sloppily cobbled patch at the eleventh hour.