Photo: Yellen-He meeting July 2023, public domain
Fitch Ratings has been a highly respected institution for more than a century, as one of the so-called Big Three credit agencies. It issued a warning earlier this year about possibly downgrading our federal credit score. Many assumed that the bipartisan deal in June to suspend the debt ceiling until 2025 had allayed concerns. However, Fitch followed through on their warned course of action by officially downgrading our federal credit score for only the second time in our nation’s history.
This downgrading stunned the Biden White House, which howled in response. Treasury Secretary Janet Yellen issued a statement calling it “arbitrary and based on outdated data.” Yet, it is hard to ignore the clear warning signs that guided Fitch’s decision. One obvious cause for concern is our ever-increasing debt-to-GDP ratio. Spending is going up, and an economy plagued with Bidenomics simply isn’t robust enough to grow with the volume of debt. Another big cause for concern is increased mandatory spending on such programs as Medicare and Social Security. Let’s also not forget the general climate of economic instability that Biden is promoting. Fitch predicted a coming recession by the close of the year and other problems like high interest rates.
This downgrading of our national credit rating is yet another demonstration of Joe Biden following in Barack Obama’s footsteps in all the wrong ways. It was Obama who ushered in the very first downgrading of our national credit in 2011 by Standard & Poor. Fitch’s downgrade is our second, but it may not be our last if our nation continues on its current trajectory. “Fiscal responsibility” and “federal government” are two phrases that have never seemed to go together, but the historic nature of our nation’s problem with money can’t just be brushed off. We need to embrace old-school conservative principles of lower spending, lower regulation, and higher transparency. The engine of the American economy can roar to life once again, but we’ll need courageous grassroots patriots and strong leadership to make it happen.