Obama Slams S&P Downgrade, Believes U.S. Remains AAA Country
After a rocky week on Wall Street and a credit downgrade by S&P, President Barack Obama sought Monday to calm investors and Americans, saying he has hope in America's future. However, whether his words of comfort will have the desired affect remains to be seen, although initial reactions would indicate the response was far from what Obama was looking for, with the Dow falling more than 600 points Monday.
"On Friday, we learned that the U.S. received a downgrade... not so much because they doubted our ability to pay our debts... but because after witnessing a month of wrangling" over the debt ceiling debate, Obama said Monday, speaking from the White House about the Standard and Poor (S&P) credit agency.
Criticizing S&P's decision to downgrade the U.S. credit rating from AAA to AA plus, Obama quoted Warren Buffet, whom he said "knows a thing or two about investments," and about the S&P's misstep.
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Buffet said last week that the U.S.'s credit rating is more than worthy of a quadruple rating.
"We didn't need a rating agency to tell us that we need a long-term approach to deficit reduction," Obama continued. "We didn't need a credit rating agency to tell us that a gridlock in Washington has not been constructive."
"No matter what some agency may say, we've always been and always will be a AAA country," Obama insisted.
"We've always...had the will to act, the determination to shape our future, the willingness in our democracy to work out our differences and move forward," the president said. "Our problems are imminently solvable."
The president finalized his comments on the U.S. economy by saying that he has hope for America's future.
The live remarks from the president were streamed online by the White House on its official website and also on its Facebook page, where users were able to log on and comment as the president spoke.
In reaction to Monday's remarks by Obama, comments by Facebook users ranged from pessimism to doubt of the president's and lawmakers' ability to improve the nation's economy.
Here are some reactions:
David Craig - "You can't 'spend' your way to a better economy, if you could ask Hoover he would probably agree now"
Rich Graham - "What the president is saying is the truth. Its (sic) the republicans lies, insyults (sic) and insinuations that the american (sic) people rejected. And because that is all the party of racist retarded republicans has to offer the American (sic) people will reject it again."
Roberta Vaubel - "Congress came back on a Sunday night to vote about Terry Schaivo (sic) but NOT This? What is really important to the right wing ideologues? Religious dogma and causing other peoples pain only?"
Jerry Bucknoff - "Remember, every dollar we spend on essential services such as air traffic controllers, job creation, highways, health care, unemployment insurance, environment, education, etc., is a dollar we don't have available to pass onto the very rich in the form of tax cuts. We can't spend money we don't have. If we spend our money on stuff like jobs and clean air, then we won't have any money for big tax refunds for the rich."
On Friday, after the end of tumultuous trading week on Wall Street, Standard and Poor's (S&P) downgraded the U.S. credit standing from AAA to AA plus "with a negative outlook."
The credit rating agency also criticized Obama and Congressional leaders by saying they failed to do enough to tackle America's debt crisis. Lawmakers are tasked with reducing the federal budget in the next 10 years.
"We think elected officials across the political spectrum are unable to proactively put the U.S. on sustainable footing, as some of our most highly rated governments," John Chambers, chairman of S&P's sovereign debt committee, said in a statement last week.
The market reacted negatively to S&P's comments Monday, with the Dow showing a loss of more than 600 points at one point in mid-afternoon trading.
The S&P revealed Monday that it also plans to downgrade the credit ratings of mortgage lenders Fannie Mae and Freddie Mac, two of the nation's biggest lenders.
Wall Street experienced its worst loss since the 2008 economic crisis last Thursday, wiping out all its gains since the start of the 2011 trading session.
