US loses last perfect credit rating amid rising debt

The Republicans have tried nothing and are all out of ideas.

The debt and deficit didn't just happen. The last administration is partly to blame for our credit rating going down, even after a credit rating drop in 2023 didn't curb Biden's spending; one spending bill wouldn't have prevented this. Hopefully, some of you understand the extreme measures the government is taking to cut spending.

Blame the government of both parties that worry about votes instead of doing what's right for the country, going back to 2011. The Federal Reserve also with its monetary policy.

2012
Although none of the Big Three took any downgrade action in 2012, Egan-Jones downgraded twice further. After its initial rating cut on July 16, 2011, from AAA to AA+, Egan-Jones cut its rating a second time on April 5, 2012, from AA+ to AA "because of the lack of any tangible progress on addressing the problems and the continued rise in debt to GDP."[31] On September 14, 2012, Egan-Jones cut its rating a third time from AA to AA−, the lowest of what is considered "high grade", as a reaction to QE3.[32]

On December 19, 2012, the credit agency Fitch warned that it might cut the U.S. credit rating, citing fiscal cliff[33]

2013
On October 15, 2013, the credit agency Fitch warned that it might cut the U.S. credit rating, citing the political brinkmanship over raising the federal debt ceiling.[34]

On October 17, 2013, Dagong Global Credit Rating downgraded the United States from A to A− and maintained a negative outlook on the country's credit.[35]

2014
On March 21, 2014, Fitch Ratings upgraded its outlook for the U.S. to a AAA credit rating, removing the nation from a downgrade watch after politicians put off another debt limit battle until the following year. The company, one of three major credit rating firms, changed the outlook for the rating to stable from a negative watch put in place in October.[36]

2019
In January 2019, Fitch Ratings warned that an extended 2018–19 United States federal government shutdown might lead to a downgrade in the U.S.'s Triple-A credit rating if lawmakers were unable to pass a budget or manage the debt ceiling.[37] That in turn would make borrowing more costly for companies and American households, because it is the benchmark for many other lines of credit.[37]

2020
In July 2020, Fitch Ratings reaffirmed long-term foreign currency and local current default ratings at AAA but revised the outlook from stable to negative. Fitch noted that the US benefited from issuing debt in the world's reserve currency, but highlighted that the US government had the highest debt of any AAA-rated sovereign, and there was no credible fiscal consolidation plan in light of the economic shock caused by the Coronavirus disease 2019 pandemic. They predicted government debt to exceed 130% of GDP by 2021.[38]

2023
In response to the 2023 United States debt-ceiling crisis, Fitch placed its AAA rating on a negative watch on May 24, 2023, warning that "risks have risen that the debt limit will not be raised or suspended before the x-date and consequently that the government could begin to miss payments on some of its obligations." The agency cautioned that a default would downgrade affected securities to 'D', while other treasury bills could fall to 'CCC' or 'C'.[39]

On August 1, 2023 Fitch downgraded the United States's long-term credit rating from AAA to AA+.[40] Following the downgrade, economists argued that higher interest rates will result in higher mortgage rates[41] and also assert that relying on foreign financing can have risky economic implications.[42]

2025
On May 16, 2025, Moody's downgraded the US debt rating to Aa1 from Aaa.[43]

Potential consequences to credit rating agencies
Two weeks after the August 2011 S&P downgrade, the SEC and Department of Justice announced that S&P was under investigation. Columnist Bob Sullivan of NBC News asked if "the ratings downgrade from Standard & Poor’s [could] be viewed as a shot back at a government that's been taking plenty of shots at the ratings industry lately."[44] Two years later in 2013, S&P "blasted a $5 billion fraud lawsuit by the U.S. government as retaliation for its 2011 decision to strip the country of its AAA credit rating."[45]

Two weeks after the second downgrade by Egan-Jones in April 2012 to AA, the SEC voted to bring administrative action against the firm regarding years-old activity. Mr. Egan said at the time, "We are not going to be intimidated by anybody from issuing timely, accurate ratings."[46] After Egan-Jones agreed to a settlement in 2013, the SEC director Robert Khuzami said in a press release, "EJR and Egan's misrepresentation of the firm's actual experience rating issuers of asset-backed and government securities is a serious violation that undercuts the integrity of the SEC's NRSRO registration process."[47] In response, a Fox Business Network editor raised the question of "government retaliation" and an Egan-Jones spokesman issued a non-apology apology stating that the "SEC settlement lets us focus on what we do best—producing the most accurate and independent ratings in the business."[48]

12 of 16 years we were under Democratic rule in the Executive branch - clearly shows where the fault lies.

7thKeeper said:

... Why would you point to executive when it's House and Senate that are in charge of the budget? Quit being so partisan.

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How many year was the House and Senate Democratically ruled vs Republicans?

Quit being so sensitive

Always in His Presence said:

How many year was the House and Senate Democratically ruled vs Republicans?

Quit being so sensitive

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Always in His Presence said:

View attachment 365209

12 of 16 years we were under Democratic rule in the Executive branch - clearly shows where the fault lies.

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Your graph is off and seems to have been made to be intentionally misleading, since years that the deficit grew substantially, 2008 and 2020, are times when a Republican was President. If you put the separators in the right years, it does a much better job of highlighting who was responsible for the budget issues. Particularly, with the way Congress works, once the debt as a percent of Federal Reserve rises, it is very tough to bring it back down (though Obama, and even Biden to a lesser degree, seems to have done a decent job of that).

Always in His Presence said:

View attachment 365209

12 of 16 years we were under Democratic rule in the Executive branch - clearly shows where the fault lies.

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The vertical bars are all 1 year early. In nearly all of such plots the number for the year is placed at Jan 1. So "2008" is at Jan 1 2008 (1 year before Obama took office). There is a small chance the number is located at the middle of the year (Jul 1 2008). [Plot makers: USE TICK MARKS!!!!]

The USD seems to be losing its status as the global currency reserve.
Many nations are selling off BILLIONS in US bonds - China sold off over $340 billion.
The debt keeps climbing.

$1 TRILLION a year just to service the interest!

Trump's ever changing tariffs - based on whether or not he got soap in his eyes in the shower that morning - are not helping the global economy and American trade.

His insane BBB which gives $3 TRILLION in tax cuts over the next decade to billionaires while kicking the bottom 16 MILLION Americans off healthcare is not only a breach of election promises to curb the debt, but it is economically suicidal.

The world is watching - and starting to prepare for the end of American economic hegemony.
The end of the American advantage as the global currency reserve.

This brilliant analysis shows the weird way international borrowing of US bonds has propped up the US economy.
But if confidence in the US dollar vanishes - everything changes.
Inflation kick starts, importing all those manufactured goods and a quarter of your food all becomes more expensive - and the interest rates could rise. Then you're paying even MORE to service your debt.

Annually - the US is paying MORE ON DEBT than your entire military budget!
And that is unprecedented in developed economies.

The US economy is being meddled with by a bloke who went bankrupt running casino.

eclipsenow said:

The USD seems to be losing its status as the global currency reserve.
Many nations are selling off BILLIONS in US bonds - China sold off over $340 billion.
The debt keeps climbing.

$1 TRILLION a year just to service the interest!

Trump's ever changing tariffs - based on whether or not he got soap in his eyes in the shower that morning - are not helping the global economy and American trade.

His insane BBB which gives $3 TRILLION in tax cuts over the next decade to billionaires while kicking the bottom 16 MILLION Americans off healthcare is not only a breach of election promises to curb the debt, but it is economically suicidal.

The world is watching - and starting to prepare for the end of American economic hegemony.
The end of the American advantage as the global currency reserve.

This brilliant analysis shows the weird way international borrowing of US bonds has propped up the US economy.
But if confidence in the US dollar vanishes - everything changes.
Inflation kick starts, importing all those manufactured goods and a quarter of your food all becomes more expensive - and the interest rates could rise. Then you're paying even MORE to service your debt.

Annually - the US is paying MORE ON DEBT than your entire military budget!
And that is unprecedented in developed economies.

Click to expand...

Over the past two decades, I have consistently observed that when a Republican holds the presidency, liberal economists assert that the BRICS nations are strengthening and may soon challenge the dominance of the US dollar. Conversely, when a Democrat is in office, conservative economists make similar predictions.

The US dollar will remain the dominant global currency, as no other currency currently has the capacity to replace it.

However, economic challenges arise in global trade. President Trump's policies have pushed US allies to develop new trade relationships among themselves and with former adversaries, often excluding the US. For example, Canada and Mexico are seeking closer ties with China and Europe, while Brazil has signed a decade-long agriculture and beef deal with China, previously a US market. Similarly, tariffs on India have led it to cooperate more with China, once an adversary. President Trump will leave office in 2029, but these shifting trade alliances could endure for generations.

FAITH-IN-HIM said:

Over the past two decades, I have consistently observed that when a Republican holds the presidency, liberal economists assert that the BRICS nations are strengthening and may soon challenge the dominance of the US dollar. Conversely, when a Democrat is in office, conservative economists make similar predictions.

The US dollar will remain the dominant global currency, as no other currency currently has the capacity to replace it.

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Is that so? Does there HAVE to be a dominant currency? What about the Euro?

Your debt to GDP ratio is out of control - your debt interest payments are higher than your military payments.
And Trump just added far MORE debt rather than reducing it as he promised.

FAITH-IN-HIM said:

However, economic challenges arise in global trade. President Trump's policies have pushed US allies to develop new trade relationships among themselves and with former adversaries, often excluding the US.

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Exactly.
And as they do so - this also can challenge the US dollar as the video explains.

FAITH-IN-HIM said:

For example, Canada and Mexico are seeking closer ties with China and Europe, while Brazil has signed a decade-long agriculture and beef deal with China, previously a US market. Similarly, tariffs on India have led it to cooperate more with China, once an adversary. President Trump will leave office in 2029, but these shifting trade alliances could endure for generations.

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Exactly!

Because if America elected Trump twice - who is to say what comes next? As one NYT article put it - Abraham Lincoln himself could be re-elected and the world would still think "Hmmm, trust America? Hmmm, I think not."

Not only this - Trump's attack on clean energy and climate scientists has stimulated a massive brain drain. Many scientists could soon be leaving America - as in I've heard figures like 75%. Europe and China have hundreds of millions dedicated to scooping them all up! That kind of thing also takes decades to recover from!

eclipsenow said:

Is that so? Does there HAVE to be a dominant currency? What about the Euro?

Your debt to GDP ratio is out of control - your debt interest payments are higher than your military payments.
And Trump just added far MORE debt rather than reducing it as he promised.


Exactly.
And as they do so - this also can challenge the US dollar as the video explains.


Exactly!

Because if America elected Trump twice - who is to say what comes next? As one NYT article put it - Abraham Lincoln himself could be re-elected and the world would still think "Hmmm, trust America? Hmmm, I think not."

Not only this - Trump's attack on clean energy and climate scientists has stimulated a massive brain drain. Many scientists could soon be leaving America - as in I've heard figures like 75%. Europe and China have hundreds of millions dedicated to scooping them all up! That kind of thing also takes decades to recover from!

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You are right, at present, the only currency that could potentially replace the US dollar is the Euro. However, it is unlikely that Europe will challenge the United States in this regard within the next five to ten years. Despite current political tensions, Europe remains dependent on the US for defense. Perhaps in five to seven years, as Europe revitalizes its defense industry and increases its defense spending to 5%, European nations may gradually reduce their reliance on the US. If such progress continues, Europe might eventually be in a position to challenge the US dollar’s dominance, but this scenario is not foreseeable in the near term.

When the United States first elected President Trump, many in Europe and other parts of the world considered it a one-time aberration, expecting that after four years the country would return to its traditional foreign policy. However, it now appears that European countries and other allies recognize that the foreign policy associated with Trump may persist in American politics beyond his presidency. The preferences of MAGA voters suggest that this approach is likely to remain influential, and it seems unlikely that candidates similar to W. Bush or Mitt Romney will be nominated by the GOP in the near future. Another GOP president with MAGA views could return to office.

As a result, some U.S. allies are reassessing their security arrangements and considering greater independence or the diversification of their alliances. For example, Japan has expressed interest in improving relations with China, and Prime Minister Modi’s visit to China may reflect shifting geopolitical dynamics. While it is unlikely that Europe will form a security alliance with China, Russia, or India, European countries may explore strengthening security ties within NATO members without direct reliance on the United States.

As a conservative, I find it frustrating that many MAGA supporters believe the U.S. is self-sufficient and all-powerful, often overlooking our reliance on Western alliances. Even those aware of America's supremacy due to these alliances tend to underestimate Europe's role, seeing Europeans as more focused on benefits like extended vacations or free education than on defense spending. However, since the Ukraine war, this mindset has shifted—Europeans have realized the need for greater self-reliance and are beginning to strengthen their own military-industrial capabilities.

Supporters and critics are debating what President Trump's legacy in history will be. I personally think that one potential legacy of his presidency could be the dissolution of the post-World War II Western alliance, resulting in increased isolation for the United States.

Larniavc said:

The US economy is being meddled with by a bloke who went bankrupt running casino.

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And we are getting better off than the last bloke who needed rescuing by the Easter Bunny at an egg roll.

Thank God we have a President who knows how to negotiate with trans national leaders.The Congressional Budget Office (CBO) estimates that tariffs imposed in 2025 could reduce the federal deficit by $3.3 trillion over the next decade, with an additional $0.7 trillion in savings from lower interest payments, totaling a potential $4 trillion impact. Through August 22, 2025, tariffs and customs duties brought in $156 billion, nearly double the $78 billion collected over the same period the previous year. The Committee for a Responsible Federal Budget (CRFB) notes this revenue is "meaningful" and could slow the growth of the $37 trillion national debt,

Always in His Presence said:

Thank God we have a President who knows how to negotiate with trans national leaders.The Congressional Budget Office (CBO) estimates that tariffs imposed in 2025 could reduce the federal deficit by $3.3 trillion over the next decade, with an additional $0.7 trillion in savings from lower interest payments, totaling a potential $4 trillion impact. Through August 22, 2025, tariffs and customs duties brought in $156 billion, nearly double the $78 billion collected over the same period the previous year. The Committee for a Responsible Federal Budget (CRFB) notes this revenue is "meaningful" and could slow the growth of the $37 trillion national debt,

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And who pays for that? That’s right: American consumers.

Well played Mr President.

Larniavc said:

And who pays for that? That’s right: American consumers.

Well played Mr President.

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Might I suggest a better source than Christiane Amanpour

Always in His Presence said:

And we are getting better off than the last bloke who needed rescuing by the Easter Bunny at an egg roll.

Thank God we have a President who knows how to negotiate with trans national leaders.The Congressional Budget Office (CBO) estimates that tariffs imposed in 2025 could reduce the federal deficit by $3.3 trillion over the next decade, with an additional $0.7 trillion in savings from lower interest payments, totaling a potential $4 trillion impact. Through August 22, 2025, tariffs and customs duties brought in $156 billion, nearly double the $78 billion collected over the same period the previous year. The Committee for a Responsible Federal Budget (CRFB) notes this revenue is "meaningful" and could slow the growth of the $37 trillion national debt,

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I acknowledge your decision to place me on your ignore list, which I respect. Nevertheless, I intend to continue providing responses that emphasize factual analysis over political rhetoric and aim to assess policy implications objectively.

While you are entitled to disregard my comments, I will maintain my contributions for the benefit of others who may wish to evaluate the arguments provided. Should you choose to engage, I welcome the prospect of reasoned and intellectual discourse.

At present, media reports regarding negotiations between the United States and Europe, Canada, or Japan indicate that none of these proposed international trade agreements are legally binding. No participating country has formally approved any of these deals; for example, neither Canada’s nor the United Kingdom’s parliament has ratified such agreements. Similarly, an agreement with the European Union would require approval from each member nation, a process expected to take at least a year. The Japanese government follows comparable procedures, and the U.S. Congress, which holds ultimate authority over trade deals, has not passed any of the current proposals. As such, ongoing discussions remain categorized as political developments rather than conclusive agreements.

Regarding the CBO estimate, it is accurate that the CBO projects over $3 trillion in revenue for the U.S. government if tariffs persist for the next decade. However, the report does not clarify who will absorb the financial impact of these tariffs.

In reality, U.S. consumers will bear the cost, not foreign entities. Proponents of the tariff policy often refrain from specifying this aspect, likely due to its implications for the current administration’s position.

While tariffs may reduce debt if economic growth continues and recession is avoided, even in favorable circumstances, the financial burden will fall upon American consumers rather than foreign governments or companies.

As a longstanding conservative and advocate for free market capitalism, I find it unexpected that the Republican Party now supports policies that result in increased taxation of American citizens. The conservatism I have long valued appears to be shifting away from its traditional ideological foundations as we approach 2025.