Obama administration official calls S&P analysis 'way off'
August 5th, 2011
09:34 PM ET

Obama administration official calls S&P analysis 'way off'

The Obama administration angrily responded to Standard & Poor's decision Friday to downgrade the U.S. credit rating, with one senior official saying the agency's "analysis was way off."

U.S. Treasury officials received S&P's analysis Friday afternoon and alerted the agency to an error that inflated U.S. deficits by $2 trillion, said the administration official, who was not authorized to speak for attribution. The agency acknowledged the mistake, but said it was sticking with its decision to lower the U.S. rating from a top score of AAA to AA+.

"This is a facts-be-damned decision," the official said. "Their analysis was way off, but they wouldn't budge."

The White House is now in wait-and-see mode - hoping the decision and the S&P analysis face outside scrutiny, the official said.

"A judgment flawed by a $2 trillion error speaks for itself," a Treasury Department spokesperson said.

In July, S&P placed the United States' rating on "CreditWatch with negative implications" as the debt ceiling debate devolved into partisan bickering.

To avoid a downgrade, S&P said the United States needed to not only raise the debt ceiling, but also develop a "credible" plan to tackle the nation's long-term debt.

In announcing the downgrade, S&P cited "political risks, rising debt burden; outlook negative."

"The downgrade reflects our opinion that the fiscal consolidation plan that Congress and the administration recently agreed to falls short of what, in our view, would be necessary to stabilize the government's medium-term debt dynamics," the agency said.

Former Utah Gov. Jon Huntsman, who is among a field of Republican contenders for the 2012 presidential nomination, attributed the downgrade to "out-of-control spending and a lack of leadership in Washington."

"For far too long we have let reckless government spending go unchecked and the cancerous debt afflicting our nation has spread," he said in a statement. "We need new leadership in Washington committed to fiscal responsibility, a balanced budget, and job-friendly policies to get America working again."

CNN's John King and Dan Lothian contributed to this report.

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Filed under: Economy • Finance • U.S.
soundoff (197 Responses)
  1. s kel

    coperate ameica will not hire dud head republicans. The hugh profits they are making by downsizing and shrinking the workforce or outsourcing jobs overseas are great for them and their paidrepuke and tea crapper pawns in congress. i see a lot of tea bag fools on here not putting any blame on their people in congress. i really wish those people would all die.

    August 5, 2011 at 10:28 pm | Report abuse |
  2. Obama Administration VS S&P

    http://www.youtube.com/watch?v=7XC7g0H2QkU&feature=youtube_gdata_player

    August 5, 2011 at 10:40 pm | Report abuse |
  3. brenda copley

    F@@@@@@ OBAMAOSAMA

    August 5, 2011 at 10:40 pm | Report abuse |
  4. gung hoe

    Yep ya laughed at him because he was tellin us what was going to happen so what did ya do laughed at him some more because you thought he was being silly crieing like a little boy because he cared so much and what did ya do laughed at him untill his network took him off the air YOU FOOLS who am i talking about Glen beck he told us a long time ago what to beware of and you LAUGHED SHAME ON YOU

    August 5, 2011 at 11:00 pm | Report abuse |
  5. Snookie

    These lawmakers should get back to the office and work on fixing this!

    August 5, 2011 at 11:32 pm | Report abuse |
    • mssix

      Here's the problem Snook.... THEY DON'T KNOW HOW !! There's too many "YES" men. No one knows how to stand up and do what needs to be done.

      August 6, 2011 at 1:17 am | Report abuse |
  6. celebs4truth.com

    Watch...it'll be all out bedlam, and 3rd world status, blood and guts in the streets, and the general media will still be calling this all a "double-dip recession!" HAHAHA Anyone who listens to the Alex Jones show has known this was coming for a looooong time! It's only establishment/mainstream media brainwashed idiots that still buy the "double dip recession" garbage that they've been feeding the sheeple for months and months that didn't know anything was coming, whatsoever!

    August 5, 2011 at 11:44 pm | Report abuse |
  7. Bayousara

    Huntsman says, "For far too long we have let reckless government spending go unchecked and the cancerous debt afflicting our nation has spread...." My question is how long is "far too long?" I would say that would include George W. Bush's reign.

    August 5, 2011 at 11:55 pm | Report abuse |
    • Jeff

      Your right George W Bush spent 1.4 billion dollars a Day! Obama in 2 and a Half years has spent 4.6 billion dollars a Day.

      August 6, 2011 at 7:24 am | Report abuse |
  8. Matt

    For those who care....

    I would like to first address that although i am not a Obama supporter, in his defense one person can not ruin a country. The real issue is congress........ America needs to stop having a bleeding heart and focus on primary topics at hand like welfare. I see congress passing national seat belt laws, and smoking laws that restrict Americans freedom. If you decide to smoke, or not wear a seat belt thats your fault. So why do we pay lobbyist millions of dollars to create laws, which in the end cost Americans money. Instead do you see laws like re-eavaluating Food stamps? 14 percent of the American population are on FOOD stamps. Instead of politicians worrying about how much a state highway patrol should charge me for a seat belt ticket; they should re-evaulate where tax payers money goes to. For example i walk into my local grocery store to buy food, and while i am waiting in line and to check out, i notice the person in front of me had bought lobster, steak, chips, crab legs, and other expensive items, they whip out a food stamp card and pay for their groceries with it. Why as a citizen who goes to college, pays his debt, pays social security, pay taxes, and has a JOB not eat lobster, and steak every night like this person who just paid with food stamps. Okay heres another one....why are prison mates allowed benefits like health care, free college education, and better quality food than schools our own children go to? Thanks to congress, a mass rapist has the ability to have the same college education as i do for FREE.... As a citizen i tired of my stock plummeting 500 points in a day because of irresponsible spending, i'm tired of watching people on food stamps eat like kings only to become fat, diabetic and use up disabilities welfare, and i'm tired of uneducated politicians running the country. Obama and his administration are fighting over a two trillion dollar difference that could potentially lead to a lower credit score for the national government disgust me. A government reform is needed.

    Instead of blaming person blame an entire government for uncontrollable spending.

    August 6, 2011 at 12:18 am | Report abuse |
    • Matt

      yes there are a few that do that but me and my wife need food in our houses we didn't eat for a week and yes we admit we made mistakes in the past but were cleaning up our debt to get off our food stamps its not something were proud of we put our head down in the grocery aisle its embarassing.

      August 6, 2011 at 8:30 am | Report abuse |
  9. NJ08052

    CHANGE brought to you by the liberals

    I pledge allegiance to the nanny state
    and to the welfare office where I stand in line
    one nation under rules of inclusion
    with freebies we cant pay for all.

    Maybe when they controlled 100% of the govt they could have focused on the economy instead of ramming healthcare down our throats

    August 6, 2011 at 12:42 am | Report abuse |
  10. sherriw

    No more actors /actresses in congress. We have eneough in hollywood. This means you teaparty/republicans. Dems too! All should've done right by people. Corps too. People don't want a hand out, just wanto make an honest living and not to be cheated. I pray that God help the American people as well as other oppressed people! It's obvious wicked,selfish people don 't get it. Thank you God! I know you have the best interest at heart for people. God bless. Have a good evening America:-]

    August 6, 2011 at 1:08 am | Report abuse |
  11. mssix

    An article about going to month deploments was recentlly published. 9 month deployments are great. But if we are trying to save money don't do it by cutting our forces. Instead let's take another look at all of these highly "over paid" contractors. I'm deployed in Afghanistan, in a FOB that has no meaning of being here, in the middle of no where but yet there are local/american contractors being paid ridiculous amounts of money. I passed through Kahndahar recently. I spoke to an american that was working there. Her only job was to hand out linen to the ones passing through. Why is this person being paid almost $95,000 a year to do that? Really? There are civilian firefighters here at my location. Mind you there are zero trees or hard structured bulidings that burn up but yet these guys are making between $150,000 to $200,000 a year.!! The last fire that was here was.... NEVER!!! A dining facility manager making $250,000? This is where our damn money is going and it's been going on for years. WHY? Why isn't anyone looking into this? 95 g's to hand out some frigin sheets!!! are you kidding me!!! Someone needs to get there head out of their A** and do something about this and keep our forces strong. This is ridiculous. "For far too long we have let reckless government spending go unchecked and the cancerous debt afflicting our nation has spread." This a very true statement written in this article by John King. This is exactly what I mean.

    August 6, 2011 at 1:11 am | Report abuse |
  12. Winston Blake

    http://www.youtube.com/watch?v=A2qAFaev6pc

    August 6, 2011 at 2:22 am | Report abuse |
  13. Chicago Nick

    "develop a "credible" plan to tackle the nation's long-term debt."

    You know what that means in ENGLISH? SPEND LESS MONEY WE DON"T HAVE. Got it?

    August 6, 2011 at 2:37 am | Report abuse |
  14. Chicago Nick

    FLASHBACK: 'No risk' USA will lose its top credit rating, says Treasury's Geithner...

    Obama Flashback: My Presidency Will Be ‘A One-Term Proposition‘ if Economy Doesn’t Turn Around in ‘3 Years’

    August 6, 2011 at 2:41 am | Report abuse |
  15. ENDisHERE2012

    THE END OF AMERICA IS HERE. just look at the news. please stock up on bulk non-perishable foods, water, home and self defense, and first aid kits now. financial collapse is happening very soon. are you ready? only a complete fool would not take my warning. buy organic seeds plant a garden. soon the stores will be empty and there will be civil unrest. wrol/shtf situation is imminent. google and learn about modern survival before its too late. the FINANCIAL COLLAPSE IS HERE

    August 6, 2011 at 2:54 am | Report abuse |
    • Matt

      Endishere i have been saying this for the last 2 years and have been laughed at and i have been marking every moment in my book i was right you were right we were right. I have a list of items including military badges nato badges and most importantly Martial Law gear ups. Get disguises to man your going to need it when the military comes knocking on your door to put you in REX84

      August 6, 2011 at 8:36 am | Report abuse |
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