America received a giant wake-up call when Standard & Poor’s, the bond rating agency, announced that it was changing the outlook on its highly prized AAA rating for U.S. Treasuries to “negative” from “stable.” This is the first ratings warning for the United States since S&P began evaluating our creditworthiness in 1941.
S&P’s action is a significant marker of our country’s deteriorating economic position.
Treasury bond ratings matter — they are measurements of the fiscal strength of the country. The better the bond rating, the lower the cost of borrowing. And the costs of borrowing by the federal government are, of course, ultimately carried by the taxpayer.
So, what was the White House response?
Obama’s top economic adviser, Austan Goolsbee, downplayed the event, saying, “I don’t make too much about it.” The President himself went on a weeklong campaign swing highlighted by six fundraisers and sharp partisan attacks against Republicans for their attempts at deficit reduction and entitlement reform.
The main job of any executive — whether a CEO, a governor or a President — should be to avert these dangers, or work to repair them. When I took office in Massachusetts, we faced job losses and a fiscal crisis that had the potential to shake the faith of the credit raters in our bonds. We went to work to convince S&P and the other rating agencies that we were committed to reducing spending to balance our budget. I met personally with these officials in my office in Boston, and I traveled to New York City to meet them in their offices. S&P responded in 2005 with a credit rating upgrade that acknowledged the state’s sound fiscal management and the improving strength of its revitalized economy.Read the rest of the op-ed on Romney's Facebook page HERE.