Lake Havasu City, AZ - Congressman Paul A. Gosar, D.D.S. (AZ-09), issued the following statement in response to a report that the credit rating agency Fitch has lowered the United States of America’s Long-Term Foreign-Currency Issuer Default Rating from AAA to AA+, which will have a major impact on the ability of the United States to borrow money at the best rates: 

“The lowering of the credit rating is the direct consequence of the incompetence of the Biden administration.  This in turn will increase the cost of borrowing, contribute to the ever-growing deficit and make it more attractive for borrowers to borrow money from other countries.  

 It was Joe Biden’s Treasury Secretary Janet Yellin who famously declared: “I think I was wrong then about the path that inflation would take."  Seemingly, everybody else understood that when you spend and borrow massive amounts of money, inflation will inevitably result.  That is Economics 101.  As long as Biden and the democrats continue on their quest to spend more and more money, this economy killing inflation will continue.  The massive Biden-caused inflation is hurting all Americans,” concluded Congressman Gosar.

Background:

On August 2, 2023, credit rating agency Fitch downgraded the United States rating from AAA to AA+.  This will result in higher borrowing interest rates, while making the United States less competitive.  It also threatens the ability of the U.S. dollar to maintain its global dominance.   In light of Brazil, Russia, India, China, and South Africa (BRICS) and its efforts to create its own currency and to de-monetize the U.S. dollar, the Biden regime’s on-going foreign and domestic policy incompetence is causing lasting damage to the U.S. 

Fortune recently wrote: “As a scholar who has studied the BRICS countries for over a decade, I can certainly see why talk of a BRICS currency is, well, gaining currency. The BRICS summit comes as countries across the world are confronting a changing geopolitical landscape that is challenging the traditional dominance of the West. And while the BRICS countries have been seeking to reduce their reliance on the dollar for over a decade, Western sanctions on Russia after its invasion of Ukraine have accelerated the process.”

Meanwhile, rising interest rates and the recent debt-ceiling crisis in the U.S. have raised concerns among other countries about their dollar-denominated debt and the demise of the dollar should the world’s leading economy ever default.

In its report, Fitch explained that: “The rating downgrade of the United States reflects the expected fiscal deterioration over the next three years.  In addition, the government lacks a medium-term fiscal framework, unlike most peers” and it noted the budgetary process is complex and marked by last minute deals and lack of planning.