Republican presidential contenders say the decision by Fitch Ratings to downgrade America’s long-term foreign-currency-issuer default rating this week should be a “wake-up call.”
The agency cited ongoing and projected future fiscal instability, an increasingly long and disruptive governance process, and rising debt and deficits in making its determination.
“The repeated debt-limit political standoffs and last-minute resolutions have eroded confidence in fiscal management,” Fitch said. “In addition, the government lacks a medium-term fiscal framework, unlike most peers, and has a complex budgeting process. These factors, along with several economic shocks as well as tax cuts and new spending initiatives, have contributed to successive debt increases over the last decade.”
The White House was quick to disagree with Fitch’s decision and to push off blame to the Trump administration, saying in a statement it “defies reality to downgrade the United States at a moment when President Biden has delivered the strongest recovery of any major economy in the world.”
“And it’s clear that extremism by Republican officials — from cheerleading default, to undermining governance and democracy, to seeking to extend deficit-busting tax giveaways for the wealthy and corporations — is a continued threat to our economy,” press secretary Karine Jean-Pierre said.
Biden’s presidential campaign dubbed the move the “Trump downgrade.”
“This Trump downgrade is a direct result of an extreme MAGA Republican agenda defined by chaos, callousness, and recklessness that Americans continue to reject,” Kevin Munoz, a spokesperson for the Biden campaign, said in a statement. “Donald Trump oversaw the loss of millions of American jobs, and ballooned the deficit with the disastrous tax cuts for the wealthy and big corporations.”
Trump, for his part, reacted to the situation in a post on Truth Social saying only: “Fitch just downgraded U.S. Debt. First time in many years. WOW!”
Florida governor Ron DeSantis said the downgrade is a “result of frivolous spending and ballooning national debt for programs like the CARES and ‘Inflation Reduction’ Acts.”
“Florida’s AAA rating remains the standard-bearer, serving as the nation’s blueprint for fiscal responsibility,’ he added in a post on X. “In FL, we have run large budget surpluses and have paid off nearly 25% of the state debt. National economic decline is a choice.”
The shift came one day after DeSantis unveiled his ten-point “Declaration of Economic Independence” plan during a campaign stop at a New Hampshire manufacturing facility. The plan involves simplifying the tax code, reining in federal spending, taking on China, and reversing left-wing regulations that make it harder for private companies to create new jobs.
It also calls for supporting school choice nationally, accelerating the development of vocational and apprenticeship programs to fuel an industrial revival, securing the border, limiting unskilled immigration, and ending ideological investment standards involving public funds.
Trump senior adviser Jason Miller claimed DeSantis directly copied the former president’s economic policies.
“He literally cribbed almost everything from what we did with President Trump in his first term — down to the terminology, the language, the framing. It was quite remarkable,” Miller told The Washington Post. “It read to me like a ChatGPT version of how someone would try to re-create Trumpian economic policies.”
Trump said in April that he would remove President Biden’s “wasteful and job-killing regulatory onslaught” and rein in “out-of-control bureaucracy” if elected again. He also proposed bringing independent regulatory agencies, including the FCC and FTC, back under presidential authority.
Meanwhile, former Arkansas governor Asa Hutchinson wrote in a thread on X that the nation’s debt has “exploded” over the last 20 years under the leadership of both parties, “with no end in sight.”
“We can’t ignore the debt crisis any longer. It’s time to tighten our belts and embrace pro-growth policies for the sake of our future generations,” he added.
“The downgrade of U.S. credit is a wake-up call, but President Biden is asleep at the wheel. America needs leaders who prioritize solutions, good governance, and fiscal discipline over ideology and demagoguery.”
Lance Trover, a spokesman for North Dakota governor Doug Burgum told National Review that the downgrade is “exactly why America needs a new leader for a changing economy.”
“Governor Burgum cut spending to eliminate a $1.7 billion shortfall and helped pass the largest tax cut in state history while overseeing some of the lowest unemployment in the nation,” Trover added. “As President he will unleash America’s economy with innovation, not more Biden-style regulations.”
Ken Farnaso, a spokesman for Nikki Haley, told National Review: “Nikki Haley always speaks hard truths and has called out Joe Biden and both Republicans and Democrats for creating the economic crisis we see today. It’s not shocking that America’s economic standing has fallen. DC’s spending addiction will end in a Haley administration.”
Senator Tim Scott shared a Fox Business article about the downgrade on X and commented, “Once again, the Biden Administration wants America to believe what they say, not what Americans see. Instead of an apology, they offer nothing but excuses for crippling Bidenflation that now taints America’s standing on a global stage.”
While former vice president Mike Pence did not immediately react to news of the downgrade, his public policy organization, Advancing American Freedom, noted the downgrade “follows Democrats’ out-of-control spending.”
“The United States is in the worst fiscal position in the history of our country, and the responsibility of this falls at the feet of the Biden administration,”AAF Executive Director Paul Teller said. “‘Bidenomics’ has been a disaster with 40-year high inflation, budget-breaking prices at the grocery store, and mounting economic pressure for American families. This decision from Fitch Ratings sends a clear signal: Congress must act now to eliminate wasteful government spending.”
Pence released his own plan for fighting inflation last week. It includes four points: Reduce deficit spending, allow increased energy production, use deregulation to bring supply chains home, and change the Federal Reserve’s statutory mandate.
A Quinnipiac poll released last month found the economy was the top issue among surveyed voters. Thirty-one percent of registered voters said the issue was the most important to them in deciding who to vote for in the presidential election. Preserving democracy in the U.S. came in second with 29 percent of voters citing it as their top concern.
Fifty-one percent of Republicans cited the economy as their top concern, followed by 22 percent who said preserving democracy and 13 percent who said immigration.