The United States Treasury Department says there is "no justifiable rationale" for Standard & Poor's move to downgrade the nation's credit rating as global finance ministry officials prepared responses to the historic announcement.
S&P's officials stood by their decision and laid blame on a political system that failed to adequately address deficit reduction in the compromise law that President Barack Obama signed on August 2 to avert a US default on its debt.
The Treasury Department issued a statement saying S&P had acknowledged an "error" in its calculations and claimed the rating company made a US$2 trillion mistake.
The Obama administration worked yesterday to reassure investors worldwide that Treasury securities remain a safe place to invest and sought to limit any negative effects on the economy in part by criticising S&P, according to an administration official who spoke on the condition of anonymity.
Some lawmakers said yesterday the downgrade announcement may put pressure on Congress to come up with more significant deficit reduction in coming months. Senator Tom Coburn, an Oklahoma Republican and a member of the so-called Gang of Six that has been working since early this year on a bipartisan deficit-reduction plan, said the S&P downgrade was "probably long overdue".
