Moody’s Ratings has downgraded the United States’ long-term credit rating from Aaa to Aa1, stripping the nation of its last perfect rating among the three major agencies, citing sustained rising debt, ballooning interest payments, and a lack of political will to rein in chronic budget deficits.
In its May 16 decision, Moody’s pointed to a steady deterioration in fiscal fundamentals across multiple administrations, noting that it does not expect current policy proposals to produce meaningful deficit reduction in the years ahead.
“This one-notch downgrade on our 21-notch rating scale reflects the increase over more than a decade in government debt and interest payment ratios to levels that are significantly higher than similarly rated sovereigns,” Moody’s said. “We do not believe that material multi-year reductions in mandatory spending and deficits will result from current fiscal proposals under consideration.”…