S&P downgrade showed ‘terrible’ judgement: Geithner
Treasury Secretary Timothy Geithner slammed Standard & Poor’s on Sunday as showing “terrible judgement” in downgrading the US credit rating for the first time ever.
“I think S&P has shown really terrible judgement and they’ve handled themselves poorly, and they have shown a stunning lack of knowledge about basic US fiscal budget math, and I think they came to exactly the wrong conclusion,” Geithner said in an interview with NBC News.
His comments came amid growing suspense over the impact on world financial markets of S&P’s downgrade of US Treasuries from AAA to AA+.
Geithner took exception to S&P’s focus on the deep bipartisan divide in Washington over fiscal policy, saying, “Our country is much stronger than Washington.
“We have a very resilient economy. We’re a very strong country, and I have enormous confidence in the basic regenerative capacity of the American economy and the American people,” he said.
Earlier, the White House said Geithner was staying on as US Treasury secretary even as some Republicans called for his resignation in the wake of the downgrade.
“The president asked Secretary Geithner to stay on at Treasury and welcomes his decision,” said White House spokesman Jay Carney.
It put an end to speculation that Geithner would step down after an intense two and a half years in office that saw the US economy plunge into its worst recession since the Great Depression.
“Secretary Geithner has let the president know that he plans to stay on in his position at Treasury. He looks forward to the important work ahead on the challenges facing our great country,” Treasury Department spokeswoman Jenni LeCompte said in a statement.
On Saturday, Republican Senator Rand Paul called on Geithner to step down for what Paul’s office called a “gross mismanagement of federal economic policy” and his role in the credit downgrade.
US congresswoman Michele Bachmann, a Republican candidate for president in 2012, also called on Geithner to resign.
Washington has been split over how to reduce its more than $14 trillion debt without further hobbling the sluggish economic recovery, and even the limited debt deal came after a bruising partisan battle.
Geithner has been Obama’s sole treasury secretary, installed in January 2009 at the beginning of Obama’s presidency.