Governor Heineman says the downgrade of United States’ credit rating should send a signal to Washington.
Heineman, during a news conference, offers a simple explanation for Standard and Poor’s move to downgrade US credit from AAA to AA+.
“They downgraded the credit, because the president and the Congress can’t get their act together and solve our deficit and debt problems,” Heineman states. “Pure and simple.”
So far, other credit agencies haven’t followed the lead of Standard and Poor’s, which had warned that it might downgrade the country’s credit rating if significant budget cuts weren’t enacted by Congress. S&P also stated that political divisiveness in Washington led to its decision to lower the credit rating a notch.
Heineman says it’s time for Washington to engage in serious fiscal reform and head towards a balanced budget.
“I’ve said it repeatedly, don’t spend money you don’t have and you won’t get in trouble,” Heineman says. “Our families don’t do that. Our businesses don’t it here in Nebraska. We don’t do it at the state level. The federal government needs to follow that example and, again, they need a balanced budget just like most of the states have.”
Heineman says he hopes the downgrade won’t hurt Nebraska, noting that the state doesn’t issue very many bonds. He acknowledges, though, that the downgrade could affect interest rates on municipal bonds.