By Jamie Klatell - 08/06/11 04:09 PM EDT
The White House reacted to the Standard & Poor's downgrade of the U.S. credit rating by calling for more bipartisan compromise to "put our nation on a stronger fiscal footing."
But the administration didn't miss the chance to say, in essence, "I told you so."
"Over the past weeks and months the President repeatedly called for substantial deficit reduction through both long-term entitlement changes and revenues through tax reform, with additional measures to spark jobs and strengthen our recovery," press secretary Jay Carney said in a statement.
S&P, the credit rating firm that reduced the nation's rating from AAA to AA+, said the recent plan to raise the debt limit while reducing the debt "falls short" of its expectations, but also offered broader condemnations of America's political process.
S&P said it was "pessimistic" about the ability of Congress and the White House to reach a broader plan to rein in the deficit "any time soon."
The Treasury Department immediately pushed back against the downgrade by S&P, accusing the rater of having major calculation errors that threw the firm's entire rationale into doubt.
"A judgment flawed by a $2 trillion error speaks for itself," said a Treasury spokesperson.
Treasury officials immediately pointed out a perceived error in the analysis, which found it had pegged discretionary spending levels at $2 trillion too high, compared to analysis from the Congressional Budget Office. That calculation error resulted in a much higher growth rate of the nation's debt-to-GDP ratio.
In the White House statement, Carney said, "Over the coming weeks the President will strongly encourage the bipartisan fiscal committee as well as all members of Congress to put our common commitment to a stronger recovery and a sounder long-term fiscal path above our political and ideological differences."
Political compromise may be hard to find. Immediately after S&P made its announcement, Democratic and Republican Congressional leaders both issued statements saying the downgrade backed their side of the debate.
House Speaker John Boehner (R-Ohio) touted his party's efforts to curb spending while critiquing Democratic resisistance to those cuts.
Senate Majority Leader Harry Reid (D-Nev.) said it reinforces Democrats' call for increasing tax revenue.