Geithner: America's debt rating not at risk despite mounting deficits

Treasury Secretary Timothy Geithner said the country’s debt rating is not at risk because of the trillions of dollars of government spending to shore up the economy.

Asked on ABC’s “This Week” Sunday whether the government would lose its triple AAA sovereign debt rating, Geithner said: “Absolutely not and that will never happen to this country.”

The administration has come under heavy criticism from Republicans and some outside observers for the mounting debt. President Barack Obama’s $3.8 trillion budget for 2011 includes a $1.3 trillion deficit. The White House projected more than $5 trillion in deficits over the next five years.

The recession, which began in December 2007, has meant less private spending and less tax revenue. The $700 billion financial bailout and $787 billion fiscal stimulus package have exacerbated the deficits stemming the recession.

Geithner said there was less risk now that the economy would slip back into recession, a pattern known as a “double-dip” recession.

“We have much, much lower risk of that today than at any time over the last 12 months,” Geithner said.

Still, the labor market is under significant strain, with the economy losing 20,000 jobs in January despite the unemployment rate dipping from 10 percent to 9.7 percent.

“We had a huge shock to the American economy and we’re still living with the aftershocks,” Geithner said. “You’re seeing the first signs now of business starting to take some risks again.”

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