By Peter Schroeder - 08/02/11 01:37 PM EDT
Treasury Secretary Timothy Geithner on Tuesday lamented the “spectacle” of the debt-ceiling debate and said he doesn't know whether the final deal will be enough to save the nation's triple-A credit rating.
“It’s not my judgment to make,” Geithner said of a possible downgrade. “I think this is a good result, but a terrible process.”
The three major credit-rating agencies — Moody’s Investors Service, Standard & Poor’s and Fitch — warned Congress that a credit downgrade could be forthcoming if the nation doesn’t make sweeping budgetary changes to pare down the deficit. A downgrade to AA could rattle the markets and drive up interest rates for U.S. borrowing.
Geithner said the last-minute dramatics that enveloped Washington also hurt the nation’s reputation.
The debt-ceiling deal that the Senate is expected to approve Tuesday won’t hurt the economy, Geithner said, but he doesn’t expect it to boost jobs, either.
“This agreement itself, on its own, doesn’t create jobs,” Geithner said. “What it does is it avoids doing more damage in the short term, because the president refused to accept the types of deep spending cuts that many in Congress wanted.”
Geithner downplayed the risk of a double-dip recession even as data show the economic recovery losing steam.
“The United States is a very strong ... a resilient economy, and we’re in a very good position to benefit,” he said. “We’re still, you know, among the most productive economies in the world.”
Geithner also dodged questions about whether he would leave his post once the debt-limit deal had been finalized, as had been reported earlier.
“I’ve been a little busy,” he said. “I haven’t had a ton of time to think about that,” he said.