Tim Kaine issued the following statement in response to ongoing gridlock over debt ceiling negotiations and new reports that Virginia is increasingly vulnerable to a credit downgrade as a result of the stalemate in Washington:
“For months, Congress has engaged in irresponsible political maneuvering by using the debt ceiling deadline and our economic stability as bargaining chips. Thanks to Washington’s political games, we are just four days away from reaching our legal debt limit and entering a state of default for the first time in our nation’s history. And still, even as the clock winds down, Republicans in Congress continue to press for a plan that is not sufficient to protect our nation’s credit rating and ignores the need for a bipartisan bill that can pass both the House and Senate. The time for political games is over. The gridlock must end. Compromise is not an option, it’s the only option.
“Last week, we learned that credit rating agency Moody’s placed Virginia’s triple-A rating on Creditwatch. Now we learn that Moody’s has also placed all triple-A rated Northern Virginia localities — including Arlington, Fairfax, Loudoun and Prince William counties as well as the cities of Alexandria, Fairfax, Herndon and Vienna — on Creditwatch. Though no fault of their own, the Commonwealth and these localities are in jeopardy of a credit downgrade because of the uncertainty of the finances of the federal government. A downgrade would have severe financial ramifications, forcing local communities to cut back on building new roads and schools and investing in other projects that create jobs. A downgrade would also force Virginia and local governments to spend millions more a year in interest payments for no reason other than Congressional intransigence.
“As Governor, I worked hard to successfully protect Virginia’s credit rating through the worst economic times in 70 years. And now, to see Virginia’s credit rating as well as the country’s at risk thanks to nothing more than the unwillingness of some members of Congress to reach a compromise is deeply troubling. Failing to raise the debt ceiling or merely passing an inadequate plan that would not protect our credit rating, risks a national state of economic emergency that would be felt by every family and business in America. A ratings downgrade would place a tax on virtually every American through higher interest payments on their loans and credit card debt. The United States Constitution charges Congress with paying our national debts and providing for the common defense and general welfare of our citizens. Prior Congresses have done so for over 200 years. It’s time this Congress took its responsibility seriously.”
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