Fitch’s US downgrade is stoking the very fight it warned against

economictimes.indiatimes.com:

Democrats and Republicans on Wednesday traded blame for the downgrade, with a group of hard-right conservatives promising to dig in during a looming spending fight that could shut down the federal government as soon as Oct. 1.

The bitter recriminations echoed the concerns raised by Fitch in announcing its decision after the close of financial markets on Tuesday. In a statement, Fitch cited an “erosion of governance relative to ‘AA’ and ‘AAA’ rated peers over the last two decades that has manifested in repeated debt limit standoffs and last-minute resolutions.” President Joe Biden, who has spent the summer promoting his “Bidenomics” agenda as the US economy shows surprising strength, was privately frustrated over the Fitch decision and expressed irritation to his team, according to people familiar with the matter who requested anonymity to describe private conversations.

Biden learned about the decision Monday and discussed it with aides the following day. When news broke Tuesday evening, he left for dinner at a nearby seafood restaurant and a screening of Oppenheimer, a movie about the atomic bomb, leaving aides to help shape the response.

Progress on jobs, real wages and bringing down inflation — all heading in the right direction — typically matter more to voters than a Wall Street credit grader’s score. Still, any indicator pointing to shortfalls in stewardship of the economy could damage public perceptions of Biden as he seeks reelection.

The president didn’t comment Wednesday when asked about Fitch’s decision during a bike ride near Rehoboth Beach, Delaware, where he is vacationing with family. Republicans blamed the decision on Biden’s policies, saying spending on domestic programs is fueling the national debt.